At your credit union, you’re not just a customer, you’re a member of a successful financial co-operative. Your savings with the credit union are called “Shares”. If the credit union has accrued a surplus at the end of the financial year it may declare a dividend. If so, you will get a return on each share you hold.

Is a credit union a shareholder?

Unlike most other financial institutions, credit unions do not issue stock or pay dividends to outside stockholders. Each credit union member has equal ownership and one vote—regardless of how much money a member has on deposit. At a credit union, every customer is both a member and an owner.

Why is a savings account at a credit union referred to as a share account?

It’s because the “share” in question is your financial share in the organization. At a credit union you aren’t just a customer: you’re a member with a financial stake in the union. Your savings account represents your share of the credit union, thus it’s called a “share account” (or sometimes a share savings account).

How does shares work in credit union?

Owning shares qualifies you to become a member of a Credit Union. It is an investment that produces long term returns. At Works Credit Union each share is at a fixed rate of $5.00 per share. The shares gains dividends or interest on a yearly basis.

Can you take money out of your shares in the credit union?

Credit union savings are usually held in share accounts but some also offer deposit accounts. You can withdraw your money on demand from most credit union accounts, but you may have to keep a certain amount of savings if you also have a loan with that credit union.

What is a savings account at a credit union called?

A share account is a savings or checking account at a credit union. Share savings accounts pay variable dividends, the equivalent of a bank account’s interest. Share checking accounts, called draft accounts, are liquid and meant for payments and everyday spending.

What happens to your credit union shares when you die?

Credit union accounts They do not form part of the deceased’s estate. The balance of the account forms part of the deceased’s estate and is distributed in accordance with succession law.

What does it mean to have share account in credit union?

The term “share” refers to your share of ownership in the credit union. Although you can have a joint share savings account, share accounts can also be individual accounts. Credit unions typically pay interest on your deposits in a share savings account in the form of dividends based on your share.

What happens when you deposit money into a credit union account?

When you deposit money into your bank checking account, your money is still your money. You can withdraw those funds on demand, typically by writing a check. When you deposit money into your credit union share draft account, you are actually buying shares in the credit union, with each share being worth $1.

What makes up the total deposit in a credit union?

Total Deposits for credit unions are the sum of Total Shares of the credit union and non-member deposits. Each member owns a part of the credit union against the deposits made by them. Hence the credit union member’s deposits are defined as shares. The profits and savings against the total deposits are shared among the members.

What does a deposit in a bank account mean?

Your deposits in a bank interest-bearing checking account represent a loan to the bank. The bank is a private commercial business, and you are the bank’s customer. Your deposits in a credit union share draft account buy shares in the credit union.