What Is a Joint Checking Account?
Updated: May 22, 2024
Advertising & Editorial Disclosure
A joint checking account is a bank account owned and accessible by two or more individuals. It allows multiple account holders to deposit and withdraw funds, write checks and make purchases using the same account. Married couples commonly use joint checking accounts to pay household bills and manage shared expenses.
These accounts can also be beneficial for business partners, roommates splitting rent and utilities or adult children assisting elderly parents with finances.
Joint checking accounts allow two or more people to share access and responsibility for a single bank account.
Joint checking account benefits include easier budgeting, increased FDIC insurance coverage and shared account management responsibilities.
Opening up a joint checking account is like opening a standard checking account, but each account holder must sign and agree to the account terms.
A joint checking account allows two or more people to share equal ownership, access and responsibility over a single bank account. All account holders can deposit and withdraw money, write checks, make purchases with a debit card and make other banking transactions.
The account works like an individual checking account but with more than one authorized user. Any deposits made by any account holder go into the same shared pool of money. Withdrawals, purchases, bill payments and other debits are also deducted from this balance.
All account holders receive statements and have full visibility into balances and transaction history. Any account holder can handle tasks like ordering new checks or updating personal information.
While joint checking accounts offer convenience, equal access to funds and shared responsibilities mean that account holders should be on the same page about managing the account wisely.
Sharing a joint account can be wonderfully convenient or a difficult responsibility to manage, depending on your financial circumstances and the person you share an account with. Being well-informed and having clear communication can help prevent any issues before they arise.
Opening a joint checking account requires trust and communication between all account holders. Before merging your money, you should have an open discussion with your future joint account holder. Talk about your individual financial habits, budgeting styles and expectations for the shared account. Make sure you’re in agreement about how you will use and fund the account.
You may want to agree on some key ground rules, such as spending limits, overdraft policies, minimum balance requirements and who will be the primary monitor of account activity. It's also wise to have contingency plans for what happens if one person can’t contribute their share or your relationship changes.
A joint account can be beneficial for many types of relationships:
Account Holder Types | Description |
|---|---|
Couples | Married partners often use joint accounts to pay household bills and expenses from a single pooled account. |
Dependents | Parents can add children or dependent adults to a joint account to assist with money management. |
Elderly Parents | Adult children may open a joint account with aging parents to help oversee their finances and pay expenses. |
Business Partners | Co-owners of a business can use a joint account to pay shared operating costs and expenses. |
Opening a joint checking account is usually straightforward, but making sure that all account holders have a shared understanding of what’s involved will help avoid surprises and mistakes.
Not all banks and credit unions offer joint accounts, so start by finding ones that do. Compare fees, interest rates and account features.
You'll need to provide identification documents, such as driver's licenses or passports, for all account holders. The bank may also require proof of address, Social Security numbers or other documents.
Each account holder must review and sign the agreement documents and acknowledge the terms and conditions.
A minimum opening deposit, typically around $25 to $100, is required to activate the new joint account after approval.
Yes, even with a joint checking account, it’s a good idea to maintain a separate individual account. For example, a married couple could use the joint account for shared expenses like the mortgage and utilities while keeping personal accounts separate for independent spending.
An individual account also provides a backup in case issues arise with the joint account.
There may come a time when you no longer want or need a joint checking account, whether due to the end of a relationship, divorce, switching banks or other reasons.
If there are disagreements between account owners, the bank will likely freeze the account until ownership is legally determined, such as through a court order. In some cases, one party may be able to be removed from the account while the other keeps it open.
It’s a good idea to inform the other account holder of your intention to close the joint account.
Review the account for recurring transactions like bill payments, direct deposits or transfers.
Once all outstanding transactions have cleared, withdraw any remaining funds from the joint account so the balance is zero.
With the balance at zero, you can then provide written notice to the bank requesting full closure of the joint account.
If you see suspicious activity in your joint account, you should speak with your joint account holder to see if they made the transactions. If not, contact your bank immediately and request new account numbers and debit cards. You may need to freeze the account temporarily.
Monitor future statements and sign up for text or email alerts from your bank so you're notified of any unusual activity.
We compiled answers to your frequently asked questions about joint checking accounts.
Managing a joint checking account involves communicating and sharing responsibility. Review account activity regularly, set spending limits and establish financial goals together.
Generally, joint checking accounts do not directly impact credit scores. However, if the account becomes overdrawn or negative, it could lead to collection actions that might affect credit.
In the event of a joint account holder's death, the surviving account holder typically gains sole ownership of the funds in the account. The account may be frozen temporarily until the necessary documentation, such as a death certificate, is provided to the bank.
Removing someone from a joint checking account can be more complex than adding them. Typically, all account holders must agree to the removal. Most banks require you to close the joint account and reopen a new personal account instead of removing one person from the joint account.
All account holders are considered equal owners in joint checking accounts. Joint checking accounts can complicate tax matters as all owners are responsible for reporting and paying taxes on the interest earned. Each account holder may need to report their share of the interest income.
About Alvin Yam, CFP
Alvin Yam is a certified financial planner (CFP) with over 15 years of experience working with individuals and corporations. Before founding Paraiba Wealth Management, he was a director at HSBC and a financial consultant at Charles Schwab. Yam is MoneyGeek's expert consultant on wealth management and personal banking.
Yam earned his bachelor's degree in political science from the University of California, San Diego, and his Master of Business Administration from Loyola Marymount University.
The content on this page is accurate as of the posting/last updated date; however, some of the rates mentioned may have changed. We recommend visiting the lender's website for the most up-to-date information available.
Editorial Disclosure: Opinions, reviews, analyses and recommendations are the author’s alone and have not been reviewed, endorsed or approved by any bank, lender or other entity. Learn more about
our editorial policies and expert editorial team.
