Joint bank accounts are ideal for people who want to share some or all of their finances. Your savings are an essential part of building a secure financial future. Joint savings accounts allow two (or more) people to deposit, save, and withdraw funds in the same account, with shared equal access.
A High Interest Savings Account is a specific type of savings account, providing you much higher interest on your savings, as the name suggests. A High Interest Savings Account (or HISA for short) works in much the same way as a traditional savings account, but with the addition of higher yields.
What is a High Interest Savings Account?
A High Interest Savings Account (also known as a High Yield Savings Account (HYSA)) is a savings account that earns you more money than a traditional savings account through higher interest rates. The big benefit of HISAs – and what draws so many Canadfians to these accounts – is the big boost in savings they can offer. Where traditional savings accounts usually offer about 0.1-0.3% interest, you can find HISAs with 3-4% interest. That can be 10x the interest earning, or even more. So, it’s easy to see why HISAs are so popular. For example, if you have $1000 in a traditional savings account earning 0.3% interest, you’d earn $3, but in a HISA earning 3% interest, you’d earn $30.
What is a Joint Account and Who is it For?
A joint bank account is really pretty similar to a regular solo account. The difference is that two (or more) people are involved. Joint accounts are perfect for couples (either married or not). But they’re also great for others who might need to share access to money, for any number of reasons.
With a joint account, two (or more) people can register for the account together and they’ll have equal rights and equal access to the account. This means everyone who has their name attached to the account can deposit, transfer, or withdraw money – without needing permission from the other account holders.
Examples where a joint account makes sense
Ultimately, you need to really trust the person (or people) you open a joint bank account with. As you will have the same access to the account, you should have discussions beforehand, and possibly put in place informal rules around how you use the account.
Some good examples of who a joint account can benefit:
Couples. Whether you’re married or not, a joint account can be a great way to pool resources for shared expenses (bills or groceries, for example) or to save for something you’ll enjoy together (like a vacation, a car, a wedding, or even a house).
Business partners. A joint account can mean business partners are each able to pull money from a shared pool, without having to later remedy the spending.
Parents and kids. A joint account can be great for parents to add funds to an account that their child can access. This could be instead of cash pocketmoney, or perhaps to support an older child who has traveled away on their own to university, for example.
Older parents who need assistance. A joint account can also help adult children help out their elderly parents who need assistance managing money.
What to look for in a High Interest Joint Savings Account?
While many joint savings accounts aren’t specifically named a High Interest Savings Account (HISA), you certainly can find joint savings accounts that will deliver higher interest rates. Generally, traditional savings accounts (whether joint or solo) will offer less than 1% interest – and often considerably less. Many traditional savings accounts offer just 0.1-0.3% interest. If you’re after a high interest account, that ain’t it. Instead, whether it’s called a HISA or not, just look for accounts offering 2% or more. You can find joint savings accounts offering interest north of 3%, and these are ideal.
Joint accounts generally operate very similarly to solo accounts. If you’re opening a joint savings account with higher interest earnings, look for the same things you would with a traditional savings account. Check with the bank or financial institution to make sure you have flexibility with your account, to see if there are any restrictions on how many transitions you can make per month, if there are monthly account fees, if you’ll have access to a handy and simple banking app, and that the bank you sign up with has a good reputation for customer service.
How Do Joint Bank Accounts Work?
Setting up a joint account requires everyone who will be a named account holder to complete the necessary documentation. Digital-only banks and online financial services companies offering joint accounts allow you to open accounts online, while traditional banks may require all co-applicants to go to a branch in-person to complete the application.
The application will usually require account information from all co-applicants, including your social insurance number (SIN), your address to prove you’re a Canadian resident, and your date of birth to show you’re the age of majority where you reside. Applicants will usually need to all provide one or two pieces of identification.
Once a joint savings account is established, each account holder can deposit money into the account, pay bills, and transfer and withdraw funds as needed. Every account holder has completely equal rights and permissions to use the joint account. Because of this, joint account holders share the responsibility of managing their account, including making financial decisions and monitoring transactions.
The “joint” aspect of a joint savings account is really important. The money in a joint account belongs to all account holders. This shared ownership means you need to trust your co-applicants completely and be on the same page when it comes to managing your shared finances.
Is a Joint High Interest Savings Account Right for You?
You need to fully trust your fellow account holders if you’re going to open a joint savings account with them. While you hope it would never happen, in a worst-case scenario your co-applicants would have the means to clean out your joint account without your approval. You need to have an open and trusting relationship with whoever you sign up with, and you should have regular discussions about what the account is for, when to use it, and how you want to jointly manage your shared finances.
With two (or more) people involved, you can cooperate on your finances and share the administrative load of paying bills, setting aside money, and transferring funds, as needed. By consolidating your accounts together, there will also be fewer accounts to monitor, making it easier to stay on top of everything.
Just because you’re opening a joint account, that doesn’t mean you can’t still keep some of your own money separate as well. A combo or hybrid approach can work great, particularly for couples. Having a joint savings account can help you save together for things you’ll share in future – vacations, a house deposit, groceries and bills, etcetera – but it’s perfectly okay to keep your own personal spending money separate.
Ultimately, if you’re exploring a joint savings account, you should do your own research alongside your potential co-applicants to see if it’s the right financial move for all of you.
KOHO Credit and Savings Account
KOHO offers a comprehensive suite of tools and informative spending and savings guides to help you manage and improve your finances. Whether you're interested in learning more about money management, opening a savings account, or building your credit, KOHO has you covered.
Sam Boyer spends, invests, budgets, and writes. He enjoys writing about things he wishes he’d learned earlier — like spending, investing, and budgeting. A journalist originally from New Zealand, Sam has written extensively about consumer affairs, insurance, travel, health, and crime.