How does a joint account work?
Joint accounts often work like any other current account. The main difference is that there are two of you who are responsible for the income and outgoings of the account. If you have shared financial commitments, such as a mortgage, rent or other household bills, a joint account allows you to pay these outgoings from one place, making it easier for you to manage as a pair.
How do I set up a joint account?
You can set up a joint account like any other current account – some banks might let you do this online, while others will ask you to go into a branch and set it up in person. You’ll need proof of who you are and your address.
How many people can share a joint current account?
A joint account is usually shared between two people. However, some banks allow up to four people to share an account – useful if you’re living in a shared house as a student or with a partner.
What are the benefits of a joint account?
Having a joint current account to pay for household expenses, like bills, food, rent or a mortgage, means you can keep track of your outgoings and budget more easily. Once you’ve paid in your agreed monthly amount, you’ll know exactly how much of your wages are left. You might want to put this amount into your own current account or a savings account.
What’s more, if all or both of you pay a set amount into the account each month, it helps to avoid arguments over who owes what.
What are some of the disadvantages of a joint account?
With a joint bank account, someone else will have access to your money. If your salary goes into the account, the other joint account holder will be able to see just how much you earn, and vice versa. The other account holder is also entitled to withdraw all of the money.
But it’s not just a lack of financial privacy. You’re also binding yourself to another person who may or may not be as savvy with their money as you, and any bad credit experiences on that account will reflect badly on you too.
Who manages what with a joint bank account?
It’s up to you and your fellow account holder to decide who does what. What you agree on will be set out in a ‘joint account mandate’, which makes clear whether only one or all of you can withdraw cash, sign cheques or close the account. The mandate itself can be cancelled or amended, but you can agree whether only one or all of you control this. When it comes to debts, you’re all responsible.
How much can each person withdraw from the joint account?
If you’re married to the other joint account holder, you’re both assumed to have an equal right to the money in there – no matter how much an individual put in. So, if you put in £250 a month and your spouse £500, then you each have a right to all of it, even though you put in less.
If you aren’t married and have access to a joint account but don’t put money in it, then you don’t have an automatic right to the money – unless it can be proven that the account was intended for both of you to use, or a mandate is set up in place to be able to withdraw the money.
Frequently asked questions
Can I have my own separate bank account as well?
There’s nothing stopping you from having your own separate bank account, as well as a joint account with another person. A joint account is useful for those with shared financial responsibilities, but you may want to keep your other earnings separate, for whatever reason.
You’re entitled to set up a personal account with the same account provider, or go with another bank. It’s important to know that, if you have separate joint and personal accounts with the same bank, the bank can transfer money from the single account to the joint account, to cover any outstanding debts. They cannot do the reverse, without the consent of both joint account holders.
Can we each have our own debit card?
A bank can issue more than one debit card for the same account, for which the bank can charge an annual fee. However, some banks may issue identical cards with the same 16-digit number and CVV number (the 3-digit security number on the back of the card). It’s always good to check with your bank what your options are.
With identical cards, you can return things and get a refund more effectively and build up loyalty points more easily (like Nectar points). Cards with a different CVV and 16-digit number allow you to keep a close eye on individual transactions.
Some people use a joint account but don’t have debit cards; they simply use the account to set up direct debits and standing orders to pay off shared expenses.
What if we are not married; can we still get a joint account?
You don’t normally need to be married to open a joint account. While it’s popular with married couples, you won’t typically be refused an account for not being married. Joint accounts are often used for those with joint financial responsibilities, such as a mortgage or rent, but you can apply for one regardless.
Can joint accounts have overdrafts?
You should be able to apply for an overdraft on your joint account. It’s important that you agree this with the person you’re setting up the account with, to understand your responsibilities as a pair. If one of you overspends and the account ends up overdrawn, you’re both accountable for the debt, and any relevant charges. For this reason, it’s important that you agree with each other, as well as the bank, as to an overdraft that’s truly necessary.
What happens if we start arguing over the joint account?
If your relationship with the other joint account holder(s) breaks down, then it’s important to cancel the joint account mandate as soon as possible. This essentially freezes the account so that no one can run off with all the money, although you can still deposit money. You’ll need to decide how you split what’s left in the account; if you can’t, then the courts will decide for you.
Can we get a joint savings account?
Setting up a joint savings account is a great idea if you’re looking to make a big purchase, like a house, together. It means you can work towards your goal together, with both of you able to deposit funds and contribute. You should have all the benefits of a single savings account, but simply with two, or even more, people.
However, you can’t open a joint ISA. The ‘I’ stands for ‘individual’, so there are no options for a joint account.
Comparing joint current accounts
Searching for a current account is the same whether you want a joint account or one just for you. You’ll need to compare benefits and consider whether you need an overdraft and if so, how much. The only difference is that with a joint account, you’ll both need to agree on what’s important. So, let’s start comparing.