DISCLOSURE – I am a long-time member and employee of a credit union. As such, I have some expertise in how they operate, but my employment could be seen as a conflict of interest. I will do my best to write objectively, but please know that I do have a personal stake in the credit union movement.
Occupy Wall Street and other organizations have planned various “Move Your Money Day” actions in the next few weeks, but the run on the big banks has already begun. People are fed up with large, unresponsive banks and are moving their money to credit unions and small community banks. It’s not enough just to “move your money” to a credit union, though. Credit unions are financial cooperatives that provide the same services as banks, so when you become a member of a credit union, you have a voice in how that credit union operates. Use that voice!
Credit unions have boards of directors made up of elected volunteers from the membership. They might be reimbursed for expenses, but they are not paid. As a member, you can run for election to the board of directors. There might be a waiting period before you can run, but most members are eligible. As a board member, you can help make decisions about how the credit union charges fees, invests its funds, pays its employees, and interacts with the local community. Don’t just move your money - run for your credit union’s board of directors.
Even if you can’t serve on the board, you can vote for the board of directors. Read the newsletters. Visit your credit union’s website. Find out who’s running and how to cast your vote. Contact the candidates if you have questions about their views or experience. Don’t just move your money - vote for your credit union’s board of directors.
Most credit unions have at least one general membership meeting per year where executives and board members explain the previous year’s performance, go over their business plans, announce election results, and take questions from the membership. Go to the annual meetings. Ask questions. If you have an important agenda item, contact the board or one of the executives ahead of time and ask them to include it. Don’t just move your money - attend the credit union’s annual meetings.
Most credit unions aren’t concentrating on attracting more deposits right now, they need to make more loans. The difference between the amount of interest they pay to depositors and the amount of interest they collect from loans is the traditional way financial institutions make enough to cover their operating expenses (and make a profit in the case of banks.) That difference (the spread) continues to shrink as loan rates go down, because the amount that credit unions are now paying their members for deposits (like a savings account) is at or near zero. That side of the equation cannot go any lower. So, don’t just park some money in a credit union CD and leave it at that. Remember, it’s a CREDIT union. If you currently use a credit card, find out if the credit union offers one and apply (it will probably charge less interest than your current credit card.) Refinance your current car loan from a bank to your credit union (yes, you can do this.) Same with your mortgage. Any time you need a financial service, check with the credit union. They might offer what you need. Don’t just move your money - make the credit union your primary financial institution.
You can probably see why big banks are generally hostile toward credit unions. Credit unions provide real competition, which is why credit unions are constantly fighting off political attacks from the bank lobbyists. Stay informed on issues that affect your credit union. Contact your political representatives when necessary and fight for your credit union. Don’t just move your money – be an advocate for your credit union.
To counter the attacks from the banks, credit unions have their own trade associations and their own lobbyists. Unfortunately, the credit union trade associations are often caught up in the pay-to-play system that has corrupted our political institutions. It doesn’t have to be that way. Track political donations from credit union PACs. Call the credit union associations. Question why they are supporting regressive or dishonest candidates. Don't just move your money, move to amend the Constitution to outlaw the legalized bribery that Citizens United and other court decisions have unleashed on our country.
More information from the Move Your Money Project can be found here.
More information about the efforts to amend the US Constitution can be found here.
More information about credit unions can be found here.
UPDATE The credit union industry is paying attention...
http://www.cutimes.com/...
http://www.cutimes.com/...
Don’t Just Move Your Money – Occupy Your Credit Union!