In this week's millennial money episode, Damien and I discuss the pros and cons of having a joint bank account.
Pros of having a joint bank account
- Easier way to pay joint bills
- Helps to manage money as it is from one place
- Builds trust
- If one joint account member dies the other person has immediate access to the money without going through probate which is easier if you are married or have a family together
- FSCS protected up to £170,000 (£85,000 per person) *
*There are some nuances which you will need to check with your bank account - it applies per banking license e.g HSBC and First Direct are under the same license.
Cons of having a joint bank account
- Need to trust the person because the person has access to the money and can take it out of the account without your permission
- Both responsible for any overdraft charges
- Have to be honest about what you're spending
- You are financially linked with someone if you get a joint account with them - if they have a poor credit rating, it will also negatively affect you (Watch how to check your credit score here and how to improve your credit score here)
- Can be messy if you break up or fall out with the person you are sharing a joint account with
- Need to be on the same wavelength when it comes to assessing money goals
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