In general, a joint bank account is a bank account belonging fully and equally to two people.  Each person can legally deposit or withdraw any amount of money from the account without need for the other's consent.  Both names on the bank account "own" the entire account.  Most joint bank accounts have a right of survivorship, meaning that when one party dies, the contents of the account automatically are fully owned by the other party.

What are Some Different Types of Joint Bank Accounts?

People choose to use joint bank accounts for different reasons.  In some situations, there is an understanding between the parties involved that one or both of the parties can only withdraw a certain amount of the money, or can only withdraw money in certain circumstances.

There are several different types of joint bank accounts:

  • In a true joint tenancy, both parties have full and unrestricted access to the contents of the account.
  • In a convenience account, one person is the real owner of the funds, while the other person's name is on the account so that they can pay bills or make withdrawals for the owner of the funds.  This type of account is often used for elderly or incapacitated persons.
  • In a POD account, one person owns the funds in the account, and the other person will own the funds after the first person's death.

What are Some Dangers of Using a Joint Bank Account?

  • Abuse of authority - A person whose name is placed on an account simply for bill paying and conveinence purposes may abuse this power, and withdraw funds for their own means.
  • Creditors - If money is held in joint tenancy by two people, it can be subject to both people's creditors.
  • Unintended Survivorship - Even in a convenience account, if there is a right of survivorship, the assets in the account will go to the person on the account when you die.  Because a joint bank account is a non probate asset, this right of survivorship cannot be changed in your will.

Do I Need a Lawyer?

Joint ownership of assets can be complicated and have unintended results.  If you are looking to set up a joint bank account, you may want to consult an estate attorney.  An attorney near you can help you determine the best way to manage your assets, and can help you to understand how your assets will be dealt with in the event of your death.