How do joint bank accounts work?

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A joint current account can help you share and organise expenses or bills. You can get one with your partner, housemate, or a family member. Here is how they work, their risks and benefits, and how to choose the right one.
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Joint accounts are very common and a great way to manage your money with another person. It may be your partner, friend or housemate. Instead of paying separately for shared costs, such as household bills or childcare, you can use a joint account. Some joint accounts also include great benefits, such as interest on your balance or cashback when you spend.

What is a joint bank account?

A joint bank account works in the same way as a personal current account but there are two or more account holders who can access and use it.

They are usually taken out by people who live together - couples, housemates or family members - but there are no strict rules around this. How you use the account is up to you. For example, all account holders could pay a set amount of money into a joint account and use it to pay for shared costs, such as:

  • Mortgage or rent payments

  • Utility bills - like gas, electricity and water

  • Childcare costs

  • Groceries

  • TV licence

  • Council tax

  • Entertainment - like TV subscriptions

Some banks only let you open a joint account with one other person, but some let you have four or more people named on a bank account. You can usually open them with anyone: you do not need to be married to or living with the other account holder.

Pros and cons of joint bank accounts

Pros

Can cover joint bills and spending

Both members can check and run it

Helps to avoid arguments over missed bills

Keeps joint spending in one account

Cons

You have to trust the other person

It could damage your credit record

There can be complications if you fall out

If you use the overdraft, all the account holders could get into debt


How to get a joint bank account

You can apply for a joint account in the same way as getting a bank account by yourself by following these steps

  • Compare joint accounts using our comparison

  • Decide on the best joint account by working out which features you need

  • Apply online, in a branch, by phone or by post

  • Decide if you want everyone to sign to make withdrawals or if these can be approved by any of the account holders

  • Provide ID documents requested by the bank 

  • Start using your account

How to apply for a bank account

How to work out which features you need

You can get almost any current account jointly with someone else. When you choose an account, decide which of the following you need:

  • Online banking

  • A mobile app

  • Interest paid on money kept in the account

  • Direct debits and standing orders

  • A debit card for each account holder

  • An overdraft

  • A cheque book

  • Rewards or cashback on your spending or bill payments

Here is how to decide what features you need and pick the right joint account

Decide on who can make withdrawals

You can sometimes set up a mandate on the account, which specifies who can run it. You can choose between:

  • Any to sign: Anyone named on the account can make changes or spend the money in it.

  • All to sign: Any changes to the account, spending or withdrawals need the permission of all account holders.

Most current accounts have an ‘any to sign’ mandate and come with a debit card for each person, meaning any of you could manage and spend the money in the account.

Compare joint bank accounts

Who looks after the account?

How much do they cost? 

Joint accounts come with the same charges as personal accounts, including:

  • Failed direct debits fees

  • Overdraft charges

  • Annual or monthly fees for some packaged accounts

If you manage your account carefully, you should be able to use it for free. 

How to manage your bank account to avoid paying charges

A joint account could cost you money if another account holder spends too much, which could:

  • Use up some or all of the money in your account

  • Leave you overdrawn, which means you owe money to your bank

  • Mean you have to pay interest charges on what you owe

  • Lead to fees if you exceed your overdraft limit

If this happens, both you and your joint holders are responsible for paying back the money that’s overdrawn along with any interest or fees.

There are lots of joint accounts to choose from and therefore it’s worth comparing providers and accounts to find one that suits you and one that is affordable.  

How much will an overdraft cost?

Fees on overdrafts used to be hard to understand as there were different rates depending on the provider and the amount of money you borrowed. However, new rules were introduced in 2020 and you will now see the cost of an overdraft as the APR (annual percentage rate). This makes it a lot easier to compare the costs of overdrafts, which is helpful when looking for a new account. There are no longer different fees for using an authorised or unauthorised overdraft and you won’t be charged daily or monthly fees for using one. 

How they affect your credit record

If you hold a joint account with someone else, their financial history becomes linked to yours.

If they have had debt problems in the past or miss repayments in the future, this could put lenders off offering you a loan, mortgage, overdraft or credit card even in your sole name.

This is because any form of borrowing shows up on your credit record, including a current account if it has an overdraft.

They can still show on your credit record after you close the account. Here is how to remove a financial association with someone once you no longer hold any accounts with them.

What protection can you get?

The money you hold in your bank account is protected by the Financial Services Compensation Scheme (FSCS). It can protect up to £85,000 per person named on a joint account.

For example, if you held an account jointly with your partner, up to £170,000 in your accounts with that banking group would be protected if your bank went bust.

How to use your joint account

You can use a joint account in much the same way as a personal account, although how you use it will depend on how it was set up.

How to withdraw money

If everyone on the account can operate it individually, you can withdraw money by:

  • Getting cash from an ATM

  • Paying on your debit card

  • Setting up a standing order or direct debit

  • Writing a cheque

  • Withdrawing cash in a branch

  • Sending a bank transfer using internet banking

However, you cannot use all of these if you set up the account so everyone needs to sign for any transaction.

For example, your bank could only let you write cheques if they are signed by both of you, or authorise online transactions with both of your passwords.

How to keep track of your balance and transactions

Any account holders can track the transactions and balance at any time. You can do this by:

  • Signing into your internet or mobile banking and checking the statement

  • Checking your monthly paper statement or requesting one by post

  • Phoning your bank

  • Checking your balance at an ATM

  • Receiving balance updates by text message

How to remove a joint holder

You can remove one or more people from a joint account and leave it in the name of the remaining account holders. For example:

  • If you have an account with your partner, you could transfer it into just their name or yours

  • If you have an account with three housemates and one moves out, you could remove them from the account

Banks need a form of signed consent from all account holders to remove someone. Some also ask for identification documents or for you to visit a branch as well.

How to add someone to your account

You need to provide the bank with:

  • Signed permission from the existing account holders

  • Full name, address and other personal details of the new person as well as their signature

  • Any identification documents they need from the new account holder

Some banks need you all to visit a branch to provide identification and complete their paperwork.

How to close a joint account

Most banks need all the account holders to confirm the closure of a joint account. You usually need to request this in a branch or in writing.

New bank accounts are offered all the time, so compare all of the best options to make sure you get the right one for you.