10 Jan 2024 | Edukatips

Benefits of Time Deposits for Personal Finances

A Time Deposit is a deposit product that can be used to store funds within a certain period of time. Time deposits also offer many benefits, including an investment option because they have competitive interest rates. In general, you can only withdraw funds stored in a time deposit when it reaches maturity.

Advantages of BCA Time Deposit

BCA Time Deposit has several advantages, including:

1. Competitive Interest Rates

Time deposit interest rates are generally higher than regular savings, making it a less risky instrument. This can support your financial plan for the time period you have planned.

2. Currency Options

BCA Time Deposits are available in 9 currency options, namely Rupiah (IDR) or foreign exchange (forex), such as, United States Dollar (USD), Singapore Dollar (SGD), Hong Kong Dollar (HKD), Australian Dollar (AUD), Japanese Yen (JPY), Great Britain Pound Sterling (GBP), Euro (EUR), and China Yuan (CNH).

3. Flexible

BCA Time Deposits can be adjusted according to the type of extension and term as needed. There are three types of extensions, namely, ARO, ARO Plus, and Non-ARO. As for the term, there are 1, 3, 6, or 12 months.

4. Helps Build Financial Discipline

In time deposits, the funds deposited can only be taken when the term reaches maturity. This helps you to be more disciplined in saving for your future goals. If necessary, you can still withdraw the funds before maturity but the accrued interest will not be paid.

Types of BCA Time Deposits

As mentioned earlier, BCA Time Deposit comes in several types. Here’s an explanation of each type:

1. Extend Principal (ARO)

The deposit principal will be automatically renewed for the same period of time with interest transferred monthly to the registered account.

2. Extend Principal + Interest (ARO Plus)

The principal amount and interest will be automatically renewed for the same period of time.

3. Non ARO

Principal and interest are transferred to the registered account at maturity.

Investment Tips for BCA Time Deposit

Now that you know the types, you should also know the effective tips for investing in time deposit products. Here in the explanation:

1. Determine the Term

The number one thing to consider when investing in time deposits is to determine the time period. You can adjust the term with your financial goals. By determining the term, you can focus more on achieving these financial goals. In addition, calculate the interest rate and the estimated amount of income that you will earn when it reaches maturity.

2. Choose the Deposit Type and Currency

After that, you need to choose the type and currency of the time deposit that you want to invest in.

BCA Time Deposit comes in 3 types (ARO, ARO Plus, and Non ARO) and various currency options, Deposito Rupiah, Deposito Valas (USD), and Deposito Valas (Non-USD).

Each type of these deposits has its benefits. Now, you can choose which type and currency best suits your needs.

For full information about BCA Time Deposit and Deposit Simulation, you can check the information here. For BCA Time Deposits in Rupiah, you can open it online through the Deposit feature on myBCA. Check how to do it here.