Credit Union: Joining a credit union: it's who you know at work, at home or in your neighborhood

You could join a credit union because a distant relative belongs to one. Or because you're in a church choir. Or you volunteered at your local school. Or because you reside in the right place.

The consumer-friendly benefits of credit unions are much more widely available today; so much so that you might be eligible for one and not even realize it. Some are available to anyone who lives in a certain geographic area and others are open to anyone who shares an interest.

But who do you ask? Where do you start? The people you know are the most likely source; be it cousin, colleague or neighbor, someone will likely belong to one.

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Talk to the family
One way to find out how to join a credit union is to ask members of your family. Most credit unions extend membership privileges to immediate relatives of its members. What's immediate? It varies but often a spouse, children, grandparents, cousins, aunts and uncles can join.

Chances are some will belong to one of three different types of credit unions: association, community or occupation-based.

Association-based means that the credit union is centered around a group you belong to, like a church or nurse's association. A perfect example: The Unified Singers Federal Credit Union in Thomasville, Ga. Membership is open to churches and choirs in Thomas and Brook Counties. Of the 11,783 credit unions in the nation, roughly 13 percent fall into this category, according to the Credit Union National Association, a Washington-based trade group.

A community credit union defines its members as those who live in a specific geographical area. For example, if you live or work anywhere in the Florida Keys, you can join the Keys Federal Credit Union. The Portland (Ore.) Teachers Federal Credit Union over time has expanded its eligibility rules far beyond teachers. For instance, any alumnus of a public or private college in the five-county area can join.

While their numbers are small -- comprising only 6 percent of all credit unions -- many community credit unions have been around since the early part of the century and have evolved to include neighboring counties.

Don't let the word "community" fool you: many of these groups are large in size and offer an array of products that can be found at any local bank, including mortgages and credit cards.

Save with your co-workers
Finally, an occupation-based credit union allows anyone who works for certain employers connected with the credit union to be a member. Ask your human resources representative if your company either sponsors a credit union or if the employees are members of a select employees group. This means that the company does not have the required membership size to start their own credit union, but a large credit union has taken the company's employees under their wing and is allowing them to use their products and services.

Chances are greatest that you'll join a credit union that is affiliated with the type of work you do. Roughly 77 percent of all credit unions are occupation-based. Work-related credit unions often cater to members through products geared around family activities and leisure outings.

"Many members find the best deals and discounts on things like vacation packages through their employer's credit union," says Larry Blanchard, director of the Credit Union Campaign for Consumer Choice, a grassroots group that has lobbied for membership legislation.

Ask Patrick St. Jean why he joined his employer's credit union and he quickly names two reasons: Carmen and Elaine -- his daughters

The management information specialist and his wife took their two children to Disney World, thanks to a vacation package offered by his credit union. "We were able to get decent-priced hotel rooms and discounted passes, which in the end saved us a lot of money," says the Dallas resident.

The perks are certainly a plus, but the general appeal to become a credit union member has become obvious. Credit unions offer traditionally low rates on credit cards, savings and checking accounts. They also offer premium customer service -- once a member, you're a member for life -- no matter where you move to.

If neither your employer, relatives nor neighbors are affiliated with a credit union, there's still hope. Each state has a credit union league that will pinpoint which credit unions you are eligible to join. For a list of contacts, look at our interactive map.

Weigh your options
Credit unions continue to woo potential members by expanding their automated teller machine networks and offering more innovative products such as online brokerage services and electronic bill payment. But, before giving banks the boot, consider how many financial transactions are made each month as a gauge for choosing a credit union, advises Michael Kidwell, vice president of Debt Counselors of America, a consumer counseling agency based in Rockville, Md.

For example, does the cost of visiting an ATM at a credit union stack up to a checking account at a bank that charges 50 cents per check? Or does a certificate of deposit with a higher return mean more than a savings account that earns very low interest?

The bottom line? Compare fees, Kidwell says.

"Some credit unions may not offer things like safety deposit boxes, cashier's or certified checks," Kidwell said. "We've actually had clients who weren't able to get those type of checks from their credit unions."

If you are considering a credit union, keep tabs on the number of checks written, how often ATMs are used and the potential fees for those transactions. Banks on average will allow a certain number of transactions per month before the fees hit. Another consideration is whether money deposited in a credit union account will earn enough additional interest to offset ATM fees the credit union may charge.

Comparing service, convenience
Finally, does the credit union require a smaller balance but provide the same level of service and convenience as a bank? One usually overshadows the other, Kidwell points out.

For example, Kidwell recalls that he recently wanted to price a car he planned to sell. He went to his credit union and stumbled upon the National Automobile Dealers Association books laying right on the reception area's coffee table.

"Most banks just don't offer that type of convenience," he says.

Despite their customer service reputation and low rates, some members opt to split their banking between a bank and a credit union. Why? Kidwell says it's a matter of compensation.

"You may value that personal interaction at a credit union but still want the convenience of a lot of ATMs," Kidwell says. "If you decide what's most important about joining a credit union, you can fill in the holes as you go."

-- Posted: May 26, 1999