InvestmentsFinancial LiteracyPersonal Finance

My Coin Bank Gives Me Better Yields vs PHP100K 3-Year Time Deposit(1-min read)

On my way to a local bank to once again deposit the coins I saved through my coin bank.

Started the practice last year wherein I was able to save PHP5,200 after 39 weeks (9 months).

This time, was able to save PHP3,400 only after 16 months. Still, the fulfillment and discipline is there.

Every end of day or end of week, I empty my coin purse of PHP5s and PHP10s and put these inside a coin bank, just to keep up the habit of saving even in small amounts. Can’t see it, can’t spend it.

Admittedly, daily averages are down, from PHP19.19 last time to just PHP7.00 for this batch. Expense levels this year are exceptionally higher due to wedding preps, plus the downward direction of the market (so more buying / investing instead of loose change). 

Still, as in all investments, it’s always a matter of perspective and attitude.

Coinbank Numbers 2015.jpg

PHP3,400 in 16 months translates to PHP2,518 in 52 weeks, annualized. PHP2,518 gain in 1 year.

Compare that to a PHP100K time deposit with an annual rate of 1.125% (subject to 20% income tax).

It will earn PHP900 on its first year. Roll-over both principal and interest, it will give you PHP908 the following year for a cumulative gain of (900 + 908) = PHP1,808. So on and so forth.

Time Depo Illustration 1_zpscgsca5wl


You have to give yourself more than 3 years to earn at least PHP2,724, your PHP100K just sitting there. And I did that in 56 weeks (13 months), without even needing a PHP100K, of needing the PHP100K to be parked there.


So don’t belittle the power of saving little amounts in a coin bank. It can do you wonders, as long as you have the right mindset, perspective and discipline. 

As for the PHP5,200 I deposited 64 weeks ago, it has now earned additional interest. Sort of interest on interest. That’s money making more money for you.

smash-coinbank
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