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Favorite Credit Unions of Savers


Favorite Credit Unions of Savers

What’s your favorite credit union? And what makes them your favorite? As a saver, the most important feature for me is a credit union that consistently offers the best rates. The best rates shouldn’t be just a one-time event. Top rates should regularly be offered.

It takes more than just rates. The credit union should be trustworthy. As we have seen over the years, there are a couple of credit unions that have failed on this. One example of this is a credit union that increased the early withdrawal penalty on existing CDs.

In addition to being trustworthy, the credit union should make it easy to join and apply for the accounts. Once the accounts are opened, the credit union should make it easy to manage the accounts. This requires an easy-to-use online account interface and competent and friendly customer service representatives who are easy to reach.

I thought it would be useful to list a few credit unions that meet the above criteria. They may not have the best rates today, but they have a long history of competitive rates. I’m limiting the list to those which make it easy for people to qualify for membership. So this list will be a subset of my Big List of Credit Unions Open to Anyone.

  1. Pentagon Federal Credit Union (PenFed) - This was an easy choice. Even though PenFed’s CD rates are not that competitive today, they have a long history of offering very competitive CD and IRA CD rates for a few months each year. They also make it easy open accounts and to manage the accounts. In addition to top CD rates, PenFed has some nice reward credit cards and very competitive rates on various loan products such as auto loans and HELOCs.
  2. Alliant Credit Union - Rates haven’t been quite as competitive as they used to be. Nevertheless, Alliant’s rates are still good enough for it to be on this list. Alliant still has competitive rates for its savings account, checking account and for some of its CDs. In addition, Alliant’s free checking account offers several nice features for a primary checking account.
  3. Melrose Credit Union - Since I started to track Melrose Credit Union in 2006, it has been offering competitive CD and IRA CD rates for terms from 1 to 5 years. The rates are always competitive and like now they can be very competitive. The only downside is a large and confusing early withdrawal penalty.
  4. Digital Credit Union - Every now and then DCU offers a very competitive CD special. The last one was in November when it was offering a 1.50% APY 8-month CD. DCU also offers some other nice perks like free monthly FICO credit scores.
  5. Connexus Credit Union - This is one of the few credit unions where you can get competitive rates on a money market account, an HSA, CDs and a reward checking account. In fact, its money market account has been on top of my list of the highest rate on a liquid account without a balance cap. The only downside is that it requires an active checking account with direct deposit to qualify for the top rate.
  6. Lake Michigan Credit Union - LMCU’s reward checking account called Max Checking has been around for over seven years, and through all of those years, the rates and balance cap have remained very competitive. LMCU also has an HSA with a long history of competitive rates with no monthly service fees.

This is just a list of a few of the all-access credit unions that have a long history of usefulness for savers. Please leave a comment about your favorite credit union(s) and why it’s your favorite.

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Shorebreak   |     |   Comment #1
I've been a member of Pentagon Federal Credit Union for over fourteen years now and it has to be at the top of my list as a favorite. I like their web site capabilities and the option to switch where one desires monthly dividends to go with a click of a mouse. The choices at maturity of a Money Market Certificate are made very simple also. Besides often having top-tier rate specials, PenFed has one of the best credit cards for purchasing gasoline, with their 5% discount per gallon Visa Platinum Cash Rewards card.
kcfield   |     |   Comment #2
I love Pen Fed's platinum Visa rewards cards, and sometimes I love their CD rates. However, their CD rates are inconsistent, so if one gets a CD at 3 percent, Pen Fed could be in a lower tier at maturity. Also, their savings rate at .10 is highly noncompetitive.
Anonymous   |     |   Comment #4
I think Penfed's service is very good overall.  The only bump was when they changed their rewards card w/o giving notice last year.  Overall I would recommend them highly.
kcfield   |     |   Comment #5
Not only did they change their rewards card without notice; they have also changed the redemption values without notice. It use to be 2500 points=25.00. Now it takes 3000 points to get 25.00 back. It is still a great card, but I don't like their lack of transparency and communication.
Anonymous   |     |   Comment #7
their home  equity and auto loan departments need to be completly overhauled. I wasted weeks trying to get a response to whether there was a question to what i submitted and after being told i would get a call back the next day. Numerous times without ever getting a call and after numerous calls asking for an update.  I gave up went to Navy federal and was approved in one hour.  I still have cd\s with penfed, but that will probably end when they mature because bad service and incompetence lead to banks ****ing up my account
Anonymous   |     |   Comment #16
You raise a good point re PenFed being less than truly open on some issues.  PenFed's records were "hacked" 3 to 4 years ago now, as I recall,  and to my knowledge PenFed never really disclosed how this hacking transpired--just that social security numbers and other customer data were compromised. PenFed did provide two years, I believe, of free credit bureau monitoring via a 3rvd party, and I received that benefit. Although PenFed has had some excellent loan and cd rates, so have many other credit unions all over the country--their is some competition in the industry, after all. Unfortunately, PenFed's hacking response seems too much like Target's handling of its hacking incident and the way both incidents have damaged the reputation of these entities to this customer of both organizations as far as I'm concerned. 
Anonymous   |     |   Comment #17
Does the Signature Visa card at Pen Fed require 3000 points to get $25.00?  If this is the case, then the Signature Card does not truly give 5% off at gas stations.
kcfield   |     |   Comment #19
It is the case with platinum rewards; I am not sure with signature Visa. You raise a good point though, that changing the redemption rates, is, in essence a contractual violation.
Anonymous   |     |   Comment #22
I want to see what the case is with Signature Visa.  Its well and good to give 5% in points, but what really matters is what you can redeem the points for in cash.
Anonymous   |     |   Comment #18
I'll correct my previous comment (#16) re PenFed's transparency/openness in that, although Target's being "hacked' seems clear, it was never clear to me if PenFed's customer information in its security incident a few years ago resulted from being "hacked" in a technical sense, or if the compromise of customer records in this incident were the result of actions of an insider or insiders that weren't "hacking" in a technical sense. However, as I noted in my comment, there seemed to be little openness/transparency re this security incident on the part of PenFed, and, as a customer who was informed that I was affected by the security compromise involving PenFed's customer information, I felt something was lacking.
Anonymous   |     |   Comment #25
Savings rate is now 0.05 percent. 
melman   |     |   Comment #3
When I entered the work force 30 years ago, I joined my employer's credit union.  I've long since left that employer, which is gone now but the credit union lives on with a new indepndent name.  I continue to use the credit union for basic services - I deposit my paychecks there, pay my bills, and any excess gets moved elsewhere.  Their ATM's always work, and I've never had an EFT problem.  But they've never ever had competitive rates.  I expect little of them, and they deliver on that.  I wonder if others have the same experience with their hometown credit unions.
klink   |     |   Comment #6
I became a member of PenFed based on comments by people here. I have a local branch which made getting CD's easy. Took advantage of the great 1yr's as they were paying more than the other credit union I am a member of. Things changed at maturity as the rates came down and my other credit unions rates on money market savings went up. So, Penfed gets a maintenance share acct. and a maintenance money market acct. to cover the Visa Platinum Rewards card. Activity in both required is at least every 6 months, so they get a dollar each. My other credit union is State Employees CU and there rates are excellent. Though I have 3 accounts with them the most used is the money market which is paying 1% at this time. Don't use ATM's as I don't trust them so all banking done during open hours or online.
Ally   |     |   Comment #8
Have belonged and still belong to several credit unions. I would have to say for rates in the past, and probably for the 3% this year that Pen Fed has come through. I can say for me customer service is tops, if we transferred in Dec every year for their higher rate, for RMD's, for credit card service (5% back on gas), and even when my husband passed splitting for the children when I disclaimed and offered to continue the 6.5% until maturity after it was split for them. My friend and also my youngest son had a HE loan with them. My friend was over 65 and gutted her home, and my son was on tour in Europe and a first time customer (a musician). In fact my friends daughter runs the mtg dept for a bank about 200 miles away and she drove up and did the loan for her on the computer after checking it out. She couldn't believe the rates and with no closing costs. 
I do love Lake Michigan and Inova credit unions for their reward checking accounts. Have had both for quite a few years. Customer service for both of them have been tops also. 
Anonymous   |     |   Comment #9
I don't know, maybe the one that has the best rates!  LMAO
51hh   |     |   Comment #10
I really do not care whether the credit union is my favorite; but the one which earns me highest dollar (i.e., what have you done for me lately?).  The rest means nothing to me.

dpandslemmen   |     |   Comment #11
Cool, my Lake Michigan Credit Union made the cut.  Just in the process of setting up several accounts with them (savings, checking, HELOC, Construction Loan/Mortgage). So far the process has been pretty smooth and the staff has been polite.
Gaelicwench   |     |   Comment #12
When I started working at Target, I decided to join Target Credit Union (actually owned by Baxter CU). It's got an excellent rating, and the customer service has been exemplary from the start. I've got their rewards checking, offering over 3%, and which hasn't gone done since I joined. It's free checking with no minimum balance.

Due to being unemployed (and going to school full-time for a career change), I've not had a chance to take advantage of their CDs and other products. But this will occur soon enough. They offer a couple of great credit cards with rewards I'd like to get eventually, too.

What I've always enjoyed about credit unions is that once you've been a member there, you're a member for life, even if you leave your place of employment. 
QED   |     |   Comment #13
Am member of (at least) fourteen credit unions (exact count oftentimes eludes me).

Alliant is best of them all, very avant garde.  They do a remarkable job.

I was wondering to myself, earlier this morning before visiting Ken's site, how many years it would be until other banking institutions catch up to Alliant.  Really, I dunno . . perhaps ten or twenty years.  It would be nice had I time to wait . . . . but I don't.  So I use Alliant today with gratitude I don't need to be young to have hope of experiencing Alliant's high level of service and technology.
QED   |     |   Comment #14

Make that sixteen credit unions . . I just thought of two more.
kcfield   |     |   Comment #20
Hi QED: Thanks for sharing about Alliant; I am not familiar with them. What specifically about their service and technology makes them excellent and avant garde?
Anonymous   |     |   Comment #23
I too like alliant, has free checking and savings and where they excel is they make an awesome hub bank.  very fast ach, awesome billpay and service.  Have even enjoyed their CC, and sometimes they have had top rates for cd's.  I only wish they would increase there savings/checking rate a little, .7% is a little below some of the others. 
QED   |     |   Comment #24
I agree with Anon #23.  Alliant is the perfect hub.  Their website is superb and there is no better way quickly to move money via ACH than with Alliant.  Alliant rates?  Decent, and I have a fair amount of money on deposit with them and pay my bills using their bill pay service.  But I also have funds on deposit elsewhere, using Alliant to facilitate and coordinate movement of those funds as required, overnight, for free.  Alliant also has low penalty fees and automatic movement of funds from savings to checking for a very low $3 fee if you mess up and overdraw.  In addition they have customer service which is 24/7 with helpful reps.
Anon 22540
Anon 22540   |     |   Comment #26
I have Alliant also, and love them. Though their rates have dropped a bit from what they used to be, never have I seen a more responsive -- and easy to deal with -- credit union that still offers very competitive rates. I originally signed up with them because they offered HSAs (Health Savings Account). I have my HSA with them currently (NO FEES of ANY KIND), and also have multiple savings accounts with them (NO ATM FEES on their end -- and they offer an ATM-only card for people who don't want another Visa or MasterCard-alligned debit card). I haven't yet switched my checking account over to them, but I may in time. I use them as much as I use my "primary" credit union, even though I don't live anywhere near an Alliant branch. They have easy access via phone, computer, or customer service rep. I can HIGHLY recommend Alliant... I've already sent a few friends there to become members. Absolutely nothing bad to say about them at all.
hoho   |     |   Comment #15
I have 6 CD's with Penfed and have a rewards card I use for 5% off of gas. Whenever I have dealt with then on the phone the service has been poor. I open CD's (and close) via the internet so I rarely deal with CSR's.
CC in CA
CC in CA   |     |   Comment #21
Provident Credit Union in Northern California has a very easy to use and high-rate (considering today's rate environment) rewards checking account at 1.76% on balances up to $25K.  Easy requirements to get this rate.  They have been my primary credit union for the past two years because of this (out of about 8 credit unions I have accounts with).  Also, they're a CU Service Center, so they are accessible from any other shared branch CU.
paoli2   |     |   Comment #27
I am partial towards Digital Federal Credit Union because they have Shared Branches which makes it very easy to withdraw monthly interest.  I liked their Shared Branch so much in my city that we opened a personal account and CD with them too.  Pentagon was great for giving us the 3% special but they do not have Shared Branches.
Anonymous   |     |   Comment #28
I'd like to see a credit union make this list that provides some "balance" in saving rates and loans, i.e. provide bonus dividends.  CUs are owned by the members and the members are owed a fiduciary duty.  Where/when is that duty going to be most displayed?  Bonus dividends are an answer being ignored by almost all.