Opening a joint bank account is a big step for a lot of couples. For some, it happens when they move in together, get engaged, or get married. Other times, couples keep their finances separate at first and then later decide that they want to mingle their money. (And sometimes, even married couples choose to keep all of their accounts separate.)
For people who share expenses, it's often easier and more practical to have at least some of their money in shared accounts, which makes it convenient to pay for joint expenses like housing, food, and other regular bills. While couples often share savings and investment accounts, too, a joint checking account can be a good place to start.
- Couples, parents and teenagers—as well as adult children and their aging parents—can benefit from the conveniences of a joint checking account.
- Opening a joint account is similar to opening a personal account and will require information from both partners.
- It may make sense to retain individual checking accounts, as well as sharing a joint checking account.
Who Should Open a Joint Checking Account?
Couples (whether married or not) who are in committed, long-term relationships are good candidates for joint accounts. You need to fully trust the person you open a joint account with since each account holder has full access to the money held by the account. That means that either person could withdraw money or even drain the account and close it without the other person's consent.
This equal access comes in handy during illness or other times of crisis; for example, if one of the account holders gets sick, the other can access funds and pay medical bills as well as keep the household running. And if one person dies, the other will have continued access to those joint funds without needing to deal with a will, probate court, or lawyer, as long as the account has right of survivorship.
Newly married couples managing money together aren't the only people who will benefit from a joint account. Parents and teens—as well as adult children caring for their aging parents—may want to consider a joint checking account. The parent of a teenager can then monitor their child's account activity and deposit money on their behalf. And caregivers of older or ill adults can easily access funds to pay for care.
How to Open a Joint Checking Account
Opening a joint checking account is very similar to opening an individual checking account. Select "joint account" when you fill out your application or, after you fill in one person's information, choose to add a co-applicant.
Both people may need their Social Security number, birthdate, mailing address, photo ID, and information for the accounts you plan to use to fund your new account. Another option is to add one partner to the other partner's existing account.
In a joint bank account, each account holder is insured by the FDIC. That means the total insurance on the account is higher than it is in an individual account.
Things to Consider
Managing money as a couple requires clear communication and expectations. It's important to discuss how you'll each deposit money into the account and use the money once it's there, ideally before you open the account. Remember, each person can access joint funds and talk to the bank without notifying the other person. Additionally, any money in a joint account may become vulnerable if one person has unpaid debts, as creditors can, in some cases, go after money in the joint account.
Keeping Some Money Separate
Opening a joint checking account doesn't mean you need to close your individual accounts. Many couples keep individual accounts for personal expenses, as well as joint ones for household and other joint expenses. In some cases, each partner contributes an equal sum to the account each month. Or, each person contributes an equal percentage of their take-home pay. Whichever path you choose, be sure to clearly lay out the expectations for both deposits and withdrawals.