Have you ever considered opening a joint account with your partner?
Many of us are hesitant to do so because we don't quite trust our loved ones enough.
Some of us want to protect our wealth from our partners, while others do not want their loved ones to know what they spend.
Here, we examine the pros and cons of opening a joint account and suggest some of the best accounts for those who decide to take the plunge together.
Joint account advantages
If you live with a partner, opening a joint current account that can be used to cover household bills and other shared expenses can make life much more straightforward.
If both of you pay in a set amount – say between 10% and 40% of your salaries – each month, an account of this kind can also help to prevent arguments about money.
And in months where there is some cash left over you can decide together whether to use it to treat yourselves, keep it in the account for tougher times or transfer it into a savings account.
While there is always the risk of one person going on a spending spree with the cash both of you have paid into a joint current account, the fact that only a percentage of your income is directed into the account gives you a measure of protection.
For anyone concerned about privacy, this also means that only the spending from the joint account can be seen.
When it comes to savings, the main advantage of having a joint account is that you can both add to it at any time, meaning that the balance is likely to grow faster.
The Financial Services Compensation Scheme protection limit of £85,000 for savers is also unaffected by having a joint account as the limit is per individual saver, rather than per account.
Having a joint savings account is therefore very useful when it comes to saving up for big purchases such as an expensive holiday for two, or a new kitchen.
The same – in reverse – is true of loans, mortgages and other credit agreements: Two people, with two incomes, can borrow more than one person alone.
This is why young couples find it so much easier to get a foot on the housing ladder than singletons.
Joint account disadvantages
As mentioned above, one of the main problems with opening a joint account of any kind with a partner is that you are – to a greater or lesser extent – giving him or her access to your money.
If your partner turns out to be unreliable, or the relationship turns sour, you could therefore end up losing out to someone you thought you could trust.
Should your partner decide to withdraw funds from a joint savings account holding a significant amount, it could prove very difficult, if not impossible, to get your share back.
Meanwhile, when it comes to credit arrangements, remember that you are jointly liable with your partner for any borrowing done as a couple.
Should he or she become unable or unwilling to meet the payments, the entire responsibility not to default will fall on you, while any black marks resulting from an inability to pay will also affect both of you.
If you are opening a joint current account to pay bills and other shared expenses, a current account offering high credit interest could be a good choice.
The TSB Classic Plus Account, for example, pays 5.00% AER (variable) on balances of up to £1,500.
You must pay in £500 or more a month and register for online banking, paperless statements and paperless correspondence. You’ll need to log in to your account at least once every 12 months.
Alternatively, Santander's 123 current account pays 1.50 AER (variable) on balances up to £20,000.
Plus you will earn cashback of between 1% and 3% on some of your household bills.
To qualify, you'll need to pay in £500 or more a month, and have at least two direct debits on the account. There is also a £5 monthly fee.
For joint savings, meanwhile, one of the top easy access accounts is the Post Office Online Saver Issue 34 which pays 1.45% AER (variable) on balances of £1 or more. The rate includes a bonus of 1.19% gross fixed for the first 12 months.
After this, the rate reverts to 0.25% AER (variable) so it’s a good idea to move your money to a more competitive account at this point.
Please note: Any rates or deals mentioned in this article were available at the time of writing. Click on a highlighted product and apply direct.