Sharing a meal is one thing. Sharing finances is another thing altogether. If you’re thinking about opening a joint savings account with someone, you know there are practical considerations—both legal and emotional—to mull over before you sign up. Here are a few things to consider:

Joint savings accounts can make money management easier

Any of the owners of a joint savings account can view balances, contribute money, or withdraw funds—all of which can streamline your financial life. So it makes sense that many married couples use joint accounts to save for a down payment on a home, a vacation, major purchases, debt management, or another major purchase. Joint accounts can also help manage debt, bill payments, and other shared expenses. As an added benefit, a joint account can facilitate open communication and accountability when it comes to your savings and spending practices.

Joint savings accounts aren’t just for spouses

Of course, married couples aren’t the only ones who enjoy the convenience of a joint savings account. There are a variety of circumstances where sharing responsibility and access to funds can be helpful. For example, adult children may find it easier to manage an ailing parent’s finances if they share ownership in a joint account.

In any case, remember that all the owners of a joint savings account have full access to all the money in the account. In other words, all the account owners can withdraw funds or close the account without consulting you. So only open a joint account with someone you trust and establish clear guidelines for its use.

Joint savings accounts need ground rules

It’s a good idea to establish some clear ground rules for the joint account to prevent unpleasant surprises for any of the account owners. For example:

  • Agree up front on what the money is going to be used for—perhaps a trip together, an anniversary gift, a down payment on vacation property or something else. Regardless, the clearer you make the goal, the better.
  • Determine how much each person will contribute and how/if the money may be used in case of financial emergency. Unexpected expenses are a fact of life. Before they happen, know what’s expected of each person in this savings endeavor.
  • Communicate with one another before doing anything with the money. You never want to assume the other person knows the specific timing of a withdrawal.

Whatever guidelines you decide on, having an open and honest dialogue about the account up front can help you avoid or resolve potential problems later.

Joint savings accounts help you maximize FDIC coverage

One of the biggest advantages of a joint savings account is that it helps you maximize your FDIC insurance coverage at FDIC-member banks. With a combination of accounts, you can insure more money than a single depositor at a single bank. In other words, saving together may mean saving more. Visit the FDIC’s EDIE (Electronic Deposit Insurance Estimator) to learn more about maximizing your FDIC insurance coverage.

Joint savings accounts can be opened online

You can open a joint savings account online with just a few clicks and some personal information from each account holder. Moreover, with an online savings account, you and the other owner(s) can bank at your own convenience. That means you can check your balance, transfer money, and more—from anywhere you have internet access. In addition, online banks often have lower overhead costs than traditional brick-and-mortar banks, so they can pass that savings on to you in the form of better rates.

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