Are CD's Restricted?

In our ongoing series of Questions From the Boot Camps:

Q:
I was wondering if you would classify Certificates of Deposit as permanently restricted funds or if that is placed in a different category?

A:
CD's are a means of holding the money, like a checking account or a savings account. They are usually for a fixed amount of time, from 30 days on up to years I think. As a vehicle for holding money they would not fall not the category of restricted or unrestricted.

Now the money in the CD is a different story: as an example say you $100,000.00 to do a specific project over two years and you know that you won’t need $60,000.00 of that for the next 12 months. You could take that 60,000.00 and put it into a CD for 12 months and earn a higher rate of interest that it would typically accumulate just sitting in a checking account.

So the CD is not restricted but the money in it might be permanently restricted, unrestricted or temporarily restricted.