Why Now Is A Great Time To Consider A Credit Union Credit Card (2024)

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The not-for-profit nature of credit unions means your small, local credit union may not be filling your mailbox or Google feed with ads, but that doesn’t mean you should overlook them. Throughout their 115-year history in the U.S. credit unions have existed to serve their members. This includes offering better rates and terms to their members.

During this season of higher inflation and rising credit card debt, switching to a credit union as your card provider may be an excellent choice for your household finances.

Credit Union Credit Cards vs. Bank Credit Cards

Banks and credit unions are both financial institutions that issue credit cards. The primary difference is that anyone can apply for a bank credit card, while credit union credit cards are only available to credit union members. In most cases credit unions require that you deposit at least $5 as a member share in order to join, and that you meet other credit union membership requirements.

Although many credit unions do offer some card rewards, they do have a reputation for offering lower rewards than bank cards. The trade-off is that they often offer lower APR as well.

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Navy Federal More Rewards American Express® Card

On Navy Federal Credit Union's Website

Welcome Bonus

Earn 30,000 bonus points + LTO $98 Statement Credit for an Annual Walmart+ Membership

Annual Fee

$0

Credit Score

Fair,Good,Excellent

Regular APR

14.90%-18.00% variable APR

Credit Score ranges are based on FICO® credit scoring. This is just one scoring method and a credit card issuer may use another method when considering your application. These are provided as guidelines only and approval is not guaranteed.

Earn 30,000 bonus points after spending $3,000 within 90 days of account opening. Plus for a limited time, earn a one-time $98 statement credit when you pay $49 or more for an annual Walmart+ membership using your More Rewards credit card. Offer available from 7/1/2024 - 9/2/2024.

Navy Federal Credit Union Visa Signature® Flagship Rewards Card

On Navy Federal Credit Union's Website

Welcome Bonus

40,000 bonus points + Amazon Prime®

Annual Fee

$49

Credit Score

Good,Excellent

Regular APR

15.24%-18.00% variable

Credit Score ranges are based on FICO® credit scoring. This is just one scoring method and a credit card issuer may use another method when considering your application. These are provided as guidelines only and approval is not guaranteed.

Earn 40,000 bonus points (a $400 value) when you spend $3,500 within 90 days of opening your account. Plus a free year of Amazon Prime® worth of $139 value. Offer available from 7/1/2024 - 9/2/2024.

Pros and Cons of Credit Union Credit Cards

Pros

  • Lower APR. It’s possible to find credit union credit cards offering regular APRs that fall significantly below the national average. If you carry a balance, a low APR could save you hundreds
  • Fewer fees. Credit unions often offer cards with no balance transfer, cash advance, foreign transaction or annual fees. While you may find some of these perks on traditional bank credit cards, it’s rare to find a card offering all four.
  • Opportunities to build credit. While any credit card gives you the opportunity to build credit, credit unions may be willing to approve applicants that may be denied by traditional banks. Additionally, credit unions often offer secured credit cards with fewer fees and lower APRs, which could be great for those who need to build their credit.
  • Investing in the local community. Many credit unions contribute a portion of their proceeds or each transaction to the local community. If you prioritize shopping local, this may be another way to give back to your community.

Cons

  • Credit union membership is required. Before you can apply for a credit card, you must first qualify for and join the credit union.
  • Lower rewards and fewer added perks. Many banks seek to lure you in with higher rewards or travel perks. However, these benefits are often paid for with a higher APR. If these aren’t benefits you use, a credit union credit card may be a better choice.

Impacts of High Interest Rates

Credit card balances have been hitting new records, with the New York Federal Reserve now reporting more than $1 trillion in U.S. household credit card debt. At the same time, the average national credit card APR is above 20% and hovering near all-time highs. If you’re one of the countless Americans facing a credit card balance, you’re well acquainted with the pain points. In fact, your interest rate may be even higher.

Credit card interest is expressed as an annual percentage rate (APR), which can make it difficult to calculate the true impact. Since credit card interest generally compounds daily, even a 1% or 2% increase in your APR can make a tremendous difference.

Examine the chart below to see your estimated time to payoff and total interest costs with different APRs.

Credit Card BalanceInterest Rate (APR)Minimum PaymentTime to PayoffTotal Interest Costs

$1,500

11.99%

$45

3 years, 5 months

$333.39

$1,500

13.99%

$45

3 years, 7 months

$410.28

$1,500

15.99%

$45

3 years, 9 months

$496.60

$1,500

18.99%

$45

4 years

$648.80

$1,500

22.99%

$45

4 years, 6 months

$913.60

$1,500

26.99%

$45

5 years, 3 months

$1,302.57

$1,500

29.99%

$45

6 years, 1 month

$1,763.52

The minimum payment above assumes a flat 3% rate. It’s not uncommon for credit card companies to only require a 1% or 2% minimum payment, which would significantly extend the time needed to pay off the debt and the interest paid. Other credit card providers may use a percentage of your balance plus any new interest or fees, so a higher APR would raise your minimum payment and still result in larger interest fees.

If these numbers seem daunting, don’t be discouraged. Making even slightly more than your minimum payment can have a huge impact on debt reduction.

Credit Card BalanceInterest Rate (APR)Minimum Payment + $10Time to PayoffTotal Interest CostsSavings

$1,500

11.99%

$55

2 years, 8 months

$259.98

$73.41

$1,500

13.99%

$55

2 years, 10 months

$315.77

$94.51

$1,500

15.99%

$55

2 years, 11 months

$376.57

$120.03

$1,500

18.99%

$55

3 years

$478.88

$169.92

$1,500

22.99%

$55

3 years, 3 months

$642.39

$271.21

$1,500

26.99%

$55

3 years, 7 month

$850.21

$452.36

$1,500

29.99%

$55

3 years, 11 months

$1,050.08

$713.440

In fact, the higher your APR the greater the impact of extra payments. If you’d like to dive deeper into how extra payments can reduce your interest, checkout Forbes Advisor’s credit card payoff calculator.

How Credit Union Credit Cards Can Reduce Your Interest Payments

Balance Transfers

Many people consider a balance transfer to reduce the interest rate on current credit card debt. Credit union credit cards may be an excellent option to reduce your APR. Some credit unions offer a 0% introductory APR on their credit cards. Other credit union cards may charge a low introductory rate, but charge no balance transfer fees. Introductory terms on credit union credit cards tend to be shorter than traditional bank credit cards, but likely charge a lower regular APR for any ongoing balances.

When transferring credit card debt to pay off the balance, determine if you can realistically pay the full balance in the introductory period while making no additional purchases. If this process seems daunting, a credit union credit card may be a strong choice. This option could reduce your APR for a short term with an introductory APR, and still give you an APR discount even after your introductory period ends.

While the longer introductory APRs for bank credit cards may seem more appealing, you may be facing higher balance transfer fees. And unless the card offers a 0% intro APR on both purchases and balance transfers, you will likely be paying regular APR on any purchase you make—with no grace period.

Lower Purchase APR

If you’ve paid off credit card debt before, you know the challenge a high APR presents. If you don’t currently carry a balance, choosing a credit card with a low APR could be a wise call. If your income is sporadic or you want to be prepared for an emergency, having a credit card with a low APR could be a wise choice.

Even if it’s not your primary card, with no annual fee, it may be wise to add a low APR card to your wallet. Having an option to pay lower interest if the need to carry a balance may give you more peace of mind down the road.

Best 0% APR & Low Interest Credit Cards Of 2024

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When Is a Low APR Better Than a Rewards Card?

If you need to carry a balance, even periodically, having a low APR will save you significantly more money. Flat-rate rewards credit cards can earn 2% and depending on the spending category, you could earn up to 6% on select purchases. With credit card APRs averaging 22.77% nationwide, carrying a balance any given month would decimate your rewards.

If you don’t consistently pay your balance in full each month, giving up the rewards for a low-interest card will save you a bundle.

What To Consider When Choosing a Credit Union

Eligibility Requirements

Credit unions are chartered or licensed as financial institutions designed for people who share a common interest or “field of membership.” Therefore, members must meet the requirements laid out by the credit union field of membership. Credit union membership can be based on your:

  • Employer. Some credit unions are formed for military service members, specific labor unions or industries. They may also serve any employee that works for an affiliate group.
  • Family. Many credit unions allow families of qualified members to join often including spouses and children. In some cases, membership is open to parents, grandparents, siblings, grandchildren and household members, as well.
  • Geographic location. You may find credit unions open membership to anyone working, living, attending school or worshiping within a specific county or state.
  • Group member. Credit unions may accept school alumni, professional organizations or a contribution to an affiliate nonprofit.

Member Share Cost

Credit unions are owned by their members. When you join a credit union, you’re typically required to buy in to the organization, like purchasing a share of a company. This member share is usually only $5 to $10 and is held in a member share account. Your share deposit will be held for the lifetime of your account ownership.

Balance Transfer APR and Fees

If you’re considering a balance transfer, look for credit cards that offer a 0% or lower introductory APR on balance transfers. You also need to evaluate any fees for balance transfers. It’s not uncommon to find credit unions that don’t charge balance transfer or cash advance fees. If you travel internationally, make sure to look for credit cards with no foreign transaction fees.

Ease of Digital Banking

One common drawback for credit unions is fewer digital banking tools. Their smaller size may mean fewer dollars for in-house development. While there are some credit unions with robust online and mobile banking presence, others may prove more challenging to access digitally. Read the reviews and make your own decision as you navigate their website.

Other Benefits from Credit Union Membership

As a credit card member, you may qualify for discounts. Boeing Credit Union (BECU) offers member discounts to University of Washington and Washington State University football games, while Premier Members Credit Union (PMCU) offers discounted tickets to Water World. Other credit union memberships include discounts on car insurance, car rentals, local merchants and cellphone protection.

Before assuming there are no credit card perks, review the credit union membership benefits to see what’s offered.

Read the Fine Print

As with any financial product, it’s wise to read the fine print before applying. Because credit unions are managed by their members, you may find credit card policies or terms outside what you find in a bank credit card. It’s also important that you read and understand the terms of credit union membership.

Credit Union Credit Cards With Low APR

Credit unions often offer credit cards with APRs significantly lower than bank issued cards. You may find that credit union credit cards offer fixed-rate APRs, making any interest you may need to pay more predictable.

UNIFY Visa Platinum Credit Card*

Rewards: This card does not earn rewards.
Welcome offer: This card does not offer a welcome bonus.
Annual fee: $0
Regular APR: 9.49% to 17.74% fixed APR or 14.24% to 17.99% variable APR
Introductory APR: 5.49% to 13.74% introductory APR for a period of six billing cycles for purchases and 12 billing cycles for balance transfers, based on your creditworthiness. 9.49% to 17.74% fixed APR or 14.24% to 17.99% variable APR thereafter
Membership requirements: Eligibility can be based on living within a qualified zip code, working at a company that offers UNIFY benefits or by becoming an affiliate member of Friends of Hobbs, a non-profit state park. UNIFY Credit Union will pay your required contribution.
Other benefits: This card offers auto rental collision coverage, plus travel and emergency assistance.

Signature Visa® Platinum Credit Card*

Rewards: Earn 6 points per dollar on all streaming services and 1 point per dollar on all other purchases.
Welcome offer:This card does not offer a welcome bonus.
Annual fee: $0
Regular APR: 10.99% - 17.99% APR for purchases and balance transfers
Introductory APR: There is no introductory APR with this card.
Membership requirements: Open to anyone, but requires a $5 deposit into a basic savings account.
Other benefits: This card doesn’t offer any bells or whistles. Don’t get excited about the cellphone protection. The card offers minimal coverage up to $100, but that’s after a $50 deductible.

Suncoast Rewards Platinum Credit Card*

Rewards: Earn 2% cash back on gas, groceries and tolls, 1% on all other purchases
Welcome offer: This card does not offer a welcome bonus.
Annual fee: $0
Fixed-Rate APR: 12.5% to 18.0% APR for purchases. 14.5% to 18.0% APR for balance transfers, based on your creditworthiness
Introductory APR: There is no introductory APR with this card
Membership requirements: Anyone who lives, works, worships or attends school in one of the around 40 Florida counties served by Suncoast
Other benefits: You’ll receive 0% liability coverage and travel insurance when you purchase plane tickets with this card. There is also no cash advance fee and rewards never expire.

Credit Union Credit Cards With Competitive Rewards

You may find that credit unions credit cards earn higher rewards, especially if you hold another account with the credit union. This strategy is an attempt to become your primary financial institution, but for some people these cards may still work even without switching banks.

Navy Federal cashRewards Credit Card

The Navy Federal cashRewards Credit Card offers consistent rewards for any cardholder, but members with direct deposit in a qualified Navy Federal Credit Union (NFCU) account earn 1.75% on all purchases.

Rewards: Earn up to 1.75% cash back on all purchases (enroll and maintain direct deposit required; 1.5% cash back earned otherwise).
Welcome offer: Earn $300 bonus cash back after spending $3,000 within 90 days of account opening. Plus a LTO of $98 statement credit after paying $49 or more for an annual Walmart+ membership using your cashRewards credit card. Offer available from 7/1/2024 - 9/2/2024
Annual fee: $0
Regular APR: 14.90% - 18.00% variable APR for purchases and balance transfers, balance transfer fee not applicable
Introductory APR: N/A
Membership requirements: Veterans, activity duty and retired service members, DoD civilian employees and family members
Other benefits: Get a one-time $98 statement credit when you pay $49 or more for your annual Walmart+ subscription with your card. This card also has no balance transfer fee. All NFCU members qualify for discounts on Liberty Mutual auto and home insurance, Visa special offers, Hertz and Enterprise car rentals.

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Navy Federal cashRewards Credit Card

Apply Now Why Now Is A Great Time To Consider A Credit Union Credit Card (3)

On Navy Federal Credit Union's Website

3.3

Why Now Is A Great Time To Consider A Credit Union Credit Card (5)

Forbes Advisor created additional star ratings so that you can see the best card for specific needs. This card shines for this use, but overall the star ratings may differ when compared to other cards.

Apply Now Why Now Is A Great Time To Consider A Credit Union Credit Card (6)

On Navy Federal Credit Union's Website

Up to 1.75X Reward Rate

Earn up to 1.75% cash back on all purchases (enroll and maintain direct deposit required; 1.5% cash back earned otherwise).

Welcome Bonus

$300 cash back + LTO of $98 statement credit on annual Walmart+ membership

Annual Fee

$0

Regular APR

14.90%-18.00% variable APR

Credit Score

Fair,Good,Excellent(700 - 749)

Editorial Review

If you prefer cash back, this is an option for decent rewards. If you bank with Navy Federal and get a direct deposit, you’ll earn a little more—which is always a good thing.

Pros & Cons

  • No annual fee
  • No foreign transaction fees
  • No balance transfer fees
  • Low regular APR on purchases
  • Mediocre cash-back rewards
  • Direct deposit with Navy Federal is required to received the full 1.75% cash back

Card Details

  • Earn $300 cash back after spending $3,000 within 90 days of account opening. Additionally, earn a one-time $98 statement credit when you pay $49 or more for an annual Walmart+ membership. Offer available from 7/1/2024 – 9/2/2024.
  • Earn up to 1.75% cash back on all purchases to members with direct deposit at Navy Federal
  • No annual fee
  • No rewards limit

Earn $300 cash back after spending $3,000 within 90 days of account opening. Additionally, get a one-time $98 statement credit when you pay $49 or more for an annual Walmart+ membership. Offer available from 7/1/2024 - 9/2/2024.

Credit Score ranges are based on FICO® credit scoring. This is just one scoring method and a credit card issuer may use another method when considering your application. These are provided as guidelines only and approval is not guaranteed.

Alliant Cashback Visa® Signature Credit Card*

The Alliant Cashback Visa® Signature Credit Card* comes with some solid bonuses. Anyone can become a member of Alliant Credit Union. If you work and live outside of the qualifying neighborhoods or companies, you can become an Alliant Credit Union Foundation digital inclusion advocate. You must hold an Alliant High-Rate Checking account to earn the full rewards, but this account has no service fees, earns an elevated APY and offers a $20 monthly ATM fee rebate.

Rewards: Earn 2.5% cash back on up to $10,000 in eligible purchases each billing cycle and unlimited 1.5% cash back on all other eligible purchases.
Welcome offer: This card does not offer a welcome bonus.
Annual fee: $0
Regular APR: 17.49% - 27.49% variable APR for purchases and balance transfers, based on creditworthiness. A balance transfer fee of 3% of the amount of each transfer applies.
Introductory APR: This card offers no introductory APR offer.
Membership requirements: Current or retired employee of an Alliant partner business or organizations, those who live or work in a Chicago community near Alliant Corporate Headquarters, domestic partners or immediate family of current Alliant members. If you do not meet these requirements, you can become an Alliant Credit Union Foundation digital inclusion advocate, an organization whose mission is to provide reliable digital access resources to underserved communities including rural and digitally-challenged populations. Alliant will make a one-time $5 contribution to the Foundation on your behalf.
Other benefits: This card comes with travel accident insurance, auto rental collision damage coverage, purchase and extended warranty protection.

PenFed Pathfinder® Rewards Visa Signature® Card*

The PenFed Pathfinder® Rewards Visa Signature® Card* comes close to competing with bank issues travel cards you may be familiar with, as long as you qualify for PenFed Honors Advantage membership. To qualify you must maintain a PenFed checking account or the primary applicant must be a military service member.

Rewards: Earn 4 points per dollar on all travel categories for PenFed Honors Advantage Members, 3 points per dollar on all travel categories and 1.5 points on all other purchases.
Welcome offer: 50,000 bonus points after spending $3,000 in the first 90 days of account opening.
Annual Fee: $95 (waived for existing PenFed Honors Advantage Members)
Regular APR: 17.99% Variable
Introductory APR: 0% introductory rate for 12 months on balance transfers made in the first 90 days after account opening, followed by a non-variable APR rate of 17.99%. Balance transfers incur a 3% fee per transaction. A 17.99% variable APR applies for purchases
Membership requirements: Membership is open to everyone.
Other benefits: Cardholders can receive $100 statement credit for ancillary domestic air travel, up to $100 statement credit for Global Entry or TSA PreCheck® and complimentary Priority Pass membership. Plus, you’ll receive access to all the PenFed member discounts.

Is a Credit Union Credit Card Right for You?

Credit union credit cards can be a big win if you need to carry a balance since many credit union cards offer lower APRs than their bank counterparts. They’re also a solid option if you’re looking to build credit. Those with less-than-perfect credit may find it easier to get approved for a credit card through a credit union rather than a traditional bank, especially if you already have a relationship with your credit union.

You won’t be wowed by the rewards or perks that many of these cards offer, but there are a few standout exceptions to that rule. And since most don’t charge an annual fee, a credit union credit card may be a wise addition to your wallet for those seasons when finances get a little rocky.

Find The Best Credit Union Credit Cards Of 2024

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Frequently Asked Questions (FAQs)

Is it easier to get a credit card from a credit union?

While every credit union sets its own eligibility requirements for credit cards, it may be easier to get a card through a credit union. These financial institutions are not-for-profit and are member owned and operated. Unlike banks that are focused on generating money for their stockholders, credit unions may have more flexibility regarding their approval process. If you already have an established relationship with a credit union through a checking or savings account, you may be more likely to be approved than through a traditional bank.

Is my money safe in a credit union?

Your member shares deposit and any funds held in a deposit account like a checking or savings account are as safe in a credit union, as they are in a bank. While the FDIC insures banks, the National Credit Union Administration (NCUA) insures deposits in credit unions. Your deposits are insured up to a total of $250,000 in all deposit accounts within the credit union.

What is the difference between a fixed rate and a variable rate credit card?

A variable rate means that the interest rate you pay will fluctuate as the prime rate changes. With a fixed-rate card your APR is set, making your payments more predictable. Card issuers can raise your fixed-rate APR, usually based on cardholder behavior like late or missed payments. However, your card issuer must provide written notification 45 days before the new APR takes effect.

Why Now Is A Great Time To Consider A Credit Union Credit Card (2024)

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