Time Deposit Guides

Time deposit guide

Time deposit guide

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If you have some savings in the bank which you want to grow, one of the safest ways to do so is by investing in time deposits, which are also known in other countries as term deposits and fixed deposits.

Time deposits allow you to lock away your money with the bank for an agreed amount of time and in return you will get fixed interest rate for the given time period, usually this rate is higher than regular savings accounts. The catch is that you will not be able to withdraw your money during the time period and if you do you might receive a financial penalty from the bank for withdrawing before the term finished.

Regular bank accounts or current accounts will provide you with little or no interest, so when you factor inflation into the equation your money is actually loosing value. The problem is we often work very hard for our money so many of us don’t like riskier investments such as the stock market.

This is when a time deposit can be a great financial tool to help you build up your savings as they are extremely low risk and can offer some good interest rates.


How does a time deposit work?


Most banks in the Philippines offer a time deposit, first think about how much can you afford to lock away and for how long? The longer you are able to lock the money into the time deposit the better the interest rate you get. Typically people will get from 6 months up to 5 years, 5 years offering the best interest rate, remember the more money you put into the time deposit the higher the interest rate you’ll get. 
Once you have calculated how much you want to save and for how long, now you can use money monster to compare the best time deposits in the Philippines. Although the best interest rate is one of the main factors when choosing which time deposit you want, you also want to consider the banks reputation, financial status (is the bank healthy and unlikely to go bankrupt) and the fees they will charge if you decide to withdraw your funds from the deposit (which is not recommended).
Banks will usually have a minimum deposit required, for the very best  interest rates this can be a deposit of over 1 million pesos or as little a few thousand pesos for the regular time deposit rates. 
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