I’m always telling people that they don’t need a Credit card. I blabber on about it and if not stopped get to the point of ranting about how access to Credit will eventually tempt everyone. I believe even the most rigid of people can find themselves slipping into the debt trap, needing to pay a little back more month-on-month.
For the most part I think my rants make perfect sense. I am stead fast that for most people in their general daily lives Credit is not needed if people plan correctly and save properly. If you can’t afford something for one month you need to buckle down and spend less, not fall back on a credit card to keep your standard of living up (see I am falling into rant territory again!).
The one brick wall I keep coming up against on my crusade to stop people using Credit cards is the fact that with Credit cards, if used properly (or rather improperly from the CC companies POV) is that you can get a lot of rewards, cash back, air miles etc etc. These can add up to be essentially free money.
Now, finally, it seems that the world of decent cash back rewards has come to Debit with the checking account and MasterCard from Perkstreet Financial.
I’m not yet a Perkstreet customer but certainly will be if they ever open up in the UK where I have my accounts. I have spoken with some other bloggers who are customers and as far as I can tell they are operating a pretty decent account that has no major downsides when compared to other checking account options. Maybe the only thing I could see is you may come across somewhere that doesn’t take MasterCard but let’s be honest that is extremely rare. I’d love to hear from you if you have experienced any other negatives.
So, here are the details of what the checking account offers and also what rewards you can get.
The Checking Account
- Get everything you need from a checking account
- Easy-to-use online banking with free bill pay
- Free paper checks, free electronic money transfers
- 42,000+ free ATMs
- 24/7 round-the-clock customer service
- Free postage-paid deposit envelopes
- Deposits insured by the FDIC (up to $250,000)
Cash Back Perks
- The PerkStreet FinancialSM Platinum Debit MasterCard is your personal key to saving
- Earn unlimited 1% cash back almost anywhere you use your card*
- Earn 2% cash back at several popular retailers including Walmart and Amazon.com®*
- With PowerPerks, get up to 25% cash back on special offers from leading brands picked for you weekly
- Redeem at more than 35,000 leading retail and restaurant locations for free, or use 2 perks to redeem directly to your account.
- Get an extra bonus for paying with a PerkStreet friend
Their fee structure seems very reasonable too with no monthly fee but inactivity being only $4.50 per month (one transaction can stop this). They also charge $32 for going into an overdraft and bounced checks.
Perkstreet is obviously all online so what would probably be a good set up is to have a normal bricks and mortar checking account (maybe even with a local credit union). I would try and get one with a Visa debit. Then tie that into your Perkstreet account and move money over, for free, on a monthly basis. Obviously the best thing to do here would be to move an amount that amounts to your monthly budget and only use your Perkstreet card.
IMPORTANT: Perkstreet rewards are for non-PIN purchases
On my research about Perkstreet they keep saying that your cash back will only be given in stores when you have a non-PIN transaction. Just so you are not confused basically that means even though it is a Debit card you need the transaction to process as Credit, effectively making your cards a Pre-Paid Debit card.
Normally your retailer will ask if you want “Credit or Debit”. In this case just say Credit. If you are given the terminal and asked to enter your PIN then simply pressing cancel should allow it to go through as a Credit transaction which may require a signature like any Credit card.
Even though online purchases are not PIN transactions you will still earn 2% with certain retailers including Amazon, Itunes, Target, Walmart, Best-Buy and Apple.
It’s a small thing to remember in order to keep your rewards coming in!
How much will it earn you?
Let’s say you spend $600 a month using your Perkstreet MasterCard and $500 of that qualifies for 1% cash back and $100 qualifies for 2% cash back (I think that’s a fair rough estimate).
In a year you will have spent $6000 eligible for 1% back ($60) and $1200 eligible for 2% back ($24). That’s $84 over a year with fairly low spending expectations and without any of the bonuses that can earn 5%-25% cash back.
Other debit cards with rewards
Of course Perkstreet isn’t the only Debit card option when it comes to rewards (but it is arguably the best). So in fairness here is a quick look at the offering from Ally Bank.
Ally Perks – Ally Bank offer a perk scheme with their Interest Checking Account.. They say “Make qualifying purchases using your Ally Checking Debit Card, and we automatically put money back in your Ally account (for example, $10 back on a qualifying $100 purchase)”. Of course there are restrictions to the Perks and although it’s great because money is deposited directly into your bank account they are only available at certain retailers.
Debit reward programs used to be far more common but sadly in recent years bank after bank they have been killed off. However with companies like Perkstreet and even Ally bringing them back into fashion I sincerely hope it will bring a new wave of Debit reward accounts back to coax people away from the dangerous credit zone that I so much like to rant about!
Do you use Perkstreet or Ally? Do you have any questions, comments or general thoughts? Do you know of any other ways to gain rewards without using a credit card?
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