The phrase is informal, fitting casual conversations more than formal settings. I might take a year off before college to travel, so I'm keeping my options open.
Pro Tip 2/3
Non-Committal
Using the phrase suggests you're not ready to commit and prefer flexibility. I'm keeping my options open about moving; I haven't decided the city yet.
Pro Tip 3/3
Future Decisions
It implies that a decision will be made in the future, just not now. He's keeping his options open and will choose his major after some college courses.