Financial Literacy Month Dos and Don’ts from PerkStreet

by News Guy on April 23, 2010

April is Financial Literacy Month, and Dan O’Malley, CEO of PerkStreet Financial, a progressive online bank that offers the best checking account rewards in the US, has compiled a list of financial tips every consumer should know.

Dan’s Financial Literacy Month Dos and Don’ts:

  • DON’T use a credit card – it can actually cause you to spend more money! The average person spends 17% more using a credit card than with debit or cash.
  • DO set up automatic text or e-mail alerts to keep you aware of your spending. Many banks offer some kind of alert functionality. PerkStreet allows you to enable text or e-mail alerts to let you know if your balance goes above or below a certain level-a simple step that can prevent overdrafts.
  • DON’T forget that ATM fee rebates you get from your bank are taxable. Consumers need to take this into account as they weigh the benefits of various checking accounts.
  • DO make a budget. Creating a budget can seem overwhelming, but free online tools like Mint make the process simple and fast, and even a quick, informal budget can help you become more aware of how you spend your money, so you can adjust where necessary.
  • DON’T assume that high-interest checking accounts are the best bang for your buck. They sound great, but most consumers don’t keep nearly enough money in their checking account to make the yields worthwhile. When it comes to checking accounts, it usually makes more sense to get rewards based on what you spend, not what you save.
  • DO use a free Web site like BillShrink for side-by-side comparisons of utility prices. It’s faster than finding all the prices yourself, and you just might discover a better deal!
  • DO think about how your bank is spending your money. Traditional banks spend $85 billion annually on maintaining local branches-money that online banks can pass on to consumers in the form of lower fees and higher rewards.
  • DO watch out for the ways banks are adjusting their practices after the CARD Act. The new law includes some great consumer protections, but some banks are adding new fees or reducing rewards programs to make up for the lost income.
  • DO take it one step at a time. Managing your finances can be stressful, and like most things in life, it’s best done in manageable steps. Instead of trying to change all your habits at once, try one new thing at a time. Each healthy new habit will get you closer to having control over your finances.

About Dan & PerkStreet

Dan is a “mathophile” who co-founded Capital One’s Payments division and launched its prepaid business. He founded PerkStreet to bring consumers more of what they want from banks.¬† PerkStreet takes the money traditional banks spend on building and maintaining their branch networks and puts it to work for debit card users, with the most valuable debit card rewards program available.¬† Customers are rewarded for spending wisely with points that can be redeemed for cash back or fun treats like Starbucks coffee and iTunes music.

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