The best banks and credit unions in California

How to know which bank or credit union is best for you

Our article lists California credit unions and banks that offer the best products and services. However, choosing one that meets your needs means that there are several factors that you need to consider in order to make the right decision.

Although banks and credit unions are similar when it comes to the services they offer, there are still significant differences in product, pricing, and availability for these two types of financial institutions.

While banks are for-profit institutions, credit unions work for their members. As such, credit unions are non-profit institutions, giving their members more freedom in decision-making. Of course, both types of organizations are equally secure. Trusted banks are members of the FDIC, while credit unions offer products insured by the National Credit Union Administration (NCUA).

To know which bank or credit union in California is right for you, you first need to know the pros and cons of both.

Benefits of credit unions

The main objective of a credit union is to offer better financial products to people linked by their place of life, their work organization, their faith or any other factor. Unlike banks, members of credit unions are all equally involved in making decisions about a credit union.

While banks work for profit, credit unions don’t. Instead, they strive to provide their members with the most favorable terms for the products they offer.

High rates and low fees are the main reasons for choosing a credit union over a bank. The biggest unions in California offer affordable checking and savings accounts with little or no monthly fees.

In addition, the interest rate that you will accumulate on your deposits is higher than in traditional banks. Depending on the credit union you choose, you can earn interest on your account with monthly balances of less than $ 1.

Credit unions offer affordable rates on personal and auto loans. Unlike banks and online lenders, credit unions also try to offer flexible repayment terms to their members.

As mentioned, credit unions are practically owned by their members, which means they vote and participate in creating and changing credit union policies. For this reason, credit unions also provide better customer service than most banks.

Disadvantages of credit unions

Although they offer better rates on loans and bank accounts, these financial institutions are not without flaws. One of their biggest shortcomings is the limited number of products offered by most credit unions.

However, California’s best credit union will no doubt offer products that an average consumer might be looking for, including checking accounts and savings products, personal loans, and credit cards.

Another thing that might be a problem for some customers is the lack of branches of California state credit unions. Unlike banks, which typically have physical stores in every state, some credit unions do not have branches at all.

In some cases, credit unions may charge membership fees. In addition, to become a member of a credit union, you must meet its specific requirements.

Banking benefits

While credit unions limit their customer base to a specific community, banks are open to any individual or business. To open a bank account, you just need to be at least 18 years old and a U.S. citizen.

All of the major banks in California have a long list of financial products, including checking and savings accounts, credit cards, personal and business loans, IRAs, and more. Unlike credit unions, large banks have a large network of ATMs and more physical stores.

The main advantage of using banks and their services is that they invest more money in online and mobile banking than credit unions. While you can still benefit from California credit union online banking services, banks offer more advanced and faster services.

Almost all banks offer a mobile app for iOS and Android phones, so you can manage your account, pay your bills, and shop on the go.

Banking disadvantages

If you open an account at a bank, you will be a customer, not a member. As a customer, you have no right to decide how the bank is run. Sometimes you can get poor customer service as well, especially if you compare it to customer-focused service from a credit union.

Most importantly, banks are for-profit institutions, which means they have to profit from you. In practice, this means lower interest rates, higher fees and less flexible terms.

Although all California banks offer a plethora of products, banking services are more expensive than those offered by credit unions. If you want to apply for a personal loan, you should expect high monthly rates.

On the other hand, bank accounts and savings accounts come with low returns and monthly management fees. If you want to open a profitable bank account, it’s best to check with local banks or branches of California credit unions.

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