Bank Failures Offer Reminder of Credit Unions’ Soundness, Reliability

How to keep your money safe in the wake of two major bank collapses.

So, you’ve read that the Silicon Valley Bank and New York’s Signature Bank collapsed and you’re wondering: “Is there anywhere safe for me to put my money?”

The answer is “Yes.”

Join a credit union.

Unlike those two huge financial institutions with few links to their communities, credit unions are not-for-profit financial institutions owned by their members.

That means the credit union’s board of directors is answerable to you—the member-owner. If you don’t like how a credit union is being run, you have the power to replace its directors.

That’s not the case at banks like Silicon Valley and Signature. There, the shareholders owned the bank and depositors had little say as to how the financial institutions were operated.

How Your Money Is Protected at a Credit Union

Your money is safe at a federally insured credit union, where accounts of up to $250,000 are insured by the National Credit Union Administration’s Share Insurance Fund.

Following the bank failures, Dan Berger, president/CEO of the National Association of Federally Insured Credit Unions, pointed out that 90% of the deposits at credit unions are insured by the federal government, compared with only 50% of bank deposits.

NCUA Chairman Todd Harper added that the Share Insurance Fund is healthy and sound, while noting that no one has ever lost a single cent of insured share deposits at their federally insured credit union.

So, rather than worrying about which banks are safe, put your money in a credit union instead and have your own say in how the institution is run.