Advantages and disadvantages of a Joint Account PART3

How to pay with cheques

You may be happy to let just one of the account holders sign cheques, or you may prefer both of you to sign for every cheque or instruction to the bank. This is something you'll have to agree between yourselves before opening a joint account.

What happens if one of the account holders goes overdrawn?

Both you and your partner are fully liable for the whole of any balance that goes overdrawn. This means that if your partner goes overdrawn, you'll both be responsible.

My partner has been refused a bank account due to bad credit. Could we still open a joint account?

If your partner has been turned away from opening a bank account in the past because they've got a poor credit history, you may be able to find a joint bank account that will accept you regardless of their credit rating.

If you or your partner are an undischarged bankrupt, you may have to look for a joint account such as the thinkmoney joint Personal Account, which is open to undischarged bankrupts.

Your thinkmoney joint Personal Account application won't be affected by your credit rating, which means the account could be open to people who've been refused a bank account in the past due to their bad credit rating, or are currently bankrupt (or have been in the past).

If you would like more information on your credit rating, have a read of ourguide to Credit Ratings.

What happens if you break up?

If the relationship ends, you may well decide to close the joint account. If this is the case, you should both contact your bank and arrange for the account to be closed, and any Direct Debits or standing orders to be cancelled or rearranged as you wish.

If you've both signed a joint account mandate, bear in mind that if your partner continues to write out cheques, the bank will still be obliged to pay them (as long as they're backed up by a cheque guarantee card). Until you tell your bank to cancel the joint mandate, you will still be liable for the payments - which could have an adverse effect on your finances.

What happens if one of the account holders passes away?

If the worst happens to you or your partner, the account balance will automatically pass to the remaining joint account holder, who will then be solely responsible for managing the account.

Finally...

As you have seen, there are various advantages and disadvantages to a joint bank account. On the one hand, they can offer a convenient way for a couple to manage their monthly finances, as well as offering some flexibility when deciding who is responsible for what.

However, it's definitely worth remembering that with a joint account comes joint responsibility: for example, if your partner goes overdrawn, or the relationship breaks down, you'll both be responsible for how you sort your joint finances out.

Just like any successful relationship, a joint bank account requires serious commitment - and what's more, opening one with your partner could even mark the start of a whole new relationship with your finances.