PerkStreet debit card a good alternative to credit

card swiping through credit card reader

If you've discovered that you can't manage credit responsibly, or you want to avoid the temptation of credit altogether, you have to pay for all your purchases in cash, by check or by debit card.

Using one of these payment methods means you're missing out on credit card rewards.

With PerkStreet Financial’s debit card rewards program, you don't have to choose between earning rewards and staying out of credit card debt.

But this card isn't just for the debt conscious. Since it's backed by an FDIC-insured bank account, PerkStreet can serve as your checking account, too. (Just remember, debit cards offer less fraud protection than credit cards.)

You can earn up to 1% back on everyday purchases and up to 2% back on online purchases. You can redeem your rebates for cash or get slightly higher benefits by redeeming them for gift cards.

Here’s how it works (www.perkstreet.com):

* Every time you make a non-PIN purchase, you’ll earn 1% back.

* When your checking account balance is $5,000 or more, you’ll earn 2% back on in-store purchases at Walmart, Best Buy, Target and the Apple store on your first $2,500 in annual spending (for a maximum of $50 back per year).

* The same guidelines apply to online purchases at the same stores, but you don’t need a $5,000 balance to earn the 2% back.

Primary PerkStreet fees

Fee Charge
Overdraft $32
Inactivity $4.50
Non-network ATM $2

* You’ll also earn 2% back at restaurants, bars and coffee shops when you and a friend each use your PerkStreet cards to pay.

* Rotating PowerPerks lets you earn up to 25% back at specified merchants with no spending limit.

As with many credit card rewards programs, you’ll maximize your rewards by redeeming your percentage rebates, which PerkStreet calls "perks," for gift cards with merchants like Amazon, Target, Walmart and Starbucks — options that are as good as cash for many consumers.

You can redeem 20 perks for a $20 Amazon gift card, for example. If you want to redeem your perks for a statement credit, you’ll have to use an extra 2 perks (22 perks will get you a $20 statement credit).

The PerkStreet card is backed by an online bank that has its own set of benefits, including free checking, free online bill pay and free access to ATMs located in grocery stores, gas stations and other retail outlets. The banking services are provided by the Bancorp Bank, headquartered in Wilmington, Del.

The PerkStreet card does have a few drawbacks:

* Only ATMs that are part of the STAR Network are free. There are 250,000 of these ATMs in the United States. PerkStreet charges a $2 fee for non-network ATM transactions.

* PerkStreet does not offer savings accounts, so you won't get the convenience of having your checking and savings accounts in the same place.

* There is a monthly inactivity fee of $4.50 if you don't use your account at all. (If you actually use PerkStreet for your primary checking account, you're unlikely to incur this fee.)

* You must mail in checks for deposit (there is no way to upload them online or with your smartphone). However, you can mail them via USPS for free or overnight them for free from a UPS store.

* Perks expire 36 months after they’re issued.