You and your partner share everything together. You share a home. You share friends. You may have accidentally shared a toothbrush first thing in the morning. You’ve shared all of these things, but should you share a bank account?
Find out all of the scenarios where opening a joint bank account is a good idea.
When you share a household with your partner, you might want to open a joint account where you can pool money for your joint household expenses. These household expenses include your rent/mortgage payments, your utility bills and even your shared groceries. It will be easier to pay for these expenses out of a single joint account instead of splitting the costs between your individual accounts.
If you’re going to make a joint account for your monthly household expenses, you should consider creating a joint household budget. This will help you organize all of your expense categories and keep track of your spending. Certain budgeting apps, like HoneyDue, are designed with couples in mind. Create and track your budget together.
When you share a household, you will want to create a household emergency fund. This collection of savings can help you cover urgent repairs right away. So, if your toilet overflows in the middle of the night, you can call up an emergency plumber to fix it without worrying about how you’ll afford their bill.
Your emergency fund should be in a joint savings account because you and your partner will both want to have instant access to it. If your partner happens to be away for the week, and the furnace breaks down, you’ll want to be able to pay for a repair before they get back.
If you can’t access those funds, you might have to consider a borrowing option to help pay off the expense in a short amount of time, like a personal loan. With an approved online loan, you can use temporary funds to cover the emergency quickly and then follow a repayment plan afterward. You can click to have personal loans explained in more detail — this information could come in handy.
When you share a joint emergency fund, you don’t have to worry about this situation. Either of you can make a withdrawal whenever necessary.
Shared Savings Goals:
You and your partner will have some shared savings goals over the years. You might want to set aside money for a wedding, a home renovation or a once-in-a-lifetime vacation. These are goals that deserve a joint savings account. Sharing the account will make it easier for the two of you to make contributions over the months, and when you finally reach your savings goal, the two of you can make necessary withdrawals or transfers.
The Caveat of Joint Accounts
It’s never a good idea to put all of your money into joint accounts. Doing this will make you very financially vulnerable. When your money is placed in a joint account it is considered the property of both users. So, if the other user decides to withdraw everything from the account, even without asking you for permission, it’s not considered stealing in the eyes of the bank or the legal system. It is technically the user’s money to do with as they please.
You should always maintain some personal bank accounts that go unshared, even when you trust that your partner will never commit financial infidelity. You can always transfer portions of money from these personal bank accounts into your joint accounts. This will help you maintain a basic level of financial security and independence.
For all your shared expenses and savings, consider a joint bank account. It could make managing your money a whole lot easier!