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State Employees’ Credit Union Review: Checking and Savings

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State Employees’ Credit Union
NerdWallet’s rating: 3.5 / 5.0

3.5 stars out of 5

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If you live in North Carolina, State Employees’ Credit Union is hard to miss. SECU branches are about as common as Starbucks outlets across the Tar Heel State, and that’s saying a lot.

The bottom line

  • SECU offers more 250 branches and 1,100 network ATMs in North Carolina, making it one of the largest credit unions in the U.S., but it has no presence outside the state.
  • The credit union has a forgiving overdraft policy.
  • SECU’s share certificates — the credit union equivalent of certificates of deposit — get a high NerdWallet rating, 4.5 stars out of a possible 5.

» MORE: NerdWallet’s best savings accounts

Our Ratings
Checking accounts3.5 stars out of 5
Savings4.0 stars out of 5
Share certificates4.5 stars out of 5
Customer experience3.0 stars out of 5
Overdraft fees4.0 stars out of 5
Overall3.5 stars out of 5

Read on for more details about State Employees’ Credit Union’s checking and savings accounts, share certificates, customer experience and overdraft fees.

Checking

3.5 stars out of 5
3.5 / 5.0

SECU offers a basic checking account that earns a 0.25% annual percentage yield, or APY, on all balances. That’s more than what many traditional banks and even some online banks offer.

The account also has a mandatory $1 monthly service charge. That may not seem like much more than an annoyance, but there are other credit unions and banks with checking accounts that don’t have any monthly fees.

SECU members can direct the mandatory fee to go to the SECU Foundation, a nonprofit that supports local communities. But the payment is not tax-deductible.

ProsCons
  • Earns APY.

  • No minimum deposit required to open account, but your initial deposit must cover the cost of the first $1 monthly fee and any checks you order.
  • Charges a mandatory $1 monthly service fee.

  • Charges 75 cents for out-of-network ATM transactions and 35 cents for out-of-network transactions that are denied. The fees are relatively low, but some institutions don’t charge out-of-network ATM fees.

» MORE: NerdWallet’s best checking accounts

Savings

4.0 stars out of 5
4.0 / 5.0

A savings account — often called a share account at a credit union — is required for SECU membership. It has a low $25 minimum-deposit requirement and an attractive 0.75% APY.

The SECU share account can be a good place to park your cash, as long as you keep at least $25 in the account. If the balance falls below that amount, there’s a $1 monthly fee.

SECU also offers a basic money market account that earns an APY of 1.01% in return for a higher minimum deposit.

ProsCons
  • Earns APY on its share (savings) account. Many large banks offer rates as low as 0.01%.

  • Earns a relatively high 1.01% APY on its money market account.

  • Offers a share account with a minimum opening deposit of just $25 and a money market account with a relatively low minimum of $250.
  • Charges a $1 monthly fee on its share (savings) account if your minimum balance is below $25 on the statement date.

  • Charges a $2 monthly fee on its money market account if your minimum balance goes below $250.

Share certificates

4.5 stars out of 5
4.5 / 5.0

SECU offers a variety of share term certificates, the credit union equivalent of certificates of deposit. The certificate terms range from six months to five years, and earn better rates than at many other banks and credit unions.

ProsCons
  • Offers above-average rates for share term certificates, from a 1.00% APY for a six-month certificate to a 1.75% APY for a five-year certificate.

  • By comparison, Bank of America, which also is based in North Carolina, offers CDs with low APYs of 0.03% to 0.15%.

  • Requires a relatively low minimum deposit of only $250.

  • For longer-term certificates, you can get slightly better rates at other credit unions. For example, Navy Federal Credit Union offers a five-year certificate with an APY of 1.80% to 1.90%, though it requires a higher minimum deposit.

Customer experience

3.0 stars out of 5
3.0 / 5.0

Though SECU has hundreds of ATMs in North Carolina, it isn’t a member of a cooperative network of ATMs, so you could face ATM fees when traveling out of state. But the high number of branches and ATMs is helpful if you live and do business in North Carolina.

SECU also doesn’t provide a mobile banking app for smartphones and tablets, though it does offer a mobile version of its webpage. And its call center is staffed 24 hours a day, seven days a week.

The credit union claims membership of about 20% of North Carolina’s 10 million residents. But it’s not easy to join SECU if you don’t work for the government. You generally have to be a public employee in North Carolina, or be related to one, to be eligible. You can’t qualify by living, working or worshipping in a certain geographic area, as you can with some other credit unions.

Overdraft fees

4.0 stars out of 5
4.0 / 5.0

SECU outshines many other institutions when it comes to low fees, especially for overdrafts. The credit union waives nonsufficient funds fees for the first two days per year when items are returned for not having a sufficient balance in the account. So you won’t pay a penalty for an occasional overspending mistake.

If a transaction is rejected because of nonsufficient funds after the two fee-free days, the credit union charges $12 per item. That’s not cheap, but it’s well below the national median of $34 to $35.

And SECU offers a program called Another Chance to alert members of pending NSF transactions. The program gives members until 5:30 p.m. that day to make a checking deposit to cover the shortfall and avoid having an item returned.

You can also choose to link another SECU savings or credit account to your checking account for overdraft transfers, and the credit union will only charge 50 cents per transfer, whereas some large traditional banks charge $10. Even better, SECU waives those transfer fees for the first two days per year that they occur.

You still need to be careful about overspending on a SECU account. Some banks charge a maximum of five NSF fees daily, even if a customer has more than five instances of nonsufficient funds on a given day. But that’s not the case at SECU. After you’ve used up your waived-fee days,  there’s no daily limit on those fees charged by the credit union.

Doing business locally

State+Employees+Credit+Union
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at State Employees' CU
For those who don’t qualify for SECU membership, we can recommend great credit unions with similar products. But if you live in North Carolina and want to do business with a local financial institution that’s active in the community, SECU might be a good choice for you.

Margarette Burnette is a staff writer at NerdWallet, a personal finance website. Email: mburnette@nerdwallet.com. Twitter: @margarette. NerdWallet writer Devan Goldstein contributed to this article.

Updated Oct. 7, 2016.


Ratings methodology

NerdWallet’s overall rating is a weighted average of each category: checking, savings, CDs, customer experience and overdraft fees. Factors we consider, depending on the category, include rates and fees, ATM and branch access, account features and limits, user-facing tech and customer service. Several Nerds contribute to each financial institution’s ratings to ensure consistency and accuracy.

What the ratings mean:
5 stars out of 5 — Among the very best
4.5 stars out of 5 — Very good; only minor caveats for most customers
4 stars out of 5 — Good; issues that might make a difference to some customers
3.5 stars out of 5 — Fair; make sure strengths and weaknesses are a good match for you
3 stars out of 5 — Poor; proceed with great caution
2.5 stars out of 5 (or below) — Best to avoid