Joint Bank Accounts: How and When They Work

Families and partners need good communication to manage a joint account. Opening a joint account is a simple process.

Tony Armstrong leads the banking team at NerdWallet. He has covered personal finance for nearly a decade. Tony began his NerdWallet career as a writer and worked his way up to assistant assigning editor and then to lead assigning editor. His writing has been featured by the Los Angeles Times, MarketWatch, Mashable, Nasdaq.com, USA Today and VentureBeat. Tony lives in Minneapolis, Minnesota.

Kathleen Burns Kingsbury

Wealth psychology expert and coach Kathleen Burns Kingsbury, founder of KBK Wealth Connection and host of the Breaking Money Silence podcast, is an internationally published author and speaker. As an expert on financial psychology, Kathleen has appeared on television and her work has been featured in The New York Times, The Wall Street Journal, "PBS NewsHour," Money magazine, Today Money, Forbes and CNBC. Kathleen served as an adjunct faculty member at the McCallum Graduate School at Bentley University from 2009 to 2019 and currently teaches at Champlain College.

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Sara Clarke
Assistant Assigning Editor | Banking

Sara Clarke is a Banking editor at NerdWallet. She has been an editor and project manager in newsrooms for two decades, most recently at U.S. News & World Report. She managed projects such as the U.S. News education rankings and the Best States rankings. Sara has appeared on SiriusXM Business Radio and iHeartMedia’s WHO Newsradio and has been quoted in The Salt Lake Tribune, The St. Paul (Minnesota) Pioneer Press and other outlets. She is based near Washington, D.C.

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Joint bank accounts belong to multiple people, each of whom can contribute to and use the money in the account. Such accounts can be a good fit for couples, adults assisting their aging parents and parents who are teaching their kids about money management.

On paper — and in an ideal world — joint accounts provide easy collaboration for spending and saving. But realistically, they require more self-awareness and trust than the typical bank account.

Here's a closer look at what to consider before opening a joint account.

Is a joint bank account a good idea?

A joint bank account can be a good idea as long as you and the other account holder have a strong, trusting relationship. Whether you’re planning to share an account with a child, significant other or aging parent, communication is essential. That may mean having difficult discussions about spending and saving habits. As uncomfortable as it may be, initiating these types of conversations can prevent even bigger headaches later.

Pros of joint bank accounts

Parents can monitor a child’s spending habits and can quickly transfer money to a joint account when necessary.

Couples can use cash in a joint account to cover shared expenses such as rent, utilities and food, as well as shared savings goals, such as setting aside money for a vacation. Joint accounts can be helpful for married couples who are combining assets as well.

A joint account can be set up so that if a parent dies, an adult child has immediate access to funds in the account, avoiding a potentially lengthy legal process.

. (Joint accounts and individual accounts are considered different ownership categories, so a person can be insured for up to that amount in a joint account and separately for up to that amount in an individual account. Learn more about FDIC insurance .)

SoFi Checking and Savings

SoFi members with Direct Deposit or $5,000 or more in Qualifying Deposits during the 30-Day Evaluation Period can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. Members without either Direct Deposit or Qualifying Deposits, during the 30-Day Evaluation Period will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Only SoFi members with direct deposit are eligible for other SoFi Plus benefits. Interest rates are variable and subject to change at any time. These rates are current as of 8/27/2024. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.

EverBank Performance℠ Savings

Barclays Tiered Savings Account

These cash accounts combine services and features similar to checking, savings and/or investment accounts in one product. Cash management accounts are typically offered by non-bank financial institutions.

These cash accounts combine services and features similar to checking, savings and/or investment accounts in one product. Cash management accounts are typically offered by non-bank financial institutions.

on Wealthfront's website

Wealthfront Cash Account

on Betterment's website

Betterment Cash Reserve – Paid non-client promotion

*Current promotional rate; annual percentage yield (variable) is 5.50% as of 4/2/24, plus a .50% boost available as a special offer with qualifying deposit. Terms apply; if the base APY increases or decreases, you’ll get the .75% boost on the updated rate. Cash Reserve is only available to clients of Betterment LLC, which is not a bank; cash transfers to program banks conducted through clients’ brokerage accounts at Betterment Securities.

CDs (certificates of deposit) are a type of savings account with a fixed rate and term, and usually have higher interest rates than regular savings accounts.

CDs (certificates of deposit) are a type of savings account with a fixed rate and term, and usually have higher interest rates than regular savings accounts.

Marcus by Goldman Sachs High-Yield CD

4.70% APY (annual percentage yield) as of 08/30/2024

Federally insured by NCUA

Alliant Credit Union Certificate

Annual Percentage Yield (APY) is accurate as of 08/20/2024

Discover® Cashback Debit

Chase Total Checking®

Deposits are FDIC Insured

Chime Checking Account

Discover® Money Market Account

Cons of joint bank accounts

» Looking for savings options? See NerdWallet's best savings accounts

Joint bank accounts and marriage

Joint bank accounts are a common consideration for newlyweds since the couple has just legally combined their assets . Some couples may find it valuable to open a joint account even before the wedding so they can use it to pay for the event. Couples who live together before marriage may also find a joint account useful for paying for household expenses. Another benefit of joint accounts is that FDIC insurance covers $250,000 per co-owner, so the total coverage for the account is $500,000.

Before you open an account, make sure you know the rules on your joint account, including who is allowed to close it. According to the Consumer Financial Protection Bureau website, “In most circumstances, state law provides that anyone who can write checks on the account has the ability to close the account.”

If you’re married — especially newly married — talk to your spouse about whether and how they’d like to set up a joint account with you. If you do decide to open a joint account, keep in mind that you don’t have to combine all of your money with your spouse’s. Some married couples share a joint account while also maintaining separate personal accounts, even if they only use those accounts as “fun money.”

How to open a joint account

Setting up a joint bank account is much like opening a personal one. Here's what the process will probably look like:

Provide the bank or credit union with personal information for all account holders, such as addresses, dates of birth and Social Security numbers.

If you’re opening a joint account with a significant other, you don't necessarily need to close your individual account. You may want to have money of your own for personal expenses or for gifts and surprises.

Become a Nerdwallet+ member, open an eligible bank account, and make a direct deposit within 45 days to start racking up rewards.

Joint accounts for teens

If you have a teenager, you might also consider opening a teen checking account. These accounts can have lower fees and may place daily restrictions on how much cash your child can withdraw from an ATM. However, if your bank or credit union doesn’t offer teen accounts, you may need to open an account at a different financial institution, which could make it more difficult to transfer money easily. Check with your bank for options for opening a bank account for your teen. ( See our picks for top checking accounts for teens. )

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