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Being a student can be busy and challenging at the same time. The past few years have also been stressful with the pandemic and its aftereffects. Many students find college life difficult, especially for those living alone for the first time and managing finances. It can be challenging to juggle a busy semester, fend for yourself, and manage finances.
At times like this, you must take advantage of facilities that can make life easier for you and help you navigate college life better while providing you with the best services. Most are not aware of the presence of credit unions and how they function. Being a federal credit union member comes with many benefits compared to most prominent banks.
Most college campuses run promotions by credit unions featuring excellent rates for students and other financial options. We have put together five reasons why you should consider joining a federal credit union if you are a student.
#1 Affordable Loans
Credit unions frequently offer lower loan rates than commercial banks, which works well for students needing a loan facility. Hence taking a student loan from a federal credit union will get you a better rate than a bank. Since credit unions are nonprofit organizations, they are not required to pay dividends to their shareholders. They can re-invest it in their members by lowering the loan interest rates. Another benefit of being a credit union member is that they are willing to negotiate for loan rates with members rather than bigger banks, allowing students to save money.
#2 Credit Cards
It is a well-known fact that credit cards issued by banks are debt traps for students, who may spend a lifetime paying them off. Federal Credit unions usually offer cheaper interest rates and lower fees on their credit cards than banks, making them a better choice for college students. College students can use credit cards more prudently by joining credit unions as they are more likely to offer their members financial education and products.
#3 Financial Education
According to a survey released by the digital publication, The Financial Brand, 83% of young adults in the USA did not have any financial education in high school or college. Federal credit unions are dedicated to teaching members how to manage their money and make wise financial choices. Their motto is to help people by promoting financial education in the communities they serve. Credit unions regularly organize free webinars and events on managing debt, forming a monthly budget, and other lessons for good financial health. Along with opening their first federal credit union checking account, university students can learn the fundamentals of personal finance through these classes offered by credit unions to their members.
#4 Belonging to a Community
Credit unions operate or are involved with many volunteering and community welfare projects. This means they are more likely to provide services and products tailored to the local community’s needs. It is especially helpful for college students who are new to the area and are still settling in. Federal credit unions are also more likely to provide products and services specifically to university students’ requirements.
#5 Members as Owners
When you join a federal credit union, you become a member rather than a customer. Instead of stockholders, each member owns a shareholder share in the credit union. When you join a credit union, you own a portion of the credit union. As a result, they are known for providing excellent member experiences. Unlike big banks, the profits generated by credit unions benefit both the members and the local community. Customers are more likely to receive better service and more competitive rates at credit unions than banks, making them an appealing option for college students.
Winding Up
Federal credit unions can be an excellent way for college students to save money and manage their finances. Credit unions are a perfect option for students to save money and work their finances. Credit unions encourage college students to make sound financial decisions and offer a range of benefits like lower loan rates, fewer fees, and provide financial literacy.
