Discover Bank offers a CD, known for low-risk, that's even less risky

In a sign of the times -- acknowledging both the recession and the importance of saving money for that rainy day -- Discover Bank is allowing penalty-free withdrawals from 12-month certificates of deposits for new and renewing account holders who lose their jobs.

If you open or a renew a 12-month CD between July 1 and December 31 of this year, with a minimum $2,500 balance, you can do it knowing that if you lose your job, you'll be allowed to make a partial withdrawal or close the account with the full return of your principal and any interest -- with no penalties. Seriously, this really is a good thing.

According to the press release I received, the program also applies to self-employed people "under certain circumstances." Well, what does that mean? There are a lot of self-employed people out there, of course. I'm one of them. We're not second-class citizens, folks! So I contacted Discover Bank to see if they could fill me in.

I talked to Steve Olszewski, the vice president of deposit products at Discover Bank. He said that if you're self-employed and you buy a CD and then later need to withdrawal or close the account, you'll be able to "if there's been business property damage or inventory damage or business closure for at least five days... Self-employment is obviously a little more difficult to manage," says Olszewski, "but we try to keep it in line with other types of job loss programs, like our protection products on the credit card side."

In a nutshell, it sounds as if as long as you've been self-employed for awhile, and you have the paperwork, you'll be able to withdrawal or close the account without any problems, if you need to. And obviously, hopefully you won't need to. You buy a CD not because you hope you can later withdraw from it. You buy a CD because it's a safe investment -- arguably the safest, least risky thing you can invest in. The rate for this CD, incidentally, is 2.20 APY (annual percentage yield). You can learn more about it here.

All of that said, if you do need your money, and you're self-employed, you won't be able to get it for 30 days (is it no wonder I sometimes feel like a second-class citizen?). If you're an employee and you're laid off, you can get it right away. Either way, you're going to want paperwork to prove that you're no longer working, whether a termination notice or paperwork from filing unemployment benefits. But here's to hoping that anyone who does end up investing in one of these CDs never has a reason to show Discover Bank any of that paperwork.

Geoff Williams is a freelance journalist who has written about money issues for a variety of publications and websites, including and He also is the author of C.C. Pyle's Amazing Foot Race: The True Story of the 1928 Coast-to-Coast Run Across America (Rodale).
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