What Is a Joint Checking Account?

Everyone’s financial situation is different, so how you decide to share a joint account is up to you. The goal is to make sure you agree on the account’s purpose and each person’s role. Clear communication here is key to help minimize any misunderstandings or mismanagement of the account.

Is a joint bank account only for couples?

No. While joint checking accounts are common among couples who want to combine certain aspects of their finances, they can make sense in a variety of situations. Some examples include:

• Parents who provide financial support for their young adult children (e.g., college-bound kids) and want to monitor their spending.
• Individuals who help manage finances for their elderly parents.
• Business partners who want to use a shared account to manage business expenses and other transactions together.

Benefits of a joint checking account

Having a joint account could be convenient for couples, families, or partners who want to pool their money, share expenses, and track their spending – helping to streamline their financial management. Also, in case of emergencies, you have the peace of mind in knowing your loved ones can access your shared funds. 

Drawbacks of a joint checking account

Shared bank accounts can be a source of conflict if they’re not properly managed. As mentioned earlier, all owners listed on the account are responsible for any activities, charges, or fees incurred (e.g., bounced checks, overdrafts, etc.) – no matter who is responsible for incurring the charge or fee in the first place.

Also, since everyone listed on the account has full access to the money, misaligned expectations or disagreements over spending could lead to conflict. Money is a significant source of stress for many people, and disputes over personal finances can seriously strain a relationship. Before opening a joint bank account, you need to feel confident that the person you’re sharing the account with will manage the money as agreed.

How to open a joint checking account

Many banks offer joint checking accounts. If you decide that it’s right for you and your goals, do some comparative shopping to find the right bank and account. Pay attention to things like:

• Minimum opening deposit or daily balance requirements
• Overdraft fees, monthly account fees, debit card fees, etc.
• Branch or ATM locations
• Overall convenience when it comes to depositing, transferring, or withdrawing money
• FDIC insurance

You’ll need to fill out an application to open an account. Depending on your financial institution, this can either be done in person or online. The bank will ask for basic information, which may include:

• Names and dates of birth for the account owners
• Mailing address
• Photo IDs
• Social Security or tax identification numbers

How to close a joint checking account

There may come a time when you no longer need or want a joint checking account. The process for closing a joint account varies from bank to bank. It’s a good idea to check with your financial institution as well as the account agreement for details. Generally speaking, only one owner is needed to initiate the closure. 

You’ll likely be asked where you want to transfer the balance – such as to an existing savings account or perhaps a new checking account. Just be sure that all account owners are on the same page with where the funds are going.