Tip for Managing a Joint Account
Money is one of the major reasons that couples fight. Keeping track of your own spending is hard enough. When two people have access to a single account, the problems and challenges of keeping track of that money seem to multiply exponentially. Even when both people are organized, mistakes and errors can occur. Just ask anyone whose beloved has written a rather generous check to buy a gift for someone, but then forgets to write the amount down in the checkbook register. Later that week you write several checks to pay off that growing stack of bills thinking there's plenty of money in your joint account. When that overdraft notice comes in the mail a few days later, you see that big, fat bank penalty fee and explode. The fight is on. Here are some helpful tips for successfully maintaining a joint banking account.
Maintain a Master Bank Account Register
As with any successful relationship, communication is the key. Make an agreement with your partner that both will write down or record all ATM transactions, deposits, and check amounts in a single master register. This master register should be kept in a safe location that is easily accessible for both partners. Make a point to reconcile the account on a regular basis and keep it accurate. This way, both of you will know where you stand financially.
One of You May be Better with Numbers
Sometimes, one partner is just better at handling numbers and balancing the account. If you would rather watch ice melt rather than balance the register, and your partner is an accountant type who is a whiz with the numbers, then let them do the reconciling of accounts and keep track of the register. However, you still need to be aware of your overall financial situation, especially if you're not balancing the account.
Consider Electronic Banking
You haven't done this yet? Go to your computer and sign up right now for online access to your account. Leave yourself a reminder to check in occasionally and just take a look at the account. You can monitor all transactions from here, sometimes on a real-time, or close to real-time basis. Checking in regularly will help to catch any mistakes or miscommunications with your partner. If your partner forgets to tell you about an ATM withdrawal, or takes out money to cover gambling debts, you'll see it here.
Talk About any Big Purchases Beforehand
Big purchases can be defined as anything other than regular bills that are paid each month. These can also be defined as any purchase that exceeds a certain amount of money. Since money is one of the primary causes of stress and tension in a relationship, it only makes sense to make a plan for your money. Planning things together will also help your relationship in other areas as well.
Link Joint Checking Accounts to a Savings Account
Add an extra cushion and guard against accidental overdrafts by linking your joint account to a savings account. This way, if a partner makes an error or writes a large check, there will be a reserve of savings to cover the overage. Most banks offer free overdraft protection when linked to another account.
Consider Signatory Options
Two types of joint bank accounts are available. There is the joint account that requires both partners to sign. In this type of account, no transaction may occur unless both sign. When both signatures are required, there is less access but more security. The other type of joint bank account allows for either partner to sign and to make transactions without the consent or signature of the other. In this type of joint account, there is more access but less security.
Trust is one of the most valuable things in any relationship and trust in the other person is essential when it comes to a joint bank account. Keeping a joint bank account together works perfectly well if there are some clear ground rules set out from the start, if the account is carefully monitored, and if both partners talk to one another. With these tips in mind, a couple should have no problem managing a joint bank account.