One account, two names
Opening a joint account with your partner is a huge commitment and one of the biggest decisions you will make in your relationship. Only do it if you completely trust them to responsibly access the money, in good times and in bad.
Here are some tips to work out whether a joint account is right for you.
It’s not a good idea to open a joint account with someone you have just met as you are giving them access to your money. Joint accounts are only suitable for people who trust each other deeply, like a family member or your long-term partner.
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Be very wary of anyone pressuring you to open a joint account. People do have money troubles and may see you as a way to help solve their financial problems.
If you open a joint account which offers credit, and one account holder racks up a large amount of debt they can’t pay back, you both risk having a bad entry on your credit report. You are also legally responsible for paying off the debt.
People often open a joint account because they pay fewer fees with one account than two. It can also make joint payments like mortgage, rent and other bills easier to manage.
Joint accounts work well for people who spend money in a similar way. Both people should agree how and when they will deposit and withdraw money, to meet the same goals.
If you are thinking about opening a joint account, ask yourself:
- Do I trust the other person completely even if times get tough?
- Do we communicate well about money matters?
- Do we have similar goals for our money and similar spending habits?
- What is our objective in opening a joint account? Is there a better way to achieve this objective?
A shared account for shared bills
One way to make things more convenient for you and your partner would be to keep your money in separate accounts but open one shared account for your shared bills. Discuss with your partner what bills you will pay with your shared account and how much you each will contribute.
There are two types of joint accounts.
Both to sign
This type of account only allows transactions to be made when both parties sign. For example, if you don’t agree that your partner should spend money from the account on a new motorbike, they wouldn’t be able to access the money without