Joint Bank Accounts
Joint bank accounts are checking accounts and saving accounts shared by two or more people. Each financial institution determines the number of people you are able to add to the new bank account. However, there are some cases when up to three people have been allowed on an account.
Couples that aren't legally allowed to be married, those who are legally married, and those who wish to share with a parent or friend can share these joint bank accounts. Joint savings and joint checking are the most commonly shared bank accounts.
At a bank, the cost to open a regular savings account and/or checking account can be as low as $50 and $5 for a minor. At a local or national credit union the cost to open a savings and/or checking account can be as low as $5 and $0 for a minor. Savings accounts are the most common for minors not checking.
Opening a new bank account require that all parties be available initially to sign the paperwork that will state the account terms. For example, the agreement will state whether a minimum balance will be required to remain in the account each month to avoid monthly fees. It should also state who can handle (both or either or) banking transaction such as withdraws, deposits, and account changes.
Joint bank accounts have advantages and disadvantages. Advantages include having only one account to balance, having more than one person helping with the money to open the account and keeping it open without fees because one may receive direct deposits.
Some disadvantages to banking accounts setup this way is that one person on the account may constantly cause overdraft fees (if you did not turn down this protection), or that person may not balance their portion of the funds and dip constantly into your money. If anger comes into play, the person may run with the money entirely.
Another scenario is if a creditor is trying to collect from someone who is listed on the account for non-payment, the creditor can seize the checking account. Getting your name off an account that has fees that have not been paid can prove difficult but if there are no past due fees and outstanding check or debit card purchases, you should have no problems being removed.
Bank Accounts After Death
What happens to joint bank accounts when someone, joint owner, dies? Many things can happen to a joint bank account. For example, funds that remain from the deceased person can remain in the account for others usage unless a legal issue such as a will surfaces that states the money goes elsewhere.
If no legal issue arise after several months (six months to a year), you can have the deceased person's name removed by carrying in a copy of the certificate of death. When things go well, joint banks accounts can be great but when things go wrong, friendships, marriages, and banking relationships can be ruined.
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