Banks have hefty rewards programs
Whether they're offering airline miles, discounted hotels, cash-back rewards, or other perks, banks have made good use of loyalty programs that keep their customers focused on earning points. But if you're focused on rewards, you're not seeing the big picture, Nitzsche says.
"Many credit unions offer rewards on debit cards and credit cards, too," he says. "And quite a few banks stopped offering debit cards with rewards a few years ago. Plus, many banks have discontinued offering free checking accounts."
In some cases, Nitzsche says consumers can become so focused on rewards programs that they often miss the fact that the gains from those programs are a lot less than the fees they're paying to their bank.
"When you sit down and do the math, the risks and losses associated with loyalty programs often surprise consumers," he says. "The benefits of doing business with a credit union are far more advantageous to consumers in the form of better rates on loans, deposit accounts and lower fees."