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Have you ever stopped to think about the difference between a bank and a credit union? Probably not, most people don’t. In a lot of ways, they are not all that different, but there are some differences that can be helpful to understand.

Banks tend to be larger than credit unions, often with many branches across the country or even internationally, while credit unions are more often single branches or just a few branches in a particular region. Having a bank that is national can be helpful if you ever need to deal with your bank while traveling, but the flip side is that larger institutions can also sometimes feel impersonal. Likewise, because credit unions tend to be smaller, they often feel more personal. Thanks for modern technology, credit unions are only a phone call or email away if you need to get in touch while traveling.

Since banks are often larger, they also have the ability to place ATMs in many more locations that credit unions can. Some credit unions don’t have any ATMs at all. In order to try and compete with larger banks, many credit unions, and even smaller banks too, will offer to reimburse any ATM fees incurred by customers who must use an ATM that is not theirs.

Another major difference is that anyone can open an account at a bank, while credit unions only offer accounts to people who fall into a certain group. Often credit unions will be connected with a particular organization, and you must be connected to that organization in order to have an account there. For example, many larger universities will have a credit union, and any students, alumni and staff of that university can open an account there.

Credit unions are also non profit, where banks tend to be for profit businesses. Because credit unions are non profit, they are sometimes able to offer better interest rates on loans. That’s not always the case, but if you are shopping for a loan, it’s a good idea to look at both banks and credit unions, if you can.

Both banks and credit unions are insured up to $250,000, meaning that if the institution were to go out of business, the US government would pay you every penny you had in that institution up to $250,000. If you’ve got more than $250,000 in one institution, you are still only covered up to $250,000. The only difference is who does the insuring. Banks are FDIC insured (Federal Deposit Insurance Corporation), you’ve probably seen that logo on bank doors, or heard it at the end of TV or radio ads. Credit unions are insured by the National Credit Union Share Insurance Fund (NCUSIF), but both insurers serve the same function.

The similarities between banks and credit unions are mostly the things you would think about when you think about a bank. They both offer the same kinds of accounts, they will both charge fees for various things (although, again, credit unions tend to have lower fees), they will both allow access to ATMs in some form or another, and both offer the use of debit cards to access your money.

At the end of the day, there are reasons you might prefer to have your money in a bank, and there are reasons you might prefer to have your money in a credit union. It might even make sense to have an account at one of each, for the various ways you might use each. So long as you are careful not to incur any of those pesky fees, I’m all for it.