A joint account is a bank or brokerage account shared between two or more individuals. Joint accounts are most likely to be used by relatives, couples, or business partners who have a level of familiarity and trust with each other. It typically allows anyone named on the account to access funds within it. There are multiple ways accounts can be established, each with its own implications for how money or assets can be accessed within the account or how the contents of the account are handled after one of the joint holders passes away.
How Joint Accounts Work?
Joint accounts work just like regular accounts, except they can have two or more authorized users. Joint accounts can be established on a permanent basis, such as an account for a couple into which their salaries are deposited. The account may also be temporary, such as an account between two parties who are contributing funds in the short term.
Uses and Benefits of Joint Accounts
Joint accounts can be useful for their holders and provide a number of benefits. Many accounts require minimum balances, particularly if the holder wants to access the benefits of a specific account type. By pooling their money, two people can bypass this requirement and reap the benefits of the account.
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