Lending Club Blog

Strategies for Building up Your Savings

People use many different methods to save. Some use automated savings plans or recurring transfers from their checking accounts to their savings accounts. Others pay themselves first by having their paychecks go into savings and then taking out only what they need. Still others keep a coin jar lying around to help them store their loose change. An example of this latter method is the Keep the Change program available to Bank of America customers.

The way Keep the Change works is that debit card purchases are rounded to the nearest dollar. The purchase still costs the same and the extra money gets transferred from your checking to your savings account. So buying a coffee for $1.79 would result in a $1.79 charge and a $0.21 transfer from checking to savings for a total transaction of $2.00.

The idea builds on the concept that these small amounts are rarely missed and add up over time. As an added incentive, Bank of America will match your transactions for the first three months, up to $250. After that, the bank gives you 5% of your transactions as a bonus for using the program.

When you consider that the average debit transaction is going to transfer fifty cents, you realize that to get the $250 bonus, you’d have to make around 500 debit transactions in the first three months. Keeping up that pace, which would take considerable effort, would only yield about $50 (from the 5% bonus) over the course of a year. While the initial matching is rather large, the subsequent bonus hardly seems worth the effort. For a much easier way to earn a 5% bonus, see the special lender program Lending Club currently has running for people who lend at least $5,000 in their P2P loan portfolios by February 3rd, 2008.

Using your debit card for the Keep the Change program is good in that you are not subject to interest rates as you would be with credit cards. There are issues with using debit cards, however. Overdraft fees and blocking are common complaints and liability for debit cards may be higher than for credit cards.

Are there better ways to save? For most people, yes there are. As I said in the opening, though, different people save in different ways. For people who regularly use their debit card and have trouble with saving methods that require more discipline, Keep the Change may be a viable savings option. Whatever method you choose, consider putting some of your savings to work through social lending on Lending Club, where you will earn better returns while helping others.

Thursday, January 10th, 2008 at 7:40 am

Comments (1)

  1. […] Original post by Lending Club | Better Rates. Together. […]

    January 10th, 2008 at 11:45 am


Types of Loans 101

Growing Your Business By Using Capital

9 Reasons to Open an IRA

6 Reasons to Get a Personal Loan

See more
Lending Club Awards
  • Archives z

Recent Posts

Lending Club Teams Up with United MileagePlus® to Offer Customers More

  When it comes to… Read More »
October 21, 2016

Patrick Dunne: A Message to Investors

I wanted to take a moment to introduce myself… Read More »
September 29, 2016

Line of Credit vs. Loan

Lines of credit (LOCs) and small business term loans… Read More »
September 28, 2016

Types of Loans 101

There are many types of loans out there and… Read More »
September 16, 2016

Meet Patrick Dunne — Lending Club’s Chief Capital Officer

Patrick Dunne, Chief Capital Officer,… Read More »
September 8, 2016

Growing Your Business By Using Capital

Smart small business owners don’t wait to consider borrowing… Read More »
August 19, 2016

9 Reasons to Open an IRA

Retirement: a word that often comes with many connotations.… Read More »
August 5, 2016

6 Reasons to Get a Personal Loan

While it would be great if we all had enough… Read More »
July 29, 2016

Lending Club and the Marketplace Model

Some of our investors have observed the funding environment… Read More »
July 28, 2016

A Recap: Credit Strength on the Lending Club Platform

We are proud of our… Read More »
July 14, 2016


We went public today!

Ringing the bell this morning at the New York… Read More »
December 11, 2014

New and Improved Statistics Page

We recently redesigned our Loan Statistics page to make… Read More »
November 13, 2014

Lending Club Honored with Economist Innovation Award

This month I was honored… Read More »
October 15, 2014

Welcome Vermont Investors!

Today, we’re thrilled to welcome residents of the state… Read More »
September 4, 2014

We filed to go public today

We filed a registration statement with the SEC today… Read More »
August 27, 2014

Our Billion Dollar Quarter

We’re excited to announce  that we’ve facilitated over $5… Read More »
July 8, 2014

Is Lending Club Available in My State?

Is Lending Club available in my state? That is… Read More »
July 7, 2014

Lending Club Joins Senator Cory Booker to Discuss Improving Access to Capital for Small Businesses

Read More »
June 20, 2014

Lending Club Named a CNBC Top 50 Disruptor for a Second Year

For the second year in… Read More »
June 17, 2014

PRIME is now Automated Investing

Lending Club is excited to announce that PRIME has… Read More »
May 14, 2014
View All w