Behind the Times - I learn about Keep the Change
I tend to ignore most promotions that banks send my way. I use Bank of America for my primary checking account, and they often interrupt my online banking log-in to try to sell me on some kind of promotion, and it’s usually crap.
So it was with Keep the Change — I just assumed that it was another little gimmick that wasn’t worth a second glance, and I would sigh heavily whenever the advertisement prevented me from immediately seeing my account balance when I logged into my online checking account. It wasn’t until a friend told me that she was participating that I started to pay attention.
(Now, to show you just how out of it I am, Keep the Change launched in October 2005, and I’m blogging about it in January 2007. The fact that I know what a "blog" is should probably be surprising. Aren't you glad that I get paid fractions of pennies per day to give you financial advice?)
Bank of America's Keep the Change program works like an electronic version of a change jar. You know how you hear that when you pay cash for something, if you ALWAYS put your leftover change in a jar, at the end of a year, you’ll have several hundred dollars saved up? That’s true if you are the cash-paying type — I’m not, although that may change over time. I tend to use my debit card for everything. And this is where Keep the Change comes in.
Keep the Change pretty much works like a change jar. Every time you pay for something with your B of A debit card, Bank of America will round the total up to the next dollar (no matter what the amount) and deposit the difference in your savings account. So, if your morning latte comes to $3.13, an extra $0.87 is taken from your checking and deposited into your savings account.
So, initially, they take extra money out of your checking account and deposit it into savings. This isn’t really revolutionary, but it’s not a bad idea. If you’re already a Bank of America customer, and you tend to ignore most promotional offers from your bank, then you should consider it.
- It makes balancing your checkbook a lot easier. Whole numbers = simple accounting.
- You save money automatically, without thinking about it.
- Earn as much as you can by tipping. When I go out to eat (every night), I add my tip so that my total comes to exactly one cent over a whole dollar amount — $29.01, for example. That way, Bank of America will save $0.99 for me.
- It appears as though you can go ahead and transfer the money out of savings (although this sort of defeats the purpose of saving the money, and you won’t earn as much interest as if you left it there, but in a pinch, you can grab those funds).
- If you overdraw your account for a day, Bank of America will not round up to the nearest dollar amount and the Keep the Change transfer will be cancelled.
- I don’t think it’s really worth it to open a checking and savings account with Bank of America if you don’t already have one. You don’t get great interest rates on savings, and other banks are more than happy to give you better promotional deals.
- You only make a good deal of money on this if you spend like I do, on tons of little items, many times a day. I do this, but I’m trying hard not to, and trying not to makes it difficult to earn as much money from Bank of America.
I've been enrolled in Keep the Change for a little over a month, and I've set aside a little over $70. Hey, it's not a lot, but it's a manicure and pedicure, right there.
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