HOW DOES A CREDIT UNION OPERATE?

  • A group of people with a common bond (employment, community, organization, etc.) pool their savings, and elect individuals from their ranks to manage and protect those funds.
  • The funds are made available to fellow members as relatively inexpensive loans.
  • The interest earned from the loans pays the costs of operation of the credit union. Part of the profits of the credit union is put into reserves and undivided earnings for possible loan losses, and to maintain stability in the event of any future uncertain economy.
  • Surplus earnings are then returned to the members/owners as dividends (interest) on savings, low interest rates for loans and an array of sophisticated financial services.
  • The dollars you invest with Contra Costa Federal Credit Union become "Shares of Ownership" and afford the members part-ownership of the credit union. Accordingly, your credit union savings account is also called a "Share Account."
  • The interest you earn on your savings is called a "Dividend." The Board of Directors of the credit union declare the dividend at the close of each business quarter based on net earnings. The credit union pays dividend on every single dollar invested (deposited) with the credit union - for every day you leave it on deposit.

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