Keep the Change

I think this is brilliant. Kudos to Bank of America as they implement the new "Keep the Change" program.

The service dubbed "Keep the Change" allows customers to round up their debit card purchases to the nearest dollar and put the change into an interest-earning savings account.

For example, a debit card purchase of a sandwich and drink for $5.45 would be increased to $6, with the extra 55 cents going into the customer's savings account.

"Our customers have told us they're not saving the way they wish they were," Diane Morais, senior vice president of deposits and debit products, said Tuesday.

"We designed a very simple way to do it with what they do every day," she said. "It provides an easy way to save so they won't miss it."

To drum up interest in the "Keep the Change" program, the bank will match all contributions to the savings account for the first three months. After that, the bank will match 5 percent of the total. The matching funds would be credited annually.
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The bank has an annual cap of $250 for "Keep the Change" deposits. And the bank requires a minimum balance of $100 for a customer to obtain the service.

"It's very simple and that's the beauty of it," Morais said. "It's easy to understand and our customers get it immediately. And the response has been great."

While the savings rate in the United States was as high as 11 percent in the post-World War II era, it has plummeted to less than 2 percent in recent years.

Morais said the program is not aimed at any particular type of customer. "It has universal appeal," she said. "Everyone wants to save money for their children's education or for special purchases."