by Connor C.
Credit unions were becoming more popular throughout the years, but recently slowing down and are projected to get worse in the next 2 years. Always pick the right bank for you as a credit union isn’t for everyone. However, I’m here to show more of the benefits on how a credit union can help raise your credit score and maybe even make people reconsider their choice of bank.
Credit-Builder Loans: Credit unions like to fix damaged scores through the credit-builder loans. A credit builder loan typically holds the amount borrowed from a previous loan while you continue to make payments, which builds your credit. People like to see credit-builder loans as a “Fresh Start” or “Starting Over” as you technically are restarting over your previous mistakes. The only thing that is restricted when under a credit-builder loan is that the money that is being held back can’t be accessed until you have fully repaid the loan, which means you can build savings and your credit score at the exact same time. Ways you can help yourself manage a credit-builder loan are ways like making payments on time, monitoring your credit score, picking the right type of credit-builder loan, and deciding what to do with any interest.
Get Free Credit Counseling: Credit Unions are always willing to help those out that need to be more educated on budgeting and using tools with the goal to help reduce and completely eliminate debt. It’s just not debt as well, it also helps with developing a budget, how to get copies of your credit report/scores, and helps you organize a plan for any future debts. It’s extremely easy to get access to a credit counselor, typically you just access the credit union’s website and either decide to go through an in-person meeting, internet, or over the phone.
Take Advantage of Online Tools: The online tools that credit unions let you have access to are really beneficial in helping you with certain tasks. Online banking is so much more convenient than having to go to a physical bank as you aren’t restricted in the time frame. You no longer need to wait in lines as we know everyone doesn’t like lines, and lines are actually some of the reasons why people dislike going to the bank. You also get instant access to your transactions and account history which can be useful for both watching over your transactions to help you manage your money, and also pointing out any false transactions that you can bring to the bank’s attention. It makes it easier to pay bills on time which in the end improves your credit score. Last but not least, the ability to transfer money between accounts is an extremely useful thing to have when you’re older or anytime.
Establish Credit With Secured Cards: Usually with a secured card it’s not a long-term commitment, and its purpose is for you to improve your credit score to qualify for better options in terms of loans, cards, etc. Eventually, you’ll move up to an unsecured card which can get your deposit back. It’s important to consider choosing the right secured card that fits you best. Again the purpose of a secured card is to help you build credit, but that can’t happen if it isn’t toward the credit bureau which is just companies that handle the credit reports that form the basis of credit score. Always look at the reasonable fees, path to an upgrade, and a deposit you can afford when considering a secured card. Usually after 630 credit score is when you are able to apply for an unsecured card which converts into a regular credit card.
Hopefully, I might have made you consider switching or starting with a credit union. Overall, these are key takeaways to what makes a credit union so beneficial for your credit score and how it can raise it in the long run. Credit unions can hopefully make a comeback in growth in the future as the projected growth doesn’t look too good.
Works Cited
“5 Ways Joining a Credit Union Can Help Build Your Credit.” Spero Financial, 8 Nov. 2020, spero.financial/5-ways-joining-a-credit-union-can-help-you-build-your-credit/.
McCarthy, Ken. “Credit Unions Turn to Digital Outreach as Membership Growth Slows.” American Banker, American Banker, 23 Feb. 2021, www.americanbanker.com/creditunions/news/credit-unions-turn-to-digital-outreach-as-membership-growth-slows.
O'Shea, Bev. “What Is a Credit-Builder Loan?” NerdWallet, 15 Apr. 2021, www.nerdwallet.com/article/finance/what-is-credit-builder-loan.
Soucy, Paul. “How to Build Credit With a Secured Credit Card.” NerdWallet, 26 May 2020, www.nerdwallet.com/article/credit-cards/build-credit-with-secured-credit-card.
I love this blog! It really helped me understand why and how. Honestly great blog overall and loved the part where you talked about the online tools because me personally would use those more than anything in the world.
ReplyDeleteThis is very helpful, lots of information here! I have never had a credit card so learning this for future purposes is greatly useful! I never knew there were many different ways to help build your credit score. Lots of these ways to build up your credit are also free so you might as well use them to your advantage. Getting counseling help from a reliable person that knows what they are doing is a great idea or other routes to help you from having a bad credit score because otherwise bad credit can lead to higher interest rates and fewer loan options. Not only that but it can also cause finding a house harder and acquiring certain services harder. So people have to make sure that they are finding ways to up their credit score!
ReplyDeleteI liked how this blog was laid out; it was nice and easy to read and get all the information that you would need to know about a credit union. I think Credit Unions are very popular for college students because of all the benefits you get when going through them. As listed in the article, there are lots of great benefits that could help out college students. This blog was extremely helpful for everyone, especially, I think then seniors that will be going to college this fall.
ReplyDeleteThanks for this blog. I didn't know certain credit unions worked best with certain banks, now I know that I need to switch. Getting an advisor that you trust is a good idea when you are trying to build your credit score. This was a great blog to post for highschool students, as we will need this information in a few years.
ReplyDeleteI appreciate the convenience of the layout in this blog. It was a simple yet effective way in gathering and communicating the information on Credit Unions. Credit Unions are very promininent in young adults and are even involved with all types of adults. When not knowing everything you need when becoming involved with Credit, it may make or break everything in your life.
ReplyDeleteLove the way you laid this out with such simple explanations making it easier to read. What would help this make it better is some examples that the reader can try or some scenarios a person may find when they do go to a credit union. There some places I had to reread just cause of the wording. I know I said simple explanations that made it easier to read, but eventually the process clicked after an extra second of rereading. Overall, still a great piece.
ReplyDeleteAs someone who has never had a credit card yet, this was super helpful because it was very easy to read and understand, and gave good insight into all my options for the future, and what might be best for me. I hear all about credit unions on commercials and such but don't have a ton of experience with actually knowing much about them. Good job!
ReplyDeleteThis blog really helped, especially the topic you covered was a great one to cover. Going over this all is very insightful especially to the younger generations. Getting a credit card is a big step in the right direction if you are smart financially and are able to maintain a good credit score but also getting a financial advisor and having someone help you in that area of making sure you have enough money for a house or setting money aside for other purchases is something that is super helpful. Great piece!
ReplyDeleteI like that you included the situations that make the most sense for people to join credit unions as opposed to banks. I also like that your post showed a variety of services offered by credit unions, including the free services offered by credit union websites and the counselling offered by credit union associates. Thank you for your very informative post!
ReplyDeleteI think this was a phenomenal topic to write about Connor, as Credit Unions are on a decline, but it doesn’t mean they are a bad option at all. In fact, one could say that part of the reason is that lots of people don’t know the difference between a bank and credit union, especially at our age. So teaching the youth (us) about credit unions and their benefits may help us better understand which decision will be the best for us. You addressed each different benefit very in depth and provided lots of detail, and it really gave me a lot of insight into the benefits of a credit union!
ReplyDeleteCredit unions look really useful. I am surprised that they are on the decline! I wonder why more people aren't using them. Is it simply lack of awareness?
ReplyDeleteOverall a very informative post! I've actually never heard of credit unions before, so this article was all new information to me. I appreciated the breakdown of each benefit, as well as some context for its participation in the US.
ReplyDeleteYou did a really good job with this post, I didn't really know about credit unions and didn't know that they can help raise your credit score. This can benefit our generation because we like to spend a lot of money.
ReplyDeleteI had no idea that there were loans that you could take out specifically to help boost your credit score. You mentioned that credit unions are willing to help people who need help budgeting and other things like debt management. Credit counselors seem very similar to financial advisors that you can talk to at a bank. I know that sometimes you have to pay to meet with a financial advisor, but in this the case for credit counselors? If not, that is another reason to choose credit unions over banks.
ReplyDeleteI've never thought of a credit union as an option, but after reading this it seems really helpful and i never knew it could raise your credit score.
ReplyDeleteThe information I got from this piece was all extremely helpful. My dad for the past two years has been going through a credit union and I've never heard him say a bad thing about it so gathering some information about how a credit union works is amazing. I'm curious about the reasons the growth of credit unions continues to go down when there's nothing but positives to a credit union.
ReplyDeleteLove love love loveee the way you laid this out with such simple explanations making it easier to read. What would help this make it better is some examples that the reader can try or some scenarios a person may find when they do go to a credit union. There some places I had to reread just cause of the wording. I know I said simple explanations that made it easier to read, but eventually the process clicked after an extra second of rereading. Overall, still a great piece.
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ReplyDeleteI like that you included the situations that make the most sense for people to join credit unions as opposed to banks. I also like that your post showed a variety of services offered by credit unions, including the free services offered by credit union websites and the counselling offered by credit union associates. pm.mba/kaizen-20-keys-to-workplace-improvement-examples
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