Is a joint savings account a good idea?

A joint savings account can be a good way to build up money for shared financial goals like holidays or a house deposit. We weigh up the pros and cons.

A joint savings account is different to a joint current account, which many couples use to split shared costs like household bills and mortgage repayments. Find out if getting a joint savings account could help you reach your financial goals.

In this article we explain:

• What are the pros and cons of joint savings accounts?
• How do I open a joint savings account?
• What happens to your money if the relationship goes wrong?
• Financial abuse: the warning signs

Read more: How do joint bank accounts work?

What is a joint savings account?

Joint savings accounts work in the same way as individual ones, except that two or more people can pay into them and withdraw the money. You do not necessarily have to be:

• Married or in a civil partnership
• Live at the same address as the other account holders

Each joint account holder should be able to see the transactions on the account, deposit and withdraw money from it, and set up standing orders and direct debits.

Read our top pick of best savings accounts 2023.

What are the pros and cons of a joint savings account?

There are both advantages and disadvantages of joint accounts.

The pros

Joint savings can be really useful in some circumstances, especially if you are wanting to save towards a shared financial goal such as a house deposit or a large specific purchase, such as a new kitchen.

In can also be beneficial where one member of a couple is not currently earning, perhaps due to childcare responsibilities, but where both joint account holders should have access to withdraw money.

Here are some of the benefits:

• The balance could grow faster with two people
• Both can see the progress towards that goal, which may motivate you to save more
• Some savings accounts may pay higher interest where there are higher balances
• A joint savings account can help to ensure that you earmark money for a specific purpose such as shared expenses

If you are looking for inspiration to get into the savings habit, check out our 10 money-saving challenges

Savings accounts do not count towards your credit score history, unlike current accounts and credit cards. If you and your partner take out a joint credit card or other types of debt and then fail to pay it off then it could affect both of your credit scores.

Find out more: Will my partner get a share of the house I own if we break up?

The cons

Although there are many reasons to consider joint savings such as easier money management, you should proceed with care as there are risks too.

Here are some of the downsides:

• Your partner or fellow account holder may have a different attitude towards money to yours, which could affect your relationship
• It’s likely that both joint account holders can withdraw money without prior agreement so there is nothing to stop one party taking out money and refusing to pay it back
• There is not a lot of privacy as your partner will be able to see what you are buying with any money withdrawn.
• It can be tricky to close the account without a partner’s permission

Who do I open a joint savings account?

Most people over 18 and with a permanent address in the UK can open a joint savings account.

Be aware, you could be excluded from certain accounts if you:

• Are unable to pass basic credit score and identity checks with a bank
• Don’t already hold a current account with the provider (some have this as a stipulation to open a joint account)

How to open a joint savings account

In order to open a joint account, you will need to take a number of steps, including the following:

• Provide proof of identity and proof of address, unless you both already hold an account with the bank where you are taking out the joint account
• Agree to a credit check from a new provider
• Fill in an application form
• Agree on and sign a “mandate”

A mandate will show what the rules are on who can withdraw money from the account, how to close the account if necessary, and who gets any interest from it.

This is important as it counts towards your tax-free personal savings allowance of up to £1,000 in savings interest.

Frequently Asked Questions

Can I have joint and personal savings accounts?

Yes, you can have a personal account and a joint savings account. You can also hold them with more than one provider.

What happens if one of the joint savings account holders dies?

You can hold a joint account as “joint tenants” or as “tenants in common”. What happens when one person named on the account dies, depends on how it is held.

• Joint tenants – if one person dies, the money automatically goes to the surviving holder(s) of the account. The death certificate will be enough for this transfer to take place.
• Tenants in common – by signing a declaration of trust, the deceased’s share becomes part of their estate to be distributed under the terms of a will

Some couples with a joint savings account could consider setting up powers of attorney. This is where one partner can make financial decisions for each other should injury, illness or old age stop them from making those choices themselves.

Can I have a joint savings account if I’m not married?

Yes – you can have a joint savings account with you’re partner without being married.

What can I do if things go wrong in the relationship?

If you and a partner fall out and you fear they will empty a joint bank account, you need to act quickly.

You can call the bank and ask them to freeze the account, although both joint account holders have to agree to unfreeze it.

If you have a direct debit going into your account, this might be a good time to stop it as well.

Usually, if you separate from a partner, the money in a joint account belongs to the person who paid it in, although if you are divorcing or have children, there may be other claims on it. You may need to use mediators or a divorce settlement in court in these cases.

If you are going through a divorce, find out more about what you might be entitled to in a financial settlement.

How can we close a joint savings account?

You can usually close an account by visiting a branch or filling in a form that is then signed by all account holders. If you have direct debits going into it, make sure you cancel these too. You may need proof of ID.

How is money protected in a joint savings account?

Your money is protected against the bank going bust by the Financial Services Compensation Scheme (FSCS).

The limit on this scheme is £85,000 per person protected per banking licence, so a couple’s joint account is protected up to £170,000 – as long as neither party has another account with the same bank.

What are the signs of financial abuse?

The darkest side of money and relationships is when it descends into financial abuse, a form of domestic violence. Having a joint financial product makes it easier for one person to control another person.

Financial abuse is defined as someone controlling another person’s access to money, financial resources or ability to earn money, in order to reduce their independence. 

Examples include preventing someone from accessing their own or joint account, forcing or coercing someone to add them to their bank account, putting debts in someone else’s name and stopping a partner from going to work. 

Read more: Joint and several liability: Tips for avoiding relationship debt

It can happen to anyone from any background. Spice Girl Melanie Brown told The Sunday Times in 2018 that her £80 million fortune had disappeared during her ten-year marriage to Stephen Belafonte. She claims he stopped her carrying a bank card.

Unlike physical abuse that is easy to identify, financial abuse can start slowly with seemingly reasonable requests for money or caring suggestions to deal with the finances and lead to a pattern of behaviours that is difficult to recognise.

The charity Surviving Economic Abuse has a list to help people spot the signs of economic abuse.

If it’s happening to you, or to someone you love, it can be difficult to accept. Organisations that can offer practical and emotional support include:

• The National Domestic Violence Helpline
• Surviving Economic Abuse
• Women’s Aid
• Men’s Advice Line and Men’s Advisory Project Northern Ireland
• National LGBT and Domestic Abuse

In January 2019 financial abuse was recognised for the first time in the Domestic Abuse Bill. When it is enacted, hopefully later this year, it will make financial abuse a crime.

Until then, financial abuse is effectively a form of coercive and controlling behaviour and falls under the 2015 legislation that covers this, so if you feel scared go to the police.

Financial abuse is also recognised by high street banks and building societies. Eighteen have signed up to the Financial Abuse Code of Practice. It requires them to train their staff to spot and assist people in need of help. 

Despite the code, survivors of abuse still report difficulties dealing with their banks and building societies when it comes to dealing with their accounts. Customers should expect to be referred to a specialist team when they approach their bank.

It is important to be aware that de-linking finances is a process, often a frustrating one, and in some cases takes years. It is therefore important to have emotional and practical support from a charity or domestic abuse organisation if not friends.

They will help if there is pushback or a poor response from financial providers. It is also advisable to keep a diary of incidents.

How to get help

If you suspect someone you care about is a victim of financial abuse you may be struggling with how to respond. Here are some suggestions:

• Be there for them. It may sound inadequate but checking in with them on a regular basis is important.
• Be careful what you say around their partner and also what you write in text messages or on WhatsApp – the abuser may be reading them. 
• Be clear with a friend that behaviour they describe is abuse. You could say “Are you aware that what you have told me could be deemed abuse?” or “It sounds like abuse”
• Tell them about sources of advice such as Surviving Economic Abuse resources
• Tell them they can talk to their bank
• Don’t say what to do – this could put a person in danger
• Don’t be judgemental

Get help finding your money

If you are getting divorced, and suspect your ex is hiding money, you could consider forensic accountancy.

Forensic accountants are not personal investigators. They don’t go through bins or do searches on databases. They look at bank statements and analyse mysterious transfers.

Roger Isaacs, a forensic accountant from the accountancy firm Milsted Langdon, says there are several questions to ask yourself before enlisting an expert.

First, where do you think money is coming from? Is your ex cashing in investments or savings? Doing jobs for cash? Or – a more recent trend – being paid for work in bitcoin?

Second, hiding money normally requires someone to collude with them – who do you think this is?

Take the answers to the above questions to your solicitor. They can then get the court to consider the information and agree for an accountant to be jointly appointed.

A jointly appointed forensic accountant holds more credibility – he or she is not a hired gun and has no axe to grind.

The cost is shared by both parties or paid by the wealthier party. Rates can start at £100 an hour where there is Legal Aid and go up to £1,000 an hour.