How to Open Credit Union Checking Accounts

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How to Open Credit Union Checking Accounts

Because credit unions are focused on supporting members’ unique needs, they offer different types of accounts with various benefits and features. That means finding the option that aligns with your personal priorities for the account is easy. Follow these six steps to get started.

 

1. Find the Right Institution

With more than 5,000 credit unions in the U.S., you’re guaranteed to find the local credit union that blends your banking preferences with your lifestyle. It’s a common misconception that credit unions require special eligibility which can be hard to come by. But in fact, credit unions are organized and structured around common bonds or activities, such as through an employer, community, faith-based organization, or school. The many types of credit unions mean there’s a credit union out there for everyone. Here are some common credit union options:

• Community credit unions. Serve a specific geographic area and simply require residence within a defined region, such as your town, county, or state.
  
• College credit unions. Serve enrolled students, alumni, staff, and faculty.
  
• Group credit unions. Serve churches or other small organizations and limit membership to that specific group.
  
• Employer credit unions. Serve the employees of a specific company, profession, industry, or government agency. 
  
• Military credit unions. Serve active duty military, veterans, and military members. 
  
• Federal credit unions. National credit unions with limited membership restrictions, such as the need to be 18 years or older and a U.S. citizen.

Beyond determining the type of credit union you’d like to join, consider these factors when opening a credit union checking account:

• Balance requirements. Many credit unions offer no minimum balance requirements to maintain a credit union checking account, while some low minimum balance accounts need as little as $5 to keep open. Those that do require a minimum balance may have daily or monthly requirements.
  
• Fees. Credit union checking accounts often have no or low fees associated with your checking account activity. However, some no-fee checking accounts may require you to set up direct deposit or maintain a certain balance. To give you an idea of the savings you’ll experience with a no- or low-fee credit union checking account, fees commonly seen at banks include:
  
  • Monthly maintenance fees
    
  • Transaction fees
    
  • Overdraft fees
    
  • Out-of-network ATM fees
    
  • And many more 
    
• Access to branches/ATMs. Your credit union may be local, but the odds are it has a national ATM footprint. With most credit union checking accounts, you also have access to more than 30,000 shared credit union ATMs throughout the country that act as an extension of your local credit union. Many credit unions operate shared branches with other credit unions as well.
  
• Online/mobile banking. Most credit unions offer convenient online and mobile banking to view accounts, review statements, apply for loans, make transfers, and perform other critical functions. 
  
• Insurance. All federally charted credit union checking accounts are insured by the National Credit Union Administration. State-charted credit unions must follow the insurance regulations specific to their state.

 

2. Choose the Right Checking Account for Your Needs

Once you know which institution you’d like to join, it’s time to choose your checking account. You may have heard that credit union checking accounts have slightly different names than bank checking accounts. So, what are checking accounts at credit unions called? Credit union checking accounts are also known as share-draft accounts. To get technical, it’s because you’re buying a share in the credit union. But in reality, most people just use the term checking account.

To select the type of credit union checking account you’d like to open, start by considering which features and benefits are the most important to you. For example, you may want to prioritize a low minimum balance, or would rather not have to worry about overdraft fees. Here are several common types of credit union checking accounts: 

• Traditional checking account. Where you’re likely to also hear the term share-draft account, this ‘regular’ checking account does not pay interest but typically includes features like free mobile banking, direct deposit, overdraft protection, and free checks and debit cards.
• Free checking account. With valuable perks like free online/mobile banking, free debit cards, and free monthly e-statements, this is a great option for those looking to save money. But credit unions offer different versions of free checking accounts, and it’s important to determine if any requirements are involved, like a minimum balance.
• Student checking account. Different from a minor or teen account opened by a parent, student checking accounts cater to ages 18-24 and generally feature a sign-up bonus, little or no fees, cash back on debit card purchases, and other perks. (Worth noting: A minor account opened by a parent can easily convert to a student checking account.)
• Checkless checking. This alternative checking account — sometimes offered to members denied a traditional checking account because of poor credit — is structured so that all transactions are through a debit card. These accounts typically include free mobile/online banking and mobile check deposits. 
• Business checking account. Small businesses enjoy the benefits of a business checking account that help to run things easier, such as free mobile check depositing, monthly dividends, and unlimited free transactions.
• Interest-bearing account. Similar to a savings account in that this type of account can earn you money, an interest-bearing account earns interest based on its average monthly balance. The interest will be subject to taxation, and the account will likely require a larger minimum balance.
• Premium checking account. If you’re financially stable and secure, you may want to consider a premium checking account. In addition to earning interest, these accounts typically include such perks as waived ATM fees, higher limits on withdrawals and ATM transactions, discounted loan rates, free checks, money orders, and cashier checks.

 

3. Collect the Required Information

Now that you’ve weighed all the factors and picked the right credit union checking account for you, gather the information you’ll need to open your account. Collect these materials:

• Social Security number (SSN). The federal Social Security Administration issues every person this nine-digit number to track Social Security benefits and for other identification purposes. If you’ve lost your Social Security card, you can find details about getting a replacement here.  
  
• Identification. A driver’s license, passport, or other government-issued I.D. is typically sufficient.
  
• Date of birth. DOB is usually verified with a driver’s license or birth certificate. 
  
• Address. Your home address or you may be able to use a separate mailing address for correspondence, such as a P.O. box.
  
• Contact info. Generally, an email address and phone number.
  
• Bank account info. This is necessary if you’re going to fund your checking account via electronic transfer from another financial account. 
  
• Business information. If opening a business checking account, you’ll also need the following: 
  
  • your business employer identification number (EIN)
    
  • documentation of business incorporation
    
  • signatures from other business partners

 

4. Review Terms & Conditions

The terms and conditions of opening a credit union checking account are usually relatively standard, but it’s still important to review the details so there are no surprises. Standard terms and conditions include:

• Definitions of terms such as deposit, withdrawal, stop payments, transfers, and other banking activity
• Your rights and obligations as an account holder
  
• The credit union’s rights and obligations as your financial institution
  
• Liability and bylaw conditions

 

5. Submit the Application

Depending on the institution, applications for a credit union checking account may be submitted in person or online. If your credit union requires certain criteria for membership, such as employment or military service, you will need to provide this information as well. The application typically includes submitting the information detailed in Step 3 above, although in some cases, the credit union may also check your credit and financial background. 

6. Fund the Account

Congratulations, you’ve opened your credit union checking account! Once you deposit money into the account, you can start using it immediately. Fortunately, opening a credit union checking account typically requires a small deposit of between $5 and $25.  

You can fund your account using cash, check, debit card, or other electronic transfer. You can also set up direct deposit so that your paycheck is automatically deposited into the account each pay period. If you use your account to set up automatic bill payments, note that you will need to ensure enough cash is in the account to cover your bills.

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Further Resources on How to Open a Credit Union Checking Account

For further guidance on opening a credit union checking account, check out these resources: 

• Get advice on saving and investing. Make the most of your checking account with these tips from the National Credit Union Administration on ways to save, plan for the unexpected, and more.  
  
• Improve your financial literacy. Check out this resource directory on all things financial literacy from the federal Comptroller of the Currency.
  
• Follow the list. Love to operate with a checklist? Tick the boxes on this step-by-step guide to opening a credit union checking account from the Consumer Financial Protection Bureau.

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Open Your Credit Union Checking Account Today

Whether you’re looking into opening a checking account for the first time or simply want to switch to a more personalized membership with a credit union, you’re sure to find the credit union checking account that fits your financial needs. Use our helpful guide to find a credit union near you. 

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