Explore the ups and downs of having a joint account with your spouse or other loved one so you can decide what works best for you.
One of the many questions couples have to answer at some point in their relationship is if they should share a bank account. While most might associate this with married couples, it’s also an option for couples living together who want to streamline their finances. It can also be used among families. Knowing someone has access to funds if needed can give an account owner peace of mind.
Here are some pros and cons to consider whether you’re newly married, in a committed relations, or helping a family member.
- Access to funds when needed. This allows you to have a debit card or access to the account to withdraw funds whenever it’s necessary.
- Legal affairs. In the case that someone passes away, the joint can have access to the account immediately, versus having to obtain access through a will or the legal system.
- Keep track of bill payments. With bills being paid all from one place, you can be sure that one won’t get missed.
- Contributing to shared goals. As you plan for your future, you and your loved one can both see how your savings grow. This can help keep each other motivated and accountable to make smart financial choices to reach your shared dreams.
- Money management. As a joint on an account, you may feel the need to discuss each item you buy with your partner. Talk about how you want to handle purchases so there aren’t any surprises.
- Loss of financial freedom. Some couples might feel like a piece of their independence is gone when they merge their accounts.
- Gift shopping. Shopping for a special gift may be difficult to hide from our partner if they have full access to your transactions and bank statements.
- Separation issues. A joint account can cause issues down the road if the couple ever decides to split. Each individual on the account has the opportunity to withdraw money potentially putting the other person in a bind.
You also have the option to maintain an individual account and add a joint account with your partner to avoid any of the issues listed above.
At the end of the day, it’s up to you and the other individual to decide if a joint account is the right option. Do what makes sense for your budget, goals, and overall happiness.