Students can use joint bank accounts as a way to manage their bills. While opening a joint bank account will require a lot of trust between account holders, it can offer some financial stability as everyone contributes towards bills.

In this guide

What is a joint bank account?

A joint bank account is where two or more people are able to access the money in a bank account. These accounts are just regular bank accounts. Join account holders can all pay into the account to cover expenses like bills, write cheques or withdraw cash.

Can you open a joint account without being married?

Yes. You don’t need to be married, in a long-term relationship or even living at the same address to open a joint account.

If you already know the people you will be living with, it might be worth setting up a joint account beforehand so you can get bills organised ASAP.

Can you have more than 2 people?

Yes, it is possible but not that common. Some banks will only offer 2 account holder positions, some will go as many as four. The more account holders to a joint account, the more you’re risking your finances and credit rating.

What are the pros and cons of a joint account?

Choosing to pay your bills via a joint account offers a number of pros and cons. In this section, we’ll take a look at the key points.

Pros

Shared responsibility

With everyone in control of the accounts, you share the workload of organising bills and finances, so a single person isn’t left with the responsibility. It also means you can all keep up to date with your joint financial situation.

Organisation

You can make regular payments into your joint account relatively easily. This saves the effort of transferring money to and from your housemates every month.

Save some arguments

With a number of bills and several housemates, things can get complicated. Friendships can break down when money is involved and people start to feel cheated and confused. A single account for bills makes things much easier.

Cons

Shared responsibility

Shared responsibility is only a benefit when all housemates take on the duty of managing the account. If payments start lagging behind because someone hasn’t paid into the account, you’ll all be held responsible.

Poor credit

An often-overlooked aspect of joint bank accounts is that all account holders will be co-scored. This means that if one of your housemates has a poor credit history, it will affect your own credit rating the moment you open up a joint account with them.

This co-scoring will stay on your credit record for six years, even if you’ve closed the joint account.

Paying someone else’s debt

Because of the shared responsibility of the bank account, if the account becomes overdrawn, every account holder is responsible for paying the money owed. This means you could have to pay someone else’s debt.

What do you need to set up a joint bank account?

You will all need a few items in order for the bank to open a joint account for you. The required things varies from bank to bank, so it’s worth checking with your chosen one.

You will need:

  1. Proof of ID – this can be a passport or photo ID driving license.
  2. Proof of address – This can be a bank statement or utility bill which has been issued within the last three months.
  3. A good credit rating – This is to minimise any risk for the bank when opening an account for you.

How to open a joint bank account

Opening a joint account is similar to opening a normal current account. Each account holder needs to fill in their section of the application form and provide the evidence mentioned above.

You will want clarification on the following points, as they may vary from bank to bank:

  • Who can take money out without getting permission? – It might be worth electing a responsible housemate.
  • How will overdrafts be handled? – Usually every account holder is responsible for paying all the money owed. Issues may arise if someone also has a current account with the bank. They may find the bank takes money from their current account in order to cover the costs of missed payments on the joint account
  • How best to handle disagreements amongst account holders?

Can I open a joint account without the other people present?

Every account holder will need to sign documents and present evidence in order to open a joint bank account. Some banks may give you an extra day so the other person(s) can sign etc. – discuss with your bank of choice beforehand.

Can I remove someone from a joint bank account?

Yes. Say, for example, one of your housemates is moving out, you should be able to remove them as an account holder. Your bank will need signed permission from everyone on the account in order to remove someone. Banks may also ask for identification documents or to visit them in-branch as well.

Can I get an overdraft for a joint account?

Yes, you can apply for an overdraft on a joint account. However, be aware that the other account holders will be able to use it. This is another reason why you must only open joint accounts with people you trust.

How to close a joint account?

All account holders will need to agree to close a joint bank account. This is normally done in writing, but some banks may require you to come in-branch. You will need ensure all debts/overdrafts and direct debits are organised as you will not be able to close without them.

What to do if there are disagreements with other account holders?

If you’re having problems with the other account holders, the most sensible thing to do is cancel the mandate on the account.

This freezes the account, meaning no-one can make any cash withdrawals until you’ve settled the dispute. The account will only unfreeze once everyone agrees on how to split the money.

Worst-case scenario, the courts may have to get involved, but until then at least your money will be safe.

Should I get a joint bank account?

You should think long and hard about whether a joint bank account is worth it for you. You must trust your housemates to pay their dues, keep the money safe and stay calm during any future disagreements. You will also need to ensure your housemates have a good credit rating that is unlikely to change (we’re not all sensible with our student loans!).

Basically, if you have any doubts about sharing an account with your housemates, it’s probably best to avoid it.

The easier way – Split The Bills

Organising a method of paying bills that works for everyone can be stressful. Besides, you’ve got better things to do than chase your housemates to pay for their share of Netflix!

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