Could Your Next Stockbroker Be a Credit Union?

Can a not-for-profit credit union, like First Financial, give you the same level of service as a for-profit commercial bank? On many fronts, the answer is a resounding yes!

Credit unions have plenty of features that make them an attractive alternative to America’s big commercial banks:

  • Good rates on loans: As a general rule, credit unions are run for the benefit of their members rather than for the benefit of owner-shareholders. As a result, they’re often able to offer low interest rates on credit cards and other loans that few of their for-profit banking peers are able to match.
  • Competitive dividend rates on deposits: Credit unions are often able to easily trump the national average of 0.1% dividends paid on savings and money market accounts.
  • Lower fees: The majority of America’s credit unions have maintained the benefit of “free checking,” when very few of America’s big commercial banks still offer the service.

But for investors, there’s still one big hole in the credit union story: stock trading.

In the competitive, complex world of banking services, it’s a reasonable question: Do credit unions offer online brokerage accounts? Is there a credit union out there where you can open a checking account, sign up for a credit card, take out a car loan, and trade stocks, all in one shop?

As it turns out, there is. Or rather, there are. Quite a few of them, including First Financial.

Time to Meet the Broker

According to Bankrate.com, there were 7,351 credit unions operating in the United States at the end of 2011, handling nearly $1 trillion in assets and serving 93.9 million customers.

Now granted, not all of these credit unions offer brokerage services. That’s not surprising. After all, not all banks offer online stock trading.

What’s actually more surprising is that quite a few credit unions do offer brokerage services, usually by teaming up with outside brokers.

A recent article in industry publication Credit Union Times, for example, described how INVEST Financial — a subsidiary of Britain’s Prudential (PUK) — teamed up with nine separate credit unions, to offer their members brokerage services.

CUSO or CUNA Who?

Now admittedly, most of these brokers aren’t exactly household names. If you’re looking for a credit union that’s partnered up with a Charles Schwab (SCHW) or E*TRADE Financial (ETFC), you may be in for a long search.

As the first couple of letters of these brokers’ names — “CUSO” and “CUNA” — suggest, at least some set up shop with the specific intent of targeting the specific market niche of Credit Union members. That said, the brokers listed don’t look to be fly-by-night shops.

San Diego-based CUSO Financial Services, for example, has been in business since 1996. CUNA Brokerage is a division of Madison, Wisconsin-based CMFG Life Insurance. Here at First Financial, our Investment and Retirement Center partners with CUNA Mutual Group to provide our members with investment, insurance and brokerage services.

So if you’re dead-set against big banks but don’t want to give up on the idea of managing your own retirement portfolio — you may not have to. There are options out there for people who’d like to switch to a credit union but who also want to keep trading stocks, mutual funds, and ETFs. First Financial can do that for you!

If you would like to set up a no-cost consultation with the Investment & Retirement Center located at First Financial Federal Credit Union to discuss your brokerage, investments, and/or savings goals, contact us at 866.750.0100 option 6.

Representatives are registered, securities are sold, and investment advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC , a registered broker/dealer and investment advisor, 2000 Heritage Way, Waverly, Iowa 50677, toll-free 800-369-2862. Nondeposit investment and insurance products are not federally insured, involve investment risk, may lose value and are not obligations of or guaranteed by the financial institution. CBSI is under contract with the financial institution, through the financial services program, to make securities available to members. CUNA Brokerage Services, Inc., is a registered broker/dealer in all fifty states of the United States of America.

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