Joining a credit union requires comparing different offerings, learning about membership qualifications, and funding your account. Unlike banks, which are open to the public, even the best credit unions often have membership criteria, so not everyone can join.

Find out how to determine whether a credit union would be a good fit for you, and how to join one.

Key Takeaways

• To join a credit union, you may have to meet the criteria for membership based on location, occupation, education, associations, or other factors.
• You may be able to join a credit union by donating to a particular nonprofit.
• Credit union membership can offer benefits like competitive rates and low or no fees.
• Disadvantages may include limited membership opportunities, fewer branch locations, and fewer services and product offerings.

What Is a Credit Union?

Credit unions are not-for-profit institutions that provide savings and loan services. Unlike a bank, account holders (members) own the credit union, so a credit union is driven by member interest, not producing a profit.

Credit union checking or savings accounts are often called share accounts to indicate members’ financial share in the institution. Members of many credit unions can use a network of more than 30,000 ATMs throughout the United States and Canada.

Credit unions offer many basic financial tools, including person-to-person payments, online bill pay, mobile apps, and online banking.

How to Join a Credit Union

Depending on the credit union’s criteria, joining could be straightforward or more involved. Here’s the basic process.

Step 1: Research Your Options

Identify what you want from a credit union, whether it is finding one with branches near your home for convenient in-person services or one with online services and competitive rates. 

Then, narrow your options. Investopedia’s Best Credit Unions list can provide a good starting point for comparing credit union offerings. For example, if you travel often and want to make in-person transactions, you may benefit by joining a credit union participating in the nationwide Co-op shared branch network of over 5,400 credit unions.

Note

Low-income credit unions (LICUs) and community development credit unions (CDCUs) are credit unions designed to serve low-income members with small-dollar loans, low minimum balance requirements, and other benefits. These credit unions may have simplified steps to join.

Step 2: Find Information on Membership Requirements

Credit unions often have requirements for who can become a member, meaning you can join or vote on leadership. Each credit union has different criteria for becoming a member. Review the credit union’s website to find membership information.

Next, confirm whether you’re eligible to join the credit union. The credit union will describe the field of membership requirements, which could include criteria such as: 

• Occupation: Such as military member, teacher, or employed by or retired from a specific business  
• Association: Being in a particular church; professional, civic, or fraternal group; or specific labor union
• Education: Students or alumni of a specific college, university, or school system
• Family: Being related to a current member 
• Region: Living, working, or attending school in a specific community or communities

Many credit unions offer an alternate way to join if you do not fit their criteria. For example, a credit union may allow anyone to join if they become a member of a specific nonprofit organization for a small fee. The credit union may pay any one-time membership fee—ranging from $5 to $25—to the nonprofit organization on your behalf, or you may need to pay this fee.

Step 3: Apply for Membership

You’ll often have an option of applying to join a credit union online, by mailed paper application, or in person. Make sure to have your legal name, address, date of birth, Social Security number, and other information on hand.

You’ll typically need to provide: 

• Your Social Security Number or Taxpayer Identification Number
• Government-issued ID such as a driver’s license or passport 
• Proof of address such as a utility bill or lease agreement
• Method for funding your new account (more on this below)
• Other eligibility documents such as a pay stub or school transcript

Note

If you want to open a joint account with your spouse or partner, or for a minor or business, call the credit union to ask about any special requirements. 

When you apply to join a credit union, the credit union may conduct a soft credit check or an inquiry into your banking history through ChexSystems when you open your account, which won’t affect your credit score.

If you have a troubled banking history, find out in advance whether the credit union offers accounts designed to provide you with basic services while preventing overdraft charges, often called “fresh start” or “second chance” accounts. They may charge extra service fees, but you may be able to upgrade to a standard account after a probationary period.

Step 4: Make a Deposit

Choose which type of accounts you’d like to open, such as savings, checking, or certificate of deposit (CD), and then make a deposit. Depending on the credit union, membership typically requires a minimum deposit of about $5 to $25 for a savings account, or share account.

A credit union may require you to have a minimum balance in your savings account, such as $10, $50, or $100. You may have a minimum balance requirement to earn a specified savings rate. 

Note

Depending on the credit union, you may be able to fund your account with a bank account and routing number, cash, a debit card, or even a credit card. 

Step 5: Read Your Account Disclosures and Agreement

After you’ve joined the credit union, make sure you fully understand the terms. Comparing terms should have been part of shopping for the right fit for a credit union for you, but you’ll want to review the terms again to be sure that you understand all the details.

Fine-print disclosures help you understand your new account and avoid unexpected charges. In particular, review your new accounts: 

• Fee schedules 
• Privacy policy
• Overdraft protection policy and opt-out
• Explanation of how dividends or interest-bearing accounts work

Credit unions usually prioritize member relationships, but they still may include charges and fees that are not obvious. Credit unions may charge fines on late credit card payments—but the average charge is under $25 versus fees of $36 to $40 found at top credit card issuers.

Advantages and Disadvantages of Joining a Credit Union

Pros

• Competitive savings rates: Credit unions often have better CD rates than banks.
• Low borrowing rates: Credit unions typically have lower interest rates on credit cards, some mortgage products, and car loans.
• Benefits: Credit unions may offer members discounts and/or cash back on services, car rentals, insurance, and online shopping. 
• Low or no fees: Credit unions typically don’t charge maintenance fees and may not require a minimum balance on checking accounts.

Cons

• Membership process: Joining a credit union can entail a membership process if the credit union’s field of membership is narrow.
• Limited locations and hours: Credit union branches and ATMs likely won’t be as widespread or accessible as with national banking options, so you may need to conduct more business by phone or online. You may also have a hard time finding an international Co-op ATM.

Pros

• Competitive savings rates

• Low borrowing rates

• Benefits

• Low or no fees

Cons

• Membership process

• Limited locations and hours

How to Choose a Credit Union

First, you’ll need to make sure that the credit union you choose will accept you as a member. Then, consider making sure it has some or all of the following benefits:

• Savings protection: Deposit insurance of up to $250,000 for your savings and checking accounts
• ATM access: Access to the Co-op ATM network and ATM fee rebates
• Fees: No or low monthly fees for services
• Checking accounts: No account minimums and free checks
• Free financial planning: Budgeting, paying off debts, and other assistance with financial wellness
• A mobile app: To check balances and use mobile check deposit
• Tech integration: Methods to easily transfer funds or pay bills

For many potential members, a commitment to community contributions is also important, so you may want to review the credit union’s annual report and history of giving.

What Is a Credit Union Field of Membership?

A credit union’s field of membership defines the types of people whom a credit union may enroll as members. Each credit union will have its own defined membership. For example, one credit union may only enroll people living within a specific county as members, while another may enroll people in specific occupations.

What Is the Difference Between a Privately and Federally Insured Credit Union?

Most credit unions are federally insured. Around 98% of federally insured credit unions have member deposits insured up to $250,000 by the National Credit Union Share Insurance Fund (NCUSIF). However, a small percentage of credit unions privately insure deposits by a company called American Share Insurance (ASI). The credit union should disclose how member deposits are insured, the amount of coverage, and how coverage works.

What Is the Interest Rate on a Credit Union Savings Account?

As of Q4 2023, the average interest rate for a regular savings account on a $2,500 balance was 0.20%—lower than at a bank, which averaged 0.34%. You may want to look into credit union money market savings accounts or credit union certificates of deposit (CDs), which on average pay higher interest than a bank.

The Bottom Line

Joining a credit union can make sense if you want to benefit from a specific credit union’s higher CD interest rates, lower loan rates, and no-fee checking. However, joining a specific credit union can be challenging because of the potential for membership requirements.

If you want to join a particular credit union due to great savings rates or another reason, but you don’t meet membership criteria, call to see if there’s another way you can qualify to be a member.

Article Sources Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.

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2. Co-op Solutions. “Co-op ATM Network.”

3. Co-op Solutions. “Co-op Shared Branch.”

4. National Credit Union Administration. “Low Income Credit Unions.”

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6. Consumer Financial Protection Bureau. “Checklist for Opening a Bank or Credit Union Account,” Pages 1–3.

7. Consumer Financial Protection Bureau. “What’s a Credit Inquiry?”

8. United Financial Credit Union. "Fresh Start Checking Account.”

9. First American. “Second Chance Checking.”

10. National Credit Union Administration. “Why Reading Account Disclosures Is Important.”

11. Consumer Financial Protection Bureau. “Credit Card Late Fees,” Page 15 (Page 16 of PDF).

12. National Credit Union Administration. “Credit Union and Bank Rates 2023 Q4.”

13. Co-op Solutions. “Co-op ATM Network.”

14. National Credit Union Administration. "Credit Union Share Insurance Brochure," Page 1.

15. National Credit Union Administration. “Choose a Field of Membership.”

16. National Credit Union Administration. “What Is NCUA?”

17. American Share Insurance. “Primary Share Insurance.”

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