Joint Account Must Knows

This post was written by the former Estonian Credit Union, now Northern Birch Credit Union.

What is a joint bank account? 

Joint accounts are bank accounts in which two or more people have ownership rights over the same account. These rights include the right for all account holders to deposit, withdraw, or deal with the funds in the account, no matter who puts the money into the account.

Why set up a joint bank account? 

There are many reasons why someone may consider opening a joint account. For example, couples may set one up to pay household bills once they start living together. In other cases, joint accounts may be considered as an option for someone to get help from family members or friends to manage their finances. Another scenario may be that a parent and child set up a joint account, so the parent can keep an eye on their children’s habits and easily give them allowance money.

Joint accounts can be really beneficial when managing your finances and making a financial plan. But, before you make a decision to open that joint account, make sure you understand exactly how they work.

Risks of a Joint Account 

Control over the joint account

  • Unless you are able to state otherwise in your banking agreement, any person named on the joint account is able to withdraw money from the account at any time. They don’t need permission from you to do so, even if most or all of the funds in the account were deposited by you.

Relationship Breakdown

  • If the relationship between you and your joint account holder breaks down, you risk the money being withdrawn or that the account may not be handled in the way that you wished
  • If your joint account holder and their spouse separate or divorce, the money in the joint account could be claimed in the separation or divorce settlement.


  • It is difficult to hold a joint account holder legally accountable for taking money from the account that they weren’t supposed to.


  • You will share responsibility with your joint holder for all transactions made through the account
  • If one of the joint account holders has financial problems or declares bankruptcy, creditors could make claims on the money in the joint account.

Removing someone from a joint account

  • The financial institution may require both people named in the joint account to give approval to remove one of you from the account.

What to consider before setting up a joint bank account 

  • Discuss the risks and benefits of a joint account with people you trust.
  • Is the person you want to name as a joint account holder trustworthy?
  • How much control will you have over the money in your account? Discuss with your financial institution if there are ways to keep some control over withdrawals from the account. Have you considered setting up text alerts to be notified when there are withdrawals or other activity on the joint account?
  • What if something happens to one of the account holders?
  • Speak to someone at your financial institution or a lawyer to find out what happens if you or your joint account holder dies or lose mental capacity.
Information provided by:
The information contained in this article was obtained from sources believed to be reliable; however, we cannot gaurantee that it is accurate or complete. This article is provided as a a general source of information and should not be considered personal advice.

Author: NorthernBirchCU

A co-operative financial institution based out of Toronto, Ontario.

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