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 open a joint bank 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. With two sets of income making up the account, you could also earn more if you get a good interest rate. 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. This could impact your credit rating.
Will opening a joint bank account impact my credit score?
Just opening a joint bank account shouldn’t impact your credit score in the long term (although the bank will run a credit check on you). Opening a new account will usually lower your credit score at first, but this is common, and it should bounce back within a few months, if you’re using it well. What will impact your credit score is how you use the account. If you enter your overdraft or can’t manage other debts tied to the account, this will impact your ability to secure new finance. And remember, you’re both responsible for the joint account. So, any debt your partner racks up will be tied to you as well, which means you’ll both be responsible for paying it off and both of your credit reports will be marked.
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.
If one of you withdraws or spends more than your account balance, you’ll both be held accountable for entering your arranged overdraft.
Can I open a joint credit account?
Yes, you can open a joint credit account. This is pretty normal for couples who have joint financial responsibilities. It can be useful, because both of your credit ratings will be taken into account, which means it could provide access to credit, like a credit card, for people who may not otherwise qualify, if their partner’s credit score is high enough. It can also work the other way though. If one of you has a much higher credit score, the other’s score may cause you to pay higher interest rates or have a lower credit limit.
Just remember, you’re both responsible for managing your credit account, so if one of you racks up a load of credit card debt, you’ll both be held accountable for paying it off and it will affect both of your credit ratings.
Frequently asked questions
Is it illegal to have two current accounts?
No, it isn’t illegal to have two current accounts. You can open as many current accounts as you like. These can also be with different providers, meaning you have the freedom to open accounts with anyone you like.
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.
Can I open a joint bank account online?
Yes, you can open a joint bank account online, but not every bank will offer this. Depending on who you’d like to open a joint account with, you might need to pop into a branch and set up the account in person. However, just because you’ve set up the account in person, doesn’t mean you won’t have access to online banking and other digital features.
Can I access a joint bank account through mobile banking?
Yes, you should be able to access your joint account through your provider’s online banking or mobile banking app. This will allow both of you to access and manage your account online and on the go.
Can unmarried couples have a joint bank 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.
Is a joint account a good idea?
A joint account is a good idea, so long as you and your partner trust each other and are willing to share the responsibility. It can make paying for joint outgoings, like rent, a mortgage, household bills etc. easier to manage and can prevent any confusion over who should be paying what. Just remember, you’re both responsible for the income and outgoings of the account, including any debt you may get into. So, make sure you’re both committed to using the account responsibly.
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.