Your Money Dilemmas, Solved
Should I Keep My Money in a Big National Bank or Go With a Local Bank or Credit Union?
If convenience is your number one priority, big banks offer it: Your mortgage, credit cards, and checking, savings, and retirement
accounts can all live under one roof, thus simplifying your paperwork, says Greg McBride, a senior analyst at Bankrate.com, a financial website. Furthermore, if you’re the type of person who does all (or most) of her banking online or if you frequently
travel and want compatible ATMs wherever you go, stick with a large institution.
But if you’re more keen on earning the most interest, signing a car loan with the best terms, or paying the lowest fees, look to a local bank or a credit union (a cooperatively run financial nonprofit). “Smaller institutions must compete for customers, so their rates are usually more favorable—and they focus more on customer service,” says McBride. Also, credit unions don’t pay out profits to investors, says McBride, so they can keep fees as low as possible. (Your money is safe in either type of institution. The Federal Deposit Insurance Corporation, or FDIC, insures up to $250,000 per bank depositor. The Credit Union National Organization does the same per credit-union account.) To find a local bank, go to icba.org, the website of the Independent Community Bankers of America, and search by ZIP code. If you want to join a credit union, it’s easier than you think. Often you only need to be a member of a specific church or community. Go to find a creditunion.com.
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