Perhaps the most shocking part of PerkStreet closing is the fact that it will not honor perks that customers have already earned, some which have been saved for years by frugal plan-ahead bankers.
That means if you had hundreds of dollars in perks saved up for Christmas, a rainy day, or a vacation, you lost all that money.
Some were very generous, and said perks were perks and bankers of Perkstreet did not “earn” the money. Other knew it was Perkstreet’s form of interest, and they had earned it as surely as if they would have put the money in the bank and earned interest. The difference here was that Perkstreet had fine print that did not require them to honor the “interest earned.” Most investors had never seen this fine print and did not know of its existence. If they had known one day sooner they could have cashed in their perks. Perks earned on money they could have invested for legit interest somewhere else. Perks they were saving for Christmas presents and hoped-for vacations.
That’s just not right.
I went about transferring my money back to my main personal bank account and closing the account.
Once all transfers were made I moved all my “perkstreet” envelopes from my personal budgeting software (mvelopes.com), back to their normal and rightful parent envelopes (e.g., fuel to Auto:, hair to personal:). I had previously moved them under the parent envelope Perkstreet to keep track of the amount of money I needed to keep on the Perkstreet debit card in order to use it for those envelopes. It was relief to have things in their logical groups again, and I allocated transactions much more quickly.
I thought a lot about points, and perks, and plastic versus cash.
You see, Nate and I are Dave Ramsey hard-core fans. We were delivered from a mess of lies when we first took the class in the summer of 2010. Without getting into the whole wisdom of how the class helps you learn to manage your finances, one of the single classic methods you learn is the old fashioned envelope method.
Yes, aside from your online bill pay and things like fuel, we literally began carrying cash around in envelopes. It probably cut our spending in half. At any rate, we felt like we got a raise.
We cut up or froze all of our credit cards.
We told our money where to go and stopped being surprised at monthly credit card bills. There were no monthly credit card bills anymore. Once we got that one payed off (a joyous moment), we were done with credit cards completely. It was so satisfying to know that when we spent money, it had already been earned, already allocated, already planned, and already put into an envelope for that purpose. It was an amazing feeling.
Then we heard about perkstreet – a place where you could get points for dollars spent even though you only used a debit card (not a credit card). We signed up – it was good to get points again (called perks)!
We also applied the points back to our Target purchases. You can get a Target debit card (again, not a credit card), that is linked to your bank account that rewards you a whopping 5% for every purchase. That sounded like money saved to us.
But things were never the same after that. Target purchases were made on one card and other purchases on perkstreet. Instead of cash envelopes we went back to virtual banking, which meant that sometimes we overspent our envelopes and ALWAYS had to sit down after a week of shopping and allocate all those miserable rows of transactions. It caused tension to rise and we argued over who spent what again. It was a far cry from credit card days but not as peaceful as our cash days.
So when Perkstreet announced that it was closing, and that they would not be honoring perks, I thought about the perks we lost. It was the ONLY reason we banked with Perkstreet, yet we lost some of the perks to which we were looking forward. It wasn’t nearly as much as some, but it still changed the game for me.
Given the hassle, the lack of assurance, the lack of peace, the moving money back and forth and carrying all that plastic, was it worth it?
Who cares about 1.5% cashback from Perkstreet when there’s a chance that it will all be jerked away from you anyway?
Who cares about 5% cashback from Target when we still probably lost a bit of control over our own spending habits to get it?
With relief, I moved the funds. With relief we regrouped my envelopes to their old familiar envelopes. We withdrew a relatively large amount of cash (relative to what we had been carrying), and divided it among food, personal spending, blow and my beauty budget (oh so important!). Nate, my husband, carried most of the cash (food and his blow) and I carried my blow and my beauty budget. It’s not a lot of money. Nobody would want to mug us or anything I would hope, but it’s what we need to get us through the allotted amount of time.
Again, we felt like we got a raise.
Money in the bank stayed in the bank. It hurt to spend cash so sometimes, we didn’t. And since we are at the beginning of a large project in our small business, the heavier cash flow will come later and we had to count every dollar.
The lack of plastic, the cash envelopes – they really helped us to do just that.
On more than one occasion, while deciding if I should buy some small item, I thought, “I’d rather have the $10 in my purse.”
We were very surprised at how slowly money went down in our account. Our small business account and our personal account had enough.
And like in all times when we’re afraid we won’t have enough – we trust God. It’s what worked when we started the journey, and it’s how we’ve come to live. Through trust – not in a credit card, a points back system, a bank or even the cash in our wallets (there’s not much of that), but in God.
Reminiscent of our first weeks on the Dave Ramsey budget plan back in June of 2010, miracles happened. We got money in the mail. A refund for a medical bill we payed 6 months before (who refunds medical bills). Our second car, which I had just been thinking we didn’t need, didn’t pass inspection so we sold it instead. The cash was better than the car. Other small things happened so the cash in my husband’s wallet stayed more than equal to our needs.
Cash back, points, perks, rewards, whatever you call them. I just don’t think I’m ever going to believe again that they bring you as much cash back as they cost you.
If you’re looking for some envelopes, here are some cute ones.