Joint bank accounts are a useful tool, whether you open one to help manage shared bills with flatmates or you sign up with a spouse as a way of merging your finances.
The chances are you are going to be depositing a decent chunk of cash into the account each month to cover a mortgage, rent or bills.
This makes it well worth finding an account with added perks, such as cashback incredit interest and supermarket rewards. Here’s our top picks.
Shared finances: We have picked out the best current accounts for joint finances
Before you get drawn in by any of the offers out there think carefully about what you will use it for and keep the answers in mind as you read on.
- How much money will you deposit each month?
- What bills will you pay from the account?
- Will you keep a balance in the account?
- Do you already have insurance cover elsewhere?
Joint finances: What you need to know first
Could it affect your credit score?
Opening a joint account will create an association between you and the other person’s finances, which other lenders and banks are able to see on your credit history.
If you share an account with someone with a weak credit history it won’t directly impact your score, but it can make it more difficult for you to be accepted for financial products in the future.
This is because the association allows lenders to view the files of those you are linked with, when they consider your application. If they believe their circumstances could affect your ability to pay, they are more likely to reject you.
Make sure you review your score regularly and always close any jointly-held accounts you no longer use.
You are jointly liable for any debt
Aside from just the impact on your credit rating you also need to remember that both of you will be jointly responsible for any debt on the account.
However, contrary to what you may think, that doesn’t mean it gets split down the middle.
Banks can pursue either one of you for 100 per cent of the amount owed.
What if you fall out or break up?
Of course you should only open an account with someone you really trust.
But if you and your partner or flatmate do have a dispute you should make sure to tell the bank, so they make a note on your file.
The bank may be able to freeze the account or put checks on it that require that you both sign if either of you tries to withdraw a large amount of cash or close the account.
Savings boost: Couple can double up in in credit interest accounts to get an inflation beating savings rate on a bigger balance
Best for interest on your balance
If you are both paying all of your income into a joint account, or you are sweeping a large proportion of it in, an account paying interest on any balance could be worth considering.
Despite some major changes to the flagship 123 Account over the years, Santander could still be a good bet for couples as it offers both cashback on household bills and interest on your balance.
You get 1.5 per cent on up to £20,000 – 0.2 per cent more than the top easy access rate in our independent best buy tables.
How will earnings be taxed?
Remember earnings from an interest-paying current account fall under the personal savings allowance.
Any interest in a joint account will be shared between you equally and subtracted from your individual PSA automatically, even if you are in different tax brackets.
Higher rate payers are allowed to earn £500 in interest before tax is applied and lower rate earners are offered £1,000.
That said, if the Bank of England raises rates pushing up savings interest and Santander doesn’t hike the interest rate it may not be quite as competitive any more.
You get tiered cashback of:
- 1 per cent on water and council tax bills plus and Santander mortgages
- 2 per cent on electricity and gas bills and Santander home insurance
- 3 per cent from spending on mobile, home phone, broadband and paid-for TV packages.
Check you suppliers are eligible first though and make sure to use the cashback calculator to ensure earnings from the account exceed the £5 monthly fee.
To be eligible for the perks you will need to deposit £500 into the account and have at least two direct debits. The bank allows one joint account and one personal account per customer.
If you are likely to remember to up and switch again, you could consider the FlexDirect account from Nationwide too.
It pays 5 per cent back on £2,500, that’s worth £125 in a year (you would have to keep £12,500 in the Santander account to earn that discounting cashback earnings).
It also offers a fee-free overdraft for a year. After that the overdraft costs 50p per day beyond a £10 free buffer, borrow outside of an agreed overdraft and you can pay as much as £5 per day though so watch out.
The account requires a £1,000 minimum deposit each month but no direct debits.
|Account||Perks||Maximum interest||Maximum no. of accounts
||1.5 % on up to £20,000 (Up to 3 per cent cashback on bills)||£238||3||£5 monthly fee, £500 deposit, 2 direct debits|
|Nationwide FlexDirect||5% on up to £2,500, fee-free overdraft (first year only)||£125||3||Pay in £1,000 a month|
|Tesco Bank Current Account||3% on up to £3,000 (fixed until 2019) Clubcard points for spending||£90||3||£750 monthly deposit and maintain 3 direct debits|
|Club Lloyds||1.5% interest on up to £5,00 (2% until July)||£75||3||£3 monthly fee or deposit £1,500 a month, 2 direct debits.|
|Classic Account with Vantage||1.5% interest on up to £5,000 (2% until July)||£75||6||£1,500 a month deposit, 2 direct debits. Branches in Scotland only, but Halifax branches support most day-to-day banking needs.|
|TSB Classic Plus||5% on up to £1,500, £10 cashback per month until December 2018.||£75||3||Pay in £500 a month, 2 direct debits.|
Top trick to boost your earnings
It is also possible to double up on interest even if you already have an interest-paying account.
Remember while banks usually only allow one high-interest account per customer, some also allow you to open a separate joint account meaning couples can double up on interest.
You will need to fulfill any direct debit requirements but with some clever standing orders you can usually cycle your wage through the accounts to fulfill any deposit requirements to boost interest earnings considerably.
For example – couples with a Nationwide FlexDirect account each and a joint account could earn £375 on savings of £7,500 in a year compared to £99 from an easy-access account paying the top rate of 1.32 per cent.
Extra perks: Packaged accounts should be approached with extra caution, but most offer insurance cover, including on travel
Best for packaged accounts
A packaged account offers a bundle of perks for one monthly fee, typically including insurance cover. They should be approached with caution as the benefits can often come with restrictions that mean that not everyone will be automatically covered.
However if you would buy the insurance yourself anyway, these can save you a bundle compared to paying separately.
And joint account holders get double the benefits for the same price, compared to someone opening one as a sole account.
This is Money’s top pick is the Nationwide Flex Plus account, costing £13 per month.
For that you get worldwide family travel insurance to anyone up to the age of 74. This includes winter sports, golf, wedding and business.
You can claim for any children (up to the age of 18, or 22 if they are in full-time education). You can currently claim four times a year and the excess is £50.
It also includes UK and European breakdown and recovery assistance with unlimited call-outs, no excess on claims and cover at home, on the road and in someone else’s car.
Balances up to £2,500 in the account also benefit from incredit interest at 3 per cent.
When you are abroad you also get commission-free cash withdrawals.
Family mobile insurance is included in the package, it covers you if your mobile is lost, stolen, damaged or faulty – but remember this may already be provided as standard on your home contents insurance.
You get a £250 fee-free arranged overdraft after that borrowing quite expensive to watch out. It costs 50p per day for arranged amounts and up to £5 per day on unarranged amounts. All fees are waived for three months though.
Check out or Five of the Best Package Accounts guide for more info on the top paid-for account deals.
Money back on bills
There are a few accounts that now offer a percentage back on your household bills.
As mentioned above Santander’s 123 deal offers the latter but This is Money’s current favourite is the Natwest Reward Account.
It pays £100 in cash to switch if you open an account before June 15 and is currently offering fee-free overseas spending until August 31.
Customers also earn 2 per cent back on council tax, water, gas, electricity, mobile, landline TV package and broadband and an extra one per cent back at partner retailers.
According to the bank £345 of spending across household bills (the average household amount) earns £83 in cashback or £59 after the £2 monthly fee.
That’s £159 if you include the £100 reward for switching.
The Reward Account requires a £1,500 monthly minimum deposit and for you to access online or mobile Banking once every three months.
It comes with hefty borrowing penalties. You pay £6 per month to use an arranged overdraft and 19.89 per cent interest on the amount. Unarranged amounts costs as much as £8 per day.
Clubcard: Joint spending offers greater opportunity to clock up rewards points
Shared spending often means the weekly shop so an account with a rewards scheme attached could be a good option, particularly for families.
Tesco has long offered the most lucrative loyalty scheme and it’s one of the largest of the supermarket giants.
Tesco Bank’s current account pays 3 per cent interest on balances of up to £3,000 (worth £88 a year) and added opportunities for Tesco shoppers to earn Clubcard points.
Swiping your debit card earns you both standard loyalty points and an extra boosted rate getting you 2 points per £1 spent in stores or on petrol, and one point per £8 spent anywhere else.
A £1,000 per month spend including £250 spent in Tesco could be worth up to £70 off your shopping.
Agreed borrowing incurs interest of 18.9 per cent AER whether its an agreed or unagreed overdraft.
Best of the rest
There are a handful of accounts that bung you extra cash just for operating your account normally (usually making direct debits) or even cash hand outs for signing up.
The highest value perk currently comes from M&S Bank which offers £185 over the course of a year thanks to a £125 switching giftcard and a £5 monthly top up.
Other perks of the account include a £100 fee-free overdraft and M&S reward points for spending. You get one point per £1 spent on the card in stores.
Its overdraft charges are relatively low at 15.9 AER per cent with no monthly fees or charges for unauthorised borrowing.
The account requires a £1,000 monthly deposit and two direct debits.
First Direct’s First Account is a top pick because of its highly-rated customer service.
But it also has the benefit of a tempting switching carrot currently. It you move to the bank it offers either free tech (including Bose speakers or a Fitbit fitness watch), £150 in Expedia vouchers or a BlueMountain online course.
First Direct also offers the largest interest-free overdraft on the market at £250. Amounts higher than that cost 15.9 per cent EAR.
Watch out for unauthorised borrowing though as this comes with eye-watering fees of £5 per day (capped at £80 per month).
The best alternative for those who prefer cold hard cash is Barclays thanks to its current double-up promotion or Blue Rewards.
The feature costs £3 per month, but you get the following back:
- £7 per month for maintaining two direct debits
- £5 for a Barclays mortgage
- £3 for Barclays home insurance
- £1 for a Barclays personal loan
These are all doubled in the first year though and offer up to £384. The bank’s insurance and loans are likely not the best deals out there though even for the boosted cashback.
But if you fulfill just the minimum direct debit requirement you could still earn £132 for the account in a year after fees.
Watch out for the overdraft fees though. There is a £15 buffer, after that anything below £1,000 cost 75p per day, up to £2,000 costs £1.50 per day and anything beyond that costs £3 per day.
>You can read more about these accounts in depth in our top current accounts round up here.
THIS IS MONEY’S FIVE OF THE BEST CURRENT ACCOUNTS