For many Filipino retirees, financial peace of mind isn’t always a guarantee. In today’s economy, keeping money in a standard savings account is seldom enough to outpace inflation, much less generate any meaningful growth.
Unfortunately, anxieties over finances can cause retirees to venture into riskier investment options. While investments in stocks or real estate can sometimes pan out, these ventures can require building a certain amount of expertise, often making them overwhelming or impractical.
For many retirees, the ideal investments are ones that offer a good mix of safety and growth. The right time deposit can offer both, especially now that these products have evolved significantly in recent years. Here’s why retirees need to look into time deposits as part of their portfolio:
1) Better Rates Than Typical Savings Accounts
Time deposits tend to have higher interest rates compared to standard savings accounts. Where traditional savings usually earn far less than 1% per year, many emerging digital banks now offer time deposit products with returns of up to 6% per annum. Maya’s Time Deposit Plus also allows account holders to add more to their initial deposit anytime and further maximize their interest earnings. For retirees, time deposits provide opportunities to earn a decent passive income without additional effort or exposure to market swings.
2) Zero Market Risk and Guaranteed Returns
Time deposits come with fixed interest rates, which means that they’re locked in from day one. This sets them apart from more volatile traditional investments like stocks, making them especially appealing for retirees who prefer not to worry about daily price fluctuations. Once you’ve signed, you’ll know exactly how much your deposit will earn over the chosen period, making time deposits ideal for medium-term planning.
3) Modern Plans Offer Flexible Terms
Getting a time deposit used to mean locking up your funds for years. However, these instruments have evolved significantly, with many providers now offering terms as short as 90 days or as long as 12 months. Some digital banks even allow multiple time deposit accounts to be opened simultaneously, which is useful if you want to stagger access to your funds and keep them productive.
4) Easy Top-Ups for Growing Your Savings
A common drawback of traditional time deposits is that you can’t add more funds once the account is set up, limiting what you can do with any cash windfalls that come your way before the term is up.
Fortunately, a recent wave of more flexible digital offerings now allows you to top up your deposit at any time, until you hit your goal amount. This is a major plus for retirees who may receive funds in batches (such as pensions, bonuses, or remittances) since they can put any new funds to work immediately.
5) Low Entry Points Make It Accessible
Time deposits used to have high minimums that only made them worthwhile for high-net-worth individuals. Today, however, you can get started with no minimum balance and a goal of as little as PHP 5,000, depending on the provider. That makes it easier for retirees across different income levels to access better interest rates without needing to put up a significant amount.
6) Protected by Government Regulation and Insurance
Unlike many other potential investments, time deposits at institutions regulated by the Bangko Sentral ng Pilipinas (BSP) are held to the highest standards of transparency, security, and accountability. It’s not just traditional banks that enjoy this oversight, but also the digital banks that offer the latest in high-performance time deposits.
Going with a regulated institution also means your time deposit is covered by the Philippine Deposit Insurance Corporation (PDIC), which insures deposits of up to PHP 1,000,000 per depositor. Having all these layers of protection can give retirees invaluable peace of mind, knowing their hard-earned money is both secure and able to grow at a guaranteed pace.
7) All-in-One App Convenience
Even as Philippine finance continues to digitally transform, many retirees may not have the time to learn how to manage several different platforms. Fortunately, some of the modern digital banking apps that retirees already use to manage their savings can also be used to open time deposits or test out other investments. That means no need to visit physical branches or juggle different logins. So long as you’re with the right bank, you can just tap, track, and grow your funds in one place.
8) A Low-Stress Way to Stay Financially Active
Staying on top of your finances can be stressful, especially when you don’t have a lot of money to go around. But compared to other conventional investments, time deposits provide a much less involved way to remain financially active without all of the stress. This is especially true if you go with a time deposit that lets you top up.
Retirement Doesn’t Mean You Have to Keep Standing Still
Retirement can be a difficult time for many reasons, but thanks to new financial products, your finances don’t have to be put on hold. With the right tools, you can find a mix of investment vehicles that can keep your lifestyle going without all the stress of active trading.
Thanks to their collection of perks and guarantees, time deposits should probably be on your list of investments to explore. With fewer barriers to enjoying their high interest rates, you owe it to yourself to see what they can do to grow your retirement funds.
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