With the Joint Account, you can synchronize your budgets and expenditure and manage a unified financial vision with one account that’s twice as nice.
Joint account is an account shared between two persons, which are mostly relatives, couples, or business partners who have a level of familiarity and trust with each other.
A joint bank account can make your financial life easier and less complicated if you manage your money with another person, such as a spouse or partner. A joint savings or checking account offers many everyday banking conveniences, but there are some factors to consider before opening a joint bank account.
How do joint bank accounts work?
- Joint bank accounts work similarly to other bank accounts. Joint checking accounts work like checking accounts, letting you write checks and use a debit card. Joint savings accounts work like savings accounts, keeping your money safe and paying interest.
- The primary difference is that both people who own the account have full control over it. Each account owner can get a debit card, write checks and make purchases. Both account holders can also add funds or withdraw them from the account.
- The money in joint accounts belongs to both owners. Either person can withdraw or spend the money at will — even if they weren’t the one to deposit the funds. The bank makes no distinction between money deposited by one person or the other, making a joint account useful for handling shared expenses. But a joint bank account should only be opened with someone whom you trust, since that person has equal control over the account’s funds.
Is a joint bank account right for you?
If you’re wondering who owns the money in a joint bank account, that’s an excellent question. Corbin Blackwell, a financial planner at Betterment, says it’s also one that should lead you to think long and hard before opening a joint account with just anyone.
“Because joint accounts mean joint ownership, you should only fund a joint account if you completely trust the joint owner, as they will have access to funds that you deposit into the account,” she says.
If you share an account with someone who has trouble sticking to a budget, you could see more money being taken out of the fund than you’re comfortable with.
Some examples of times when a joint bank account makes sense are:
- Couples who manage their money together and share household expenses
- Adult children sharing a joint bank account with elderly parents
- Business partners sharing a joint business account to cover expenses and payroll
- Parents opening a joint account with their children to oversee their savings as they learn positive money habits
How to open a joint bank account
The process of opening a joint bank account is similar to opening an individual account. You can sign up for a joint account at a bank branch, and many banks and fintech companies allow accounts to be opened online.
When you open a joint account, both applicants have to provide personal information, such as email address, name, address and phone number, as well as Social Security number and date of birth.
Many banks also allow you to add another person to an existing bank account by contacting the bank and providing all the personal information required.
How to close a joint bank account
Closing a joint account is similar to closing any other bank account and may require a visit to a bank branch with both account holders present.
Have proof of identity (like a valid photo ID, such as a driver’s license) available when you close a joint account. You will also need to withdraw or transfer all funds from the account before closing it. A completed form requesting the closure, either online or in person, typically is required.
A request to close a joint account can also be faxed, emailed or mailed, depending on the bank or credit union. If your joint bank account is with an online bank that doesn’t have any branches, each account holder may need to enter their sign-in credentials and approve the closure.