Students learn about banks and credit unions, identifying similarities and differences between the two types of financial institution. They also evaluate a local bank and credit union to determine which one would be better suited to their needs. (This is Part I of a two-part project.)
Banks and credit unions are both financial institutions where you can have checking accounts and savings accounts. So what’s the difference? Initially established for different purposes, today’s banks and credit unions are looking more and more like each other, but there are still some major differences. Lately, there’s been a lot of controversy about one of those differences – that while banks pay taxes as for-profit organizations, credit unions remain largely untaxed. Your students will discover the differences and similarities between banks and credit unions and draw conclusions about which they would choose based on criteria important in selecting a savings institution.
- Identify the differences and similarities between banks and credit unions.
- Locate local banks and credit unions.
- Evaluate which would be the better choice for them based on a set of criteria.
Venn Diagram: This handout should be filled out by students as they complete the lesson.
Americas Local Credit Unions, America's Credit Unions: Where people are worth more than money : Locate local credit unions and general credit union information.
Overview of Credit Unions: This page provides thorough information to help students understand what exactly credit unions are.
How Banks Work: This site is very helpful when explaining to students what banks are and how they work.
Credit Union: This EconEdLink page provides a thorough definition of Credit Unions.
Banks: This EconEdLink page provides a thorough definition of Banks.
Local Banks: This MapQuest Maps page allows you to type in banks and your zip code to locate the nearest banks to your school.
Credit Union Locator: This page allows students to locate credit unions local to their homes.
Bank Criteria Worksheet: Criteria for choosing a bank or credit union.
Interactive Activity: This EconEdLink activity helps students to understand the difference between banks and credit unions.
Activity 1: Similarities & Differences – What are these things?
Students will complete this Venn Diagram using the information they find on the following web sites:
Students should first find general information about https://www.mycreditunion.gov/ .
Students can also visit an https://www.thebalance.com/credit-unions-4073272 .
Have students find out https://money.howstuffworks.com/personal-finance/banking/bank1.htm .
Here is a thorough definition of https://econedlink.org/glossary/?glossary=C.
Students can also look at the definition of https://econedlink.org/glossary/?glossary=B.
Venn Diagram will be printed when it's completed and used as a reference sheet for the student until the end of the project, when it will be turned in.
Activity 2: Where are they?
Students will locate banks and credit unions that are close to where they live and go to school – which ones would be most convenient for them? Students locate one bank and one credit union in their area with web sites and fill this information in to the Criteria for Choosing a Bank or Credit Union worksheet.
- Locate Local Banks (Enter "banks" in the place for name and enter your zip code)
- https://www.mycreditunion.gov/about-credit-unions/credit-union-locator ; General Credit Union Information
Activity 3: Which one is better for me? Have students complete Bank Criteria Worksheet by using their venn diagram and Web sites they have researched.
Banks and credit unions have become fundamentally the same thing. The differences are due to credit unions’ history as grass-roots cooperative groups, while banks have always been for-profit institutions.
Split the students into small groups and have them discuss the tax status of banks and credit unions. Is the situation fair? Who does it benefit? Who does it hurt? Have the groups collaborate for a few minutes, then elect on member per group to share their thought with the class.
Give students the option to interview an employee of a bank or credit union and share their findings with the class. Require that they submit at least five questions for teacher approval before they conduct the interview.
Have students use their venn diagrams and information they learned to complete the activity below.
Have students complete an Interactive Activity.