Joint Bank Account 101: Everything You Need to Know Before Opening One
There are many changes that occur once you decide to fully commit yourself to another person. One of the most important ones is money management. How will you two decide to share money? Will you keep your accounts separate, or will you pool money together for future purchases?
Banks know this, which is why joint bank accounts were created. Read on to find out about joint bank accounts and determine whether or not they are right for you!
What is a Joint Bank Account?
It basically is just like it sounds - it’s a bank account with two or more owners attached to it. Many married or long-term couples will end up using a joint bank account to have one pool to contribute money to, whether it be for long-term savings goals, or to use as the pool to pay bills and spend money from.
Joint bank accounts benefit long-term and married couples because it’s easier to keep minimum balances if you’re both contributing. You can also improve your budgeting skills by seeing where each person is spending their money.
How Do You Open One?
The process is incredibly similar to opening an individual account - you both go to your bank with the right identification and information and let your banker do the rest. There is also an option to add someone to an already existing account, which may be even faster than opening a new account entirely.
Do We Have to Have a Joint Bank Account?
If you aren’t fully committed to the idea of sharing your money, or you just prefer keeping your expenses separate, there are other options. One is just keeping your individual bank accounts as-is. Another is what is called a linked-account; two separate accounts are linked together in order to make money transfers more easily. With this option, you still have your separate individual accounts, but you can see actions in the other account and make payments or transfers when needed.
You can also set up a feature where deposits are made directly into the joint bank account, and then can be divided up and transferred to their respective individual accounts once the shared amount has been left in the joint account.
The options for managing money as a couple are plentiful! Just be sure to do your research, make sure your partner is on board, and pick the situation that’s right for you.
Need guidance on how to open a joint account? Schedule a free 60-minute consultation with us today to discuss this and other financial needs!