Do we need a joint account?

Emmia

AdmanPea said:

Hi all. My partner and I (getting married later this year) lived together and she recently got added to the mortgage as a full partner post a remortgage with our lender.

My question is, for her own credit purposes, would it be best to have a joint account for bills that we pay for everything for? I earn a fair bit more than her and we currently have it so I pay for all the bills (as I always have) but she direct debits me an amount each month that contributes. 

I think she's nervous that all of her financial independence has now gone (in theory) and didn't know if it was beneficial to be a joint-name on an account that covered such things just in case anything happens to me etc...

Thoughts?

This isn't about your question really, but do you have life insurance that pays off the mortgage in the event of either of your deaths (and  being unable to work), and (this is especially important before you marry) do you have wills in place should anything happen? Currently your partner wouldn't get anything in the event of your death automatically (or vice versa) aside from what may be in any joint account.

If you don't have wills, I'd get that sorted (professionally, with a solicitor, not one of those WH Smith will writing kits) but ensure they are drafted in contemplation of marriage so they don't become invalidated when you do marry.

sausage_time

Every relationship is different but we have this "hierarchy" of accounts:

• One "main" joint current account where all bills are paid and credits are received. 
• Several credit cards in each of our names with additional cards for the other.  All paid in full from the main account above.
• Separate savings accounts for ease of tax liability tracking.  Conceptually it's all "our" money and we regularly shuffle funds around to pay bills etc and chase better interest rates.
• ISAs (cash and S&S) in our own names (because that's how they are).  Again, all seen as "ours".
• Pensions in our own names (because that's how they are) but full transparency for our retirement tracking.
• I have a few separate current accounts with residual balances primarily to take advantage of attached savings and regular savings accounts. 

Works for us!

CliveOfIndia

If the mortgage is in both your names then you're already "financially associated" - meaning one person's credit record can affect the other's.

In terms of a joint account, it'll make little difference from a credit point of view since you already have the financial association.  It can make the boring day-to-day financial admin simpler, and does work for a lot of people - even if you just both contribute an agreed amount to cover the essentials and have a separate pot for your own "fun" money.

Some people just have a joint account and that's it - everything gets paid into that, all the bills come out of that, and what's left is viewed as joint money, irrespective of who earns the most.

It's whatever works best for you, really.  You don't "need" a joint account, but if it makes life simpler for your particular circumstances then you may as well get one.

Rob5342

As mentioned you'll be financially linked anyway with the mortgage so having a joint account won't make any difference from a credit point of view.

From a practical point of view a joint account can be very useful, if something happens to one of you then the other can keep using it, and for joint expenses it can be easier to pay from one place than keeping track of who owes what all the time. You just need to see what works for you and change things whenever you think it's not working. We take the all in one approach and that works for us. Most of our spending is on joint things anyway, as long as we can each buy things for ourselves sometimes we are happy and don't keep track of who has spent what.

ZeroSum

Rich1976 said:

We used to have a joint account for the household bills and separate accounts for anything else but a few years ago decided to go all in so everything now is in joint names.

it was a game changer for us because it’s easier to see everything coming out in one place and no quarrels about who owes who for what or person A is running low on funds so person B has to sub them until pay day.

our savings are in both our names too and it makes it easy now to save up for shared or individual things such as holidays, home improvements as well as the annual bills, both individual and shared.

We just have one spreadsheet for budgeting and both our incomes are combined into one household income. When you are married there’s no mine and yours money but it is our money and has led to far fewer disagreements the way we do it now.

Each couple is different and you will find which way is preferable to you .

Not utilising ISAs then? Since they can't be opened jointly. You can still pretty much do as you do but still have your own accounts with an agreed amount of fun money for each (which is usually the wasteful spending that causes arguments, so think it's better to have that separate)

Rich1976

ZeroSum said:

Rich1976 said:

We used to have a joint account for the household bills and separate accounts for anything else but a few years ago decided to go all in so everything now is in joint names.

it was a game changer for us because it’s easier to see everything coming out in one place and no quarrels about who owes who for what or person A is running low on funds so person B has to sub them until pay day.

our savings are in both our names too and it makes it easy now to save up for shared or individual things such as holidays, home improvements as well as the annual bills, both individual and shared.

We just have one spreadsheet for budgeting and both our incomes are combined into one household income. When you are married there’s no mine and yours money but it is our money and has led to far fewer disagreements the way we do it now.

Each couple is different and you will find which way is preferable to you .

Not utilising ISAs then? Since they can't be opened jointly. You can still pretty much do as you do but still have your own accounts with an agreed amount of fun money for each (which is usually the wasteful spending that causes arguments, so think it's better to have that separate)

Agreed. We need to look at Isa’s again.

jamesyboy7471

I note that in the event of having a joint bank account you are both entitled to the £1000 tax free allowance on any interest gained- a total of £2000 in any tax year.

Is it the "feeder account",ie the account you took the money from to invest that is considered the  joint one, or does the investment that you are receiving the interest from had to have been taken in joint names,making it the joint one ?

surreysaver

Emmia said:

AdmanPea said:

Hi all. My partner and I (getting married later this year) lived together and she recently got added to the mortgage as a full partner post a remortgage with our lender.

My question is, for her own credit purposes, would it be best to have a joint account for bills that we pay for everything for? I earn a fair bit more than her and we currently have it so I pay for all the bills (as I always have) but she direct debits me an amount each month that contributes. 

I think she's nervous that all of her financial independence has now gone (in theory) and didn't know if it was beneficial to be a joint-name on an account that covered such things just in case anything happens to me etc...

Thoughts?

If you don't have wills, I'd get that sorted (professionally, with a solicitor, not one of those WH Smith will writing kits) but ensure they are drafted in contemplation of marriage so they don't become invalidated when you do marry.

Marriage invalidates a will (I believe - which is why it should be done with a legal expert, rather than us non-experts on an internet forum)

Emmia

surreysaver said:

Emmia said:

AdmanPea said:

Hi all. My partner and I (getting married later this year) lived together and she recently got added to the mortgage as a full partner post a remortgage with our lender.

My question is, for her own credit purposes, would it be best to have a joint account for bills that we pay for everything for? I earn a fair bit more than her and we currently have it so I pay for all the bills (as I always have) but she direct debits me an amount each month that contributes. 

I think she's nervous that all of her financial independence has now gone (in theory) and didn't know if it was beneficial to be a joint-name on an account that covered such things just in case anything happens to me etc...

Thoughts?

If you don't have wills, I'd get that sorted (professionally, with a solicitor, not one of those WH Smith will writing kits) but ensure they are drafted in contemplation of marriage so they don't become invalidated when you do marry.

Marriage invalidates a will (I believe - which is why it should be done with a legal expert, rather than us non-experts on an internet forum)

This is why I mentioned "in contemplation of marriage"... As this allows a will to be drafted which will remain valid after that point.

But I would 100% agree with using a solicitor.