Should Married Couples Have Joint Checking Accounts?

Pros of a Joint Checking Account

A joint checking account lets you manage your household income and expenses from a single hub. Following are a few of the advantages to having a common source of spending.

Simplicity

Shared expenses like rent, utilities, food, home repairs and birthday gifts for your in-laws don't have to be tallied and squared up month after month (or item by item).

Transparency

In a joint account, both parties can see where the money comes from and where it goes. You'll know exactly what your household income and expenses are at all times, for better or worse.

Flexibility

While joint account holders have equal access (and entitlement) to funds, you can contribute to your account any way you'd like. If one partner makes more money than the other, they might contribute more.

Collaboration and Trust

Maintaining a joint account gives you and your spouse a focal point for your family finances. Use your account to build purchasing power and work toward financial goals together. Over time, you'll learn to trust each other with money. Shared responsibility and common goals are the stuff great marriages are made of: A joint account can help you build that muscle.

Cons of a Joint Checking Account

A joint account can also reveal potential areas of weakness. Spotty communication, competing goals and money mistakes can create joint problems with your checking account. Here are a few pitfalls you'll want to avoid.

Lack of Coordination

With a joint account, either party can withdraw money at any time. This is a problem if your partner is the type to run off to Las Vegas with the money, never to be heard from again. But it's also problematic if either partner is careless. Overdrafts can easily happen, as can late deposits, crossed wires, simultaneous spending—the list of potential issues is long.

Shared Liability

When you share an account, you're on the hook for each other. If one of you bounces a check, you both have to deal with an overdraft fee. If you live in a community property state and one of you owes money, a creditor can go after joint funds. If one of you spends money that was earmarked to pay the mortgage or a credit card bill, the late charges and possible delinquency on those accounts could affect you both.

Emotional Strain

It's a fact that money can be a major source of stress. Maintaining a joint checking account can increase the tension, especially when one partner mishandles money or if the money doesn't stretch far enough. If you think the stress of maintaining a joint account will outweigh the benefits or jeopardize your marriage, it might be best to avoid one.

Does a Joint Bank Account Affect Your Credit Score?

Using a joint bank account does not affect your credit score. Checking account balances don't appear on your credit report and checking accounts don't directly factor into calculating your credit score. However, if problems managing your joint checking account cause missed credit card or loan payments, or credit card overuse, those issues will affect your credit.

Additionally, bounced checks, involuntary account closures and other problems with bank accounts are reported to ChexSystems, a consumer reporting agency for banking. Banks and credit unions may use ChexSystems to check your background when you go to open a new checking or savings account. Negative information on your ChexSystems report could prevent you from being able to open a new account.

Is a Joint Account a Good Idea?

A joint account is a great idea as long as you're able to use it wisely. Joint checking can be genuinely helpful for handling shared household expenses and building a financial life together. A joint account can mean never having to ask who's paying for dinner again.

Digital account tools can make the job easier. Mobile banking gives you real-time access to account balances; text alerts let you communicate effortlessly about purchases. While digital tools can't eliminate all possible problems, they can help you run your account smoothly.

You can also reduce the complexity by keeping individual checking accounts open in addition to your joint account. That way, each person maintains some autonomy while managing their own individual transactions for themselves. With free online checking and money market accounts that pay interest widely available, there's little disincentive to maintaining both individual and joint accounts.

Tips for Managing a Joint Checking Account

Maintaining a trouble-free joint account is easier when you follow best practices. Here are a few tips for maintaining a healthy joint account.

• Start with a monthly budget. When two people share a single account, budgeting is essential. Figure out how much money you'll need to cover joint expenses and consider adding a small cushion (say, 10%). If you decide to keep your individual accounts, determine how much you'll each contribute to joint checking.
• Add savings. As you're budgeting, don't forget to factor in savings. In addition to your joint checking, you may want to establish a joint high-yield savings account for emergencies and saving toward goals like buying a home or taking a vacation.
• Agree on how you'll spend. Find a way to manage regular spending. Whether you decide to use individual checking accounts for personal expenses, stick to strict weekly or monthly spending limits, or pay yourselves in cash for individual expenses, you want to make sure joint spending is always under control.
• Develop clear rules and roles. Although the money belongs to both of you equally, you may want to designate one person to be an official account manager. The account manager monitors deposits and transactions, and gives the yea or nay on any unexpected spending.
• Check in regularly. Make a monthly date to check in so you can adjust spending and savings and plan for long-term goals. You may also want to switch off being account manager periodically, so everyone is plugged in—and no one has to shoulder the responsibility alone.

The Bottom Line

A joint checking account is a big step toward financial interdependence. It can set the tone for your financial life, which is likely to include many types of financial products and services—savings, credit cards, home loans, retirement and investments. By learning to communicate, collaborate and make good joint decisions about money, you're building toward a successful financial future.

As you grow, consider signing up for free credit monitoring through Experian to help protect your accounts, your credit and your finances overall. You'll get alerts if your personal information is found online, or a new account is opened in your name, so you can act if needed.