I’M suspicious of opening up a joint bank account with my husband and it’s not because I don’t trust him.
There’s a good reason why I want to keep our money separate – and it’s based on the horror stories I’ve heard in the past.
Deputy editor Lucy Andrews explains the reason why she will never open a joint account[/caption]
Opening a joint bank account is something you shouldn’t do lightly – talk to your partner about their credit history first[/caption]
A joint bank account is an account that is designed for two or more people.
They can be used by housemates in shared households to split bills, but usually, couples use them.
Each person has equal rights and access to the money in the account.
These accounts are becoming less common.
Just one in eight couples share all their spending and finances in a joint bank account, according to a survey of over 1,000 people by TSB.
That’s compared to two in five couples who choose to keep their finances completely separate.
Don’t get me wrong – joint accounts can be a great way of managing money.
It’s a great way of being transparent about your finances. This is really important – especially if you share financial responsibilities, like paying for rent, a mortgage, or childcare.
They can also help you keep track of who is paying for what, which means paying bills becomes fairer.
But for me, the downsides are much greater – which is why I will NEVER open one.
The risks
Opening up an account with another person means there is now a financial link between you both.
What this means is that if you choose to apply for credit – such as a loan, a mortgage, or even a mobile phone contract – the lender may look at your partner’s credit history as well as yours.
If your partner has a poor financial history, that could mean your application may get rejected.
That’s why it’s really important to sit down with your partner and have a frank conversation about the state of each other’s finances.
If you or your partner don’t know what your credit history looks like, there are ways to get this report for free.
Contact the following Credit Reference Agencies and ask for a copy of your report:
- TransUnion
- Equifax
- Experian
- Crediva
Take into account your partner’s spending habits.
If your partner is bad with money and overspends on the account, you are jointly responsible for the debt they have incurred from going into the overdraft.
You are also responsible for paying off any fees from running into the account’s overdraft.
How to break a financial link
IF the relationship ends and you need to close a joint bank account, you’ll need to break the financial link too.
Speak to your bank to close your joint account.
Usually, you can only do so if the account balance is zero – so sit down with your ex to discuss how to split your money fairly.
Closing the account won’t break the link.
You’ll need to contact three credit reference agencies and ask them to issue a “notice of disassociation”.
This means that the link is broken, and anything your ex does in the future with their money won’t be linked to you.
This is important – otherwise this could affect your ability to apply for credit.
The three credit reference agencies are: Equifax; Experian; and TransUnion.
Your ex could walk away with YOUR money
The biggest downside of a joint bank account for me is that there can be huge consequences if your relationship turns sour.
Joint accounts can be weaponised by your partner if you are in an financially abusive relationship.
Financial abuse is where someone else is controlling how you spend and access your money.
Victims may feel like their spending is under constant surveillance.
If you feel like your money in the account is being restricted, you can’t use it without permission, or you are being questioned over your spending, these are classic signs of financial abuse.
Let me be clear – I’m very lucky to have a lovely husband and we have a wonderful relationship.
But ending up in this position is more common than you might think.
As many as 4.1million women could have experienced economic abuse from a former or current partner recently, according to the women’s charity Surviving Economic Abuse.
The stories I have heard – mostly from women – about their joint account nightmares are enough to put anyone off opening these accounts.
I spoke to one lady whose ex pressured her into saving her money into their joint bank account.
When they went through a divorce, he drained every penny of the £7,000 that was in their joint account – despite only putting in £3,000 himself.
Another women who was splitting from her partner was astonished when her ex raided the joint account to travel the world.
While another lady dreaded the food shop because her card would frequently be declined at the checkout due to her partner overspending.
If you’re worried about your joint bank account, you can ask your bank to freeze it.
This will prevent your partner from withdrawing all the money.
If you do have a joint bank account, it’s really important that you still keep a bank account of your own so you are financially independent.
How we manage our money
Me and my husband are happily married, and while there’s absolutely no worries about financial abuse we have decided to keep our finances separate.
We’re not alone in this decision. Some 56% of people say they would never open one, according to a survey of 2,000 people last year by Be Clever With Your Cash.
We manage our money in different ways, without signing up to a joint bank account.
We are renters, and have a bills-included deal, which means we pay one big lump-sum to our landlord every month to cover rent, broadband, water and council tax.
I’ve set up a direct debit so that our bills come solely out of my bank account.
Then, the day before, my husband transfers me half of the money.
Of course, there’s a risk that I could be left on the hook for the entire bill if we split, because I have taken responsibility to pay the landlord directly.
But there’s no risk of us parting ways happening anytime soon!
We have our own subscriptions for streaming services that we share. I pay £12.99 a month for Netflix, while he pays £8.99 for Amazon Prime, which we mostly use to watch films and TV series.
When it comes to food shopping, we take it in turns to pick up groceries and pay for the shopping, or split it in half at the checkout.
When we go out for dinner, we go dutch, and we take it in turns to do rounds at the pub.
We save independently as well. I split my money up in three different ways: I put £100 a month into Premium Bonds, £200 into my Help to Buy Isa, and I also put £25 a month into a Stocks and Shares Isa.
Most importantly, we make sure we have open and honest conversations about money.
Getting help for issues with joint accounts
IF you’re worried about your partner’s use of a joint bank account, there are places to go for help.
Speak to your bank and explain what the problem is. It can take action, from freezing the account to helping you close it.
Most will have a specialist team to help you.
Charities are there to help if you are the victim of financial abuse.
National Domestic Abuse Helpline, run by Refuge, has a 24/7 phone line you can call for support (0808 2000 247).
