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In the early 1960s, when Anita Kennedy was just six years old, she opened a savings account at Bank of America as part of a school program that encouraged children to save.
She stayed with the bank for more than 60 years, but last month, exhausted by predatory fees, terrible customer service and incessant branch closures, she moved all of her accounts to a local credit union.
“I don’t regret it at all,” he said. “It’s nicer: a human being answers the phone, not a computer, and seems genuinely willing to help solve problems.”
Kennedy’s pitiful depiction of banking is a far cry from her wholesome portrayal in the 1946 classic ‘It’s A Wonderful Life,’ released just a decade before she was born.
The 1946 film ‘It’s a Wonderful Life’ reveals the value of community-led banking. The photo shows an exchange of cash between protagonist George Bailey, played by James Stewart, and Mary Hatch Bailey, played by Donna Reed.
Membership of federally insured credit unions has steadily increased by nearly 5 million annually for the past six years.
In it, protagonist George Bailey plays an altruistic banker in the fictional town of Bedford Falls. His institution, ‘Bailey Building and Loan’, serves as an example of how generous banking can empower a local community.
“It’s the lack of customer service and the increasing service fees for every little thing that has ultimately turned me away from the big banks,” Kennedy said.
She is not alone. At the end of last year, the total number of federally insured credit union members reached an all-time high of 139.3 million, according to data from the National Credit Union Association (NCUA).
Last year, membership grew nearly 3 percent, about six times the growth of the U.S. population, according to Mike Schenk, chief economist at the credit union advocacy group America’s Credit Unions.
“Overall, it’s a reflection of the fact that people now understand that credit unions are different than for-profit institutions,” he said. “The savings are really big and people know about it and tell their friends.”
Throughout his life, Kennedy and his wife have had other bank accounts at traditional banks such as Chase, Wells Fargo, Citibank and Bank of the West.
“At first, they offer free checks, then somehow that morphs into free checks if you have a certain minimum amount in your bank account, then that morphs into free checks if you have direct deposit,” he said.
As a resident of Alameda County, Kennedy was able to open an account at 1st United Credit Union, which has about ten branches in the San Francisco area. Offers basic checking accounts with no monthly fees.
Tired of predatory fees and branch closures, Anita Kennedy (left), 69, closed her Bank of America accounts last month after more than 60 years. Christopher Kent (right), 57, was fed up with the low interest rates Bank of America was paying him on his savings, so he opened an account at MidFlorida Credit Union.
As a resident of Alameda County in California, Kennedy and his wife were able to join 1st United Credit Union, which has ten branches in San Francisco.
Christopher Kent, 57, originally from New Jersey, has had similar experiences. For more than 20 years he maintained various accounts at Bank of America.
While inflation was under control, he tolerated the negligible interest he earned on his $200,000 in savings, but when rates started rising after the pandemic, he knew he had to act.
‘Bank of America was earning more on its reserves. You’d think they’d pass it on, but they just kept that money, which leaves a bad taste in your mouth,” he said.
While waiting at a traffic light in Largo, Florida, he noticed a new MidFlorida Credit Union branch being built.
When it opened earlier this year, he walked in and met with an employee. Shortly afterward she transferred his money to a new account that earns interest at 3 percent per year.
“It gave me all the liquidity I needed and I was able to earn something with my savings,” he said.
The big banks have become sterile
Big banks have become increasingly sterile and impersonal, Kent says, but his new credit union is a breath of fresh air.
“They’re a great organization, very nice and friendly,” he said of MidFlorida, which is Florida’s fourth-largest credit union with nearly $7 billion in assets under management.
‘When you walk in, everyone says “hello,” whereas at Bank of America I don’t really think they care much. You are just a number, there is no warmth.
First, Kent didn’t even open an account at Bank of America; Instead, an old account she opened at United Jersey Bank around 1990 was converted when the small bank was acquired.
Kent stopped at a light when he saw the MidFlorida Credit Union in the East Bay under construction. When it opened, she went in and opened a savings account.
“I actually really wanted to deal with a bigger bank, I thought it would give me more opportunities, but in the end you get lost in the shuffle,” he said.
“At a small community bank, if you have a problem, you go, sit down and talk to someone, they know who you are and you build a reputation and a history with them.”
Kennedy also felt hopeless about her inability to interact meaningfully with bank staff and having to talk to “robots” every time she asked for help.
‘I find it really frustrating and really demoralizing. “Banks should do more to help their customers, not less,” he said.
Bank branches continue to close
Driving the exodus of Americans from banks to credit unions is the dwindling number of bank branches, where customers can meet employees face-to-face.
For Kennedy, who lives in Napa, California, the recent closure of Citibank meant it would take him an hour to get to his nearest branch.
“With the price of gas, it becomes expensive,” he said.
And for Kent, the fatal blow to his relationship with Bank of America was that his local branch claimed they would no longer allow him to open a safe deposit box even though they admitted to having some for free.
“That seemed like a warning sign that they were going to close my branch in the future,” he said.
He also noted that not only are credit union branches in his area still open and nearby, but MidFlorida branches are clean and often open on Saturdays.
Americans are tied to big banks
While Kent and Kennedy eventually managed to open credit union accounts, there were barriers to doing so.
Changing banks is not an easy task. Not only does it take time to find the right place to open another account, but changing payments from an employer or Social Security direct deposits can be a hassle.
For example, the IRS may already deposit refunds into an existing account, or one home insurance provider may receive payments from another.
Kent described how he had been “drawn” to keep his Bank of America account open because of the extra cash back he was able to get on his credit card.
Bank of America’s flagship savings account still yields just 0.01 percent annually
“If I kept more than $100,000 on deposit, they would give me an additional 0.75 percent cash back, but since I only spent $2,000 a month, that’s only an extra $15 a month,” Kent said.
That’s about $180 a year. Instead, by keeping your money in the MidFlorida Credit Union Savings Account, you can earn $3,000 a year on $100,000.
‘That’s a big difference. That means $2,800 a year is left on the table,” he stated.
Bank of America’s flagship savings account still yields just 0.01 percent APR.
DailyMail.com invited Bank of America to comment on its low rates, automated phone systems and branch closures, but received no response.