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Excerpt from mailing list discussion on 12/14/2017

There are no ATM fees at any credit union in Maine, and there are no monthly fees on the accounts, except the $25 to “join” the credit union. This fee is returned when you close your account. It shows up on your savings balance, but there is also an “available balance” which excludes the $25. There are still fees for overdrafts, of course, but they tend to be less than regular banks.

Some credit unions offer free overdraft protection (meaning they will move money from your savings to your checking) and I also have essentially a standing pre-approved loan on my account so I can use up to $1500 by just an on-line transfer. The balance of the “loan” then requires at least a minimum monthly payment, but the interest is much lower than a credit card, and is calculated by the day, so you can pay extra or pay it off whenever you want. I use this as a bridge for larger or unexpected expenses – new glasses, car repairs, etc.

I suggest you go in with your mentee to talk to someone at the CU/bank and learn whether they have these programs. You can also ask about how to build credit. Once you are a CU member, it is generally easier to get lower interest loans as well, looking ahead to buying a car or eventually having a mortgage.

Depending on how familiar your mentee is with the US banking system, you may also want to discuss how to write checks, use a debit card, use online banking, and especially how to track what money is left in the account when checks and debits haven’t posted yet, etc. When you are just scraping by, incurring an overdraft charge is devastating, and should be avoided at all costs.

It is also a good opportunity to discuss credit cards and provide some examples of how much interest you will pay on various balances. When I was teaching English classes in Lewiston, I discovered most of my students had no idea about this stuff.