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Is it Still Safe to Keep Your Money in a Credit Union?

Chris Gottschalk

Chris Gottschalk About The Author

Apr 14, 2020 6:30:00 AM

Market slowdowns and recessions can be scary. Ask anyone who lived through the financial crisis in 2008. The uncertainty and fear can almost be overwhelming, and many people lose faith in financial institutions as a result.

Unfortunately, this can lead people to take drastic actions, such as withdrawing all their money from their savings (and occasionally their 401(k) plans) and storing it somewhere they think is safer, like their mattress or sugar bowl.

This isn’t a good idea, though. No matter how scared you are of a recession, the truth is that credit unions and banks are the safest places you can keep your money and offer benefits that you won’t get if you keep your money in your mattress.

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Credit Unions And Banks Are Insured

Lady Saving Money | First Alliance Credit UnionThe biggest reason to leave your money in a credit union or bank is simple—they are insured. All credit unions are insured by the NCUA up to $250,000, while banks are insured by the FDIC for the same amount. If you have over $250,000 in your accounts, work with your financial institution. There are numerous ways to insure all of your deposits.

Credit Unions And Banks Pay Interest

When you keep your money in a savings account, that money earns interest. That interest is what a financial institution is paying you to keep your money with them. While you won’t get rich off the interest, you will definitely get more cash back from a savings account than you will your mattress.

Online Payments Are More Common

An online payment | First Alliance Credit UnionThese days, most people don’t use cash or checks to make payments. According to one survey, 60% of payments in 2022 were made with debit and credit cards. Even more striking, a Mastercard survey reported that 93% of global consumers would prefer to use contactless payment methods, i.e. mobile wallets, in the future. 

Like it or not, cashless transactions are here to stay. When you couple this with the fact that physical money can easily be contaminated with bacteria and viruses, it’s not hard to see how cashless transactions will become more popular than ever. If you want to use cashless transactions, though, you’ll need to have a checking account.

Keep Your Money Safe With First Alliance Credit Union

When the world goes through a crisis and the markets are volatile, wanting to feel like your money is safe is only natural, especially considering how many banks failed during the Great Recession. However, financial institutions are by far a better choice than squirreling your money away somewhere in your home.

When you become a member at First Alliance Credit Union, you can not only make sure your money is safe in a traditional savings account, you can also make your money work for you. Invest in a Certificate of Deposit (CD) to get a higher rate of interest, or put your money in a money market savings account. You can even put your money in a WINcentive savings account for a chance to win a prize each month you increase your savings!

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We do our best to provide helpful information but we cannot guarantee the accuracy or completeness of the information presented in the article, under no circumstance does the information provided constitute legal advice. You are responsible for independently verifying the information if you intend to use it in any way. Additionally, the content is not intended to be reflective of First Alliance Credit Union’s products or services, for accurate and complete details about our product and service information you must speak to an advisor at First Alliance Credit Union.