The decision of whether or not you use a joint share draft checking account is one that many married couples have to deal with. There is no absolute “right” answer to this question and, not surprisingly, there are plenty of arguments both for and against it. Whether this form of banking is in your best interest is a decision only you and your spouse can make, so here are some commonly experienced ups and downs to aid in the process.
The Pros of a Joint Share Draft Checking Account
Easier to Manage and Equal Information
A joint share draft checking account is a single pool into which you and your spouse deposit and from which you draw money. Keeping track of expenses and managing account activities is much simpler if you only have one account to worry about. There is never going to be a situation in which you or your spouse are uncertain about the other’s financial position, and budget tracking and adjustments can be made much more easily as well.
No Risk of Access Problems
Shared access is the key feature of a joint share draft checking account. This prevents situations in which access to funds can become impeded if you or your spouse becomes unavailable or incapacitated. This can be particularly important if one partner is responsible for key expenses like groceries or certain bills—separate accounts means they could, for example, end up hospitalized and their spouse would have no means of accessing necessary finances.
Share Investment in Common Financial Matters
Married couples have many common expenses, like bills, groceries, or even just a night out for a romantic dinner. Using a joint account for these matters means that both parties contribute to what they both benefit from.
A joint share draft checking account makes several banking activities easier to manage. In addition to lower banking fees and less paperwork to fill out, joint accounts can also sometimes earn better interest rates to boot!
The Cons of a Joint Share Draft Checking Account
The flipside to sharing everything is that you share everything. On one hand, this means you are more accountable to each other over spending habits. On the other, it can lead to conflict since people don’t like to be challenged on what are often well-set behaviors. A lesser effect of the lack of privacy is that it can complicate gift-giving. When your spouse checks their statement, it ruins the surprise if they see a charge you’d prefer stay hidden until the wrapping comes off.
Joint share draft checking accounts can raise tensions in a relationship if there is a discrepancy in the earning power and spending habits of each spouse. If one spouse has a higher income, they may become more hawkish in observing how money in the joint account is used. These difficulties can be worsened if both spouses don’t have the same habits regarding debt and repayment.
Ironically, a joint share draft checking account can sometimes create lopsided financial duties. In order to prevent incidents like duplicate check writing, accidentally paying the same bill more than once, and overdraft fees, one spouse tends to get put in charge of physically paying certain shared expenses.
What’s the Answer?
There is no single best practice for using a joint share draft checking account. However, there are two general trends in how couples tend to manage the arrangement.
You and your spouse use the joint account as you see fit with the caveat that any purchases over a predetermined amount need to be cleared with the other first. Such set-ups may also come with occasional sit-downs to go over the account activities and make sure everything is on budget.
Shared plus Separate
Under this scenario, you and your spouse continue to maintain separate bank accounts but establish a third account for joint use. Each of you contributes a set amount per month (a flat amount or a percentage of income) to the account, and this pool is drawn on to pay joint expenses and bills. Alternatively, this type of joint account use can also be employed to store money away for emergencies or for larger savings, like a vacation fund.
Use LUSO Federal Credit Union for Your Share Draft Checking Account Needs
LUSO Federal Credit Union is a not-for-profit, member-owned financial cooperative dedicated to providing members with quality financial services and products. We at LUSO pride ourselves on serving the financial needs of our members and helping them manage their joint or separate share draft checking accounts with reasonable interest rates. Our services are available in Ludlow, Springfield, Chicopee, Westfield, and Hampden County, Massachusetts.
Feel free to contact our Ludlow branch toll free at 1-844-LUSO-FCU or our Wilbraham branch at 1-800-808-5876.