Many people today opt for the creation of a joint account for better management of their expenses. This is a bank account held by at least two people. This may be a term deposit account, a securities account, a savings account or a current account. Very practical, the joint account makes it possible to differentiate personal funds from common expenses. Do you want to share a common account with someone you trust? Discover here 4 good reasons to open a joint account.
A better distribution of expenses with a joint account
As the name suggests, joint account is a bank account held by two or more people. It can be opened with a family member, friend or spouse. The joint account allows you to have a fair distribution of expenses. The co-holders are responsible for the transactions carried out on the account. However, each holder has the right to carry out banking operations without the consent of the other. Also note that you can easily open this type of account with an online bank.
As a joint account holder, you can deposit or withdraw money at any time without having to wait for authorization from the other member. The bank in which you open your joint account will offer you an international bank card for your various withdrawal or payment operations. Opening an account is free of charge and no time commitment. To finalize the opening of your joint account, an initial payment of between 10 and 300 euros must be made. In general, the holders of the joint account each have their own bank card. The user code remains secret and personal. The cards are therefore not interchangeable. Several services are associated with a collective account.
The Card usage limits vary from bank to bank. Some online banks set withdrawal limits at 400 euros per week and payment limits at 1,000 euros per month. However, you can set the level of withdrawals and payments to suit you. Withdrawals with visa cards are free of charge. Some banks provide you with emergency cards that can be used in the event of a problem with your usual bank card.
Joint accounts are used for common expenses such as rent or common outings. To have a better breakdown of your expenses, all you have to do is reach an agreement with your co-holder to deposit a given amount into your account. Funds may be used for accommodation costs, paying for groceries, traveling together, etc
Open a joint account: easier day-to-day management
Whether it’s a household or a simple roommate, budget management that relies on several accounts can very quickly become a real headache. The joint account then appears to be an ideal solution to manage the finances of the house more easily. In general, opening a joint account makes it possible to share expenses fairly. In a household, the purpose of a joint account is to centralize the budget.
In principle, the money allocated to it should be adapted to the working capital needs of your household. These include current expenses and various household fixed costs. Current expenses relate to the general running of the household. These include, among others, electricity bills, food shopping, internet subscriptions, etc. Fixed charges refer to the payment of rent or various insurances for example (home, car, etc.). They also concern taxes on household income, school fees, school canteen, etc.
The joint account can be used to pay exceptional expenses or to fund savings products. This account makes it easier to manage the budget together. Two options are available to cardholders. In a first case, the salary of each account holder can be paid directly into the joint account. Cardholders allocate a sum for personal use once the fixed charge expenses have been withdrawn.
In the second case, account holders keep an individual account. They will be able to transfer a sum of their income to a joint account every month to contribute to current and fixed household expenses. This allows you to have better management of your common budget on a daily basis. Budget tracking tools allow you to have a better distribution of expenses. The joint account offers the advantage of being able to easily share common expenses.
Save money by having fees on a single bank account
Opening a joint account is also an ideal way to save on bank charges which are now assigned to a single account instead of two different. If you want to reduce your annual bank fees as much as possible, opening a joint account is one of the best options.
For better management of their finances, some people prefer to close their individual account in order to manage all of their money in a joint account. This mode of management requires great trust between the two parties. However, this saves money since the couple does not multiply the accounts. Only the joint account is assigned to the couple. This allows you to have less costs.
Whether for the means of payment or for account management, the cost of services is less expensive compared to two individual accounts. What’s more, the authorized overdraft amount will be higher for a joint account. Online banks are more recommended to save bank fees no matter how you manage your finances. They are free and can greatly reduce costs. Visa cards allow you to make your withdrawals and payments abroad free of charge. You can withdraw money for free in almost 50 countries.
A joint bank account facilitates expenses in the event of a life change
The joint account can be very useful to facilitate your expenses in the event of a life change. For a sabbatical year as a couple, for example, this type of account can help you better manage common expenses. Opening an account in an online bank allows you to manage your money from anywhere in the world. It can also happen that a couple starts building a house while the current house also requires costs.
The joint account allows in this type of case to distribute your expenses in a rational way. You can close your account at any time by sending a letter to your bank. The letter must be signed by all the co-holders.
The associated services will be immediately terminated by the bank after the account is closed. The co-holders must decide together on the allocation of the balance of the account after it has been closed. You also have the option of canceling the products associated with your account, such as the visa card, by sending a written request to your bank by post.
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