How to make money with Time Deposits.

Time deposits can be a good source of income as long as you have enough capital and play it smart.
It's called a CD because once you buy a time deposit you will get a Certificate Deposit.
Here are details on how it works;


"The minimum term for time deposit is usually 30 days; maximum is up to five years. The longer the term, the higher the interest would be on your CD (Certificate Deposit). 

So what you do is you sign-up for a time deposit. Wait for it to mature then earn from interest.

 In the event that you to withdraw your money early, there are penalties imposed. Once the maturity is reached, you can withdraw your deposit without penalty. This time the money will be deposited back to your regular savings account. That is why it is a bank requirement that before you open a time deposit account, you should first have a savings account with them (your bank). If you want to use your money at the end of the term, be sure to withdraw it on a specified date of term, or else your money will be rolled-over into another CD for the same length of time.

For funds like emergency fund, time deposit is a good option to put your money. It is  a good idea to sign for a 30-day maturity only. With that, you can withdraw the fund monthly and re-deposit it together with your additional deposit, thereby avoiding penalty and let your deposit earn a higher interest"

Source: The Seed Money- Christopher Cervantes, RFP





CD's  are covered by the Philippine Deposit Insurance Corporation. So it's virtually risk free.



Rural banks have higher CD's


Bank of Makati
5k to less than 50k -- 1.125%
50k to less than 100k -- 1.25%
500k and higher -- 2%
2% to 2.5% for terms of from 1 year to less than 5 years

Smart Bank
100k to less than 250k -- 5%
250k to less than 500k -- 6%
500k and higher -- 6.5%



BANCO SAN JUAN
Minimum time deposit of 5k
Free cellphone for minimum time deposit of 50k
Time deposits can be used as loan collateral


Notes for all banks:

- Higher interest rates for longer terms
- 20% withholding tax for time deposits with term of less than 5 years
- No withholding tax for time deposits with term of 5 years
- Insured by the bank with the PDIC for up to 500k per depositor


THANK YOU FOR READING!