Keep the Change

I recently opened an account with Bank of America. They have wonderful promotions enticing you open a checking and savings accounts and they will GIVE you $25!!! If you're in the category of saving and not spending down you're balance then you could get up to $100!!

They also have a program called Keep the Change. For those who haven't heard of this it's when you use your debit card. For example, you spend $27.74 and Bank of American will take $.26 from your checking and put it in your savings account. So when you reconcile your checking account, you will see that $28.00 was actually what was spent. I like this feature. It's a great way to keep you saving money. After all, we are in a recession right? Saving is at its all time high! I read an article that said that the next generation, i.e. my lovely daughter, will be very savvy with money. Oh the days of frivolous spending will be gone. But who really can predict the future?

Now, the important thing here. Bank of America will MATCH your Keep the Change total! So if you didn't do the math, you will have $.52 put in your savings! How nice of Bank of America! Oh how things are blurry to the average person. I am included. I checked my savings account and didn't see the match from BOA. I know the answer now!

You won't receive your match until you've had your account valid for 2 months. When you get this match, you will also be issued a 1099 for income earned! What does this mean? A 1099 is a miscellaneous income tax document, similar to your W-2, that is reported to the IRS. You aren't getting any freebies from BOA. In fact, you know that cool $25 you are going to get for just opening a checking and savings account? It too will be reported to the IRS.

Just thought I would share this with you all. In some cases, this won't be a problem for most people. However, if you are trying to keep your income below the next tax bracket, or keep a grant or scholarship, keep this in mind.