“Deji and I are so excited about this chapter of our life! I love him so much and He literally adores me. We are considering opening a joint account next week so we can save for our vacation, our new home. It feels so amazing, I can’t wait….”
First of all, just before you open that joint account, do you really understand the: Why, When and What?
At some point in our lives as women, we probably will fall in love with that one person. Love is no doubt a beautiful feeling but it should not make one devoid of sense. There’s really no point being with someone you cannot be financially open/truthful with but there’s also absolutely zero wisdom in taking financial decisions without adequate information. If you’re a woman (single, married or engaged) looking to open a joint account with your partner, this piece is for you.
Opening a Joint Bank Account: The Why, What and When?
1. THE WHY? The big “Why”? Why are you opening that joint account? You both need to sit and ask yourselves Why? What’s the purpose of the joint account? What’s the goal for the account? This could be anything from saving for your wedding, honeymoon, new house, car, children’s school fees, vacation, family/joint projects or even emergency funding.
Answering the WHY question is so vital because it is the foundation for running your account- it provides clarity of purpose and vision; So someone doesn’t wake up one day and say “I’ll like to withdraw some money to pay for my friend’s wedding asoebi” (Nigerians can definitely relate!).
First of all, Ask WHY?
2. THE WHAT? What are the guidelines for running the account? How will the money be managed in terms of- when to withdraw, signatory and how much can be withdrawn at once. In a joint account, both of you should be authorized signatories to the account. When it comes to making withdrawals or decisions whatsoever concerning the account, no party should be able to take action without consent from the other.
Other vital questions to ask here include:
-How much are you willing to deposit and when? There must be timelines for deposits and how much each party is willing to contribute. It really doesn’t have to be an equal contribution; a husband with higher earnings may decide to put in more deposits than his wife does and vice-versa. Timelines also don’t have to tally. For example, if one person happens to be a business owner and the other a salary earner, they probably will run on different deposit timelines which is absolutely fine.
The focus is to ensure no party defaults.
-What happens if we decide to dissolve the account? In the case of “winding up”, what happens to the funds? Will it be shared equally or on what percentage?
Vital: Make sure to cross every t and dot every i .Read the thin lines, the clauses and talk to your account officer and your lawyer before you go ahead.
3. THE WHEN? This is probably more personal than financial. The question many people ask is: When is it okay to open a joint account?
Everyone, everywhere has an opinion, including the internet. For example, some people do not subscribe to an unmarried woman running a joint account with her partner while others see absolutely nothing wrong with it.
The opinion that really counts is yours and should be guided by factors like the personalities and beliefs that you both have (individually) when it comes to wealth and finances. What are your values and what is your spending style? Communication is KEY, Communication (verbal or non-verbal) is everything! What is your partner’s views when it comes to operating a joint-account? (Remember it’s joint so it cannot solely be one person’s idea). Pay a visit to your First Bank account officer and your lawyer together- know and understand your options together. You both should be on the same page!
Also, it’s advisable for both of you to own and run individual accounts before venturing into a joint-account ownership. Your individual accounts should (individually) be your primary go-to account for your personal expenses and everyday living.
Just before you open that joint account… ASK: WHY? WHAT? WHEN? And you will be pretty safe! Well, with First Bank, you always are safe!
Have you ever operated (or do you currently operate) a joint account? Share with us your experience and/or tips that have helped you. Comment in the box below.