Keep the Change?

Bank of America--the bank at which I have my account(s) for reasons passing understanding*--has this program called "Keep the Change," which is pitched at me every time I spend the 20 minutes required to to get money out of their lethargic ATMs. I have never been able to understand why anyone would think it was a good idea. And it seems that I am not the only one. Over at Marginal Revolution, economist Alex Tabarrok writes:

The Bank of America's Keep the Change program freaks me out. Every time you make a charge with your B of A debit card it rounds the figure up to the nearest whole amount and transfers the change to your checking account. Commercials for this service are all over the television and radio - tagline: "you don't even have to think about saving" - and every time I see one I feel the gulf between me and the rest of humanity widening (MR readers excepted of course).

Look, I can understand Ulysses tying himself to the mast, I can understand locking the refrigerator and I can understand Christmas accounts but I will never understand how anyone can increase their savings by taking money from one account and putting it into another. I think I will write a book, I will call it Mental Accounting for Dummies:

The secret to saving more money is simple. In your right hand is money for spending. In your left hand is money for savings. Now take some money from your right hand and put it into your left hand. Tada! Wasn't that easy?

Consumer Reports also had a pretty thorough debunking of the program some time ago, as well.

It wouldn't work for me anyway because I adamantly refuse to use a debit card.


*Actually, I remain there because after seven years the managers and tellers all know me, which makes the rare special request so much easier to ask for and be granted.