# Suggestions for joint bank account



## rd_aaron (Jun 24, 2011)

So I'm getting married in a month and we're starting to look opening a joint bank account. We have decided to automatically deposit X% of our incomes so that we split expenses based on our salaries. All of the joint expenses will come out of here and any leftover after expenses (we're planning on putting enough in to grow the account every month) will be used for larger expenses and any trips we take.

I'm looking for some suggestions on which bank/bank accounts would be good for our situation. I've looked at some but every bank has several different bank accounts and different perks so I was hoping to leverage some experience from this forum. Low transaction fees would be important as all our expenses (rent, cable/internet, power, insurance, etc) would be a transaction. Online banking a must.

I bank with CIBC, and my fiancee banks with RBC. We're interested in TD because of the longer hours and there's one fairly close to where we live. However, we could easily get to any of big 5. What about others like PC Financial? Any suggestions?


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## Spudd (Oct 11, 2011)

We have ours with TD. We like the longer hours, but the fees are quite high if you don't maintain a minimum balance. We keep 5k in the joint account at all times so we can take advantage of the "select service" account which gives a free premium credit card & free safety deposit box. 

If I didn't have such a large amount of inertia regarding my bank (I've been with TD all my life and it just seems like too much effort to switch) I would have gone to PC Financial probably. No fees and the service seems decent. But I haven't tried it so I can't speak from experience.


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## Suzuki12 (Apr 22, 2012)

Do yourselves a favour and get one account where all money goes into and out of. It's then 'our' money and no need to look at percentages. When we got married 31 years ago I was in school and my wife worked. Now almost of the income is from my employment but it's 'our' money. We've never looked at percentages.


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## KrissyFair (Jul 8, 2013)

Yay for proportionate contributions! I know so many couples who fair means 50/50 even if there's a discrepancy in what they earn. I would just add though that at least some amount of savings should be considered a bill so that if one of you is a good saver and the other plays a lot of golf (or whatever) then the good saver isn't stuck ponying up all of the retirement.

Beyond that - what Spudd said about TD.


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## rd_aaron (Jun 24, 2011)

When we first started work after school 3 years ago, we were splitting 50/50 as I wasn't making all that much more. My fiancee still makes good money, but the gap between our salaries is starting to widen so it's only fair.

@Suzuki: I don't think I'd feel comfortable having just one account as I think I generally have more expensive tastes than my SO. I don't see why she should have to foot the bill for my hockey league fees (about $1500/year) and equipment, or things like my golf clubs ($1000) while her golf clubs only cost $250. Sure, she has some expensive things as well, but I'm sure I spend quite a bit more than she does, so I don't want her to be subsidizing my expensive tastes. We each will put a % of our income into the account which will pay for bills and items like a new digital camera or a new couch that we'll both use, or a trip that we both go on, or when we go out for supper. We will retain our own personal accounts for play money.

@Spudd: Does the credit card provide any kind of benefits? Points? I aggressively collect Air Miles with the BMO Gold Air Miles card and collect quite a few, so I'm thinking of getting a joint credit card with Air Miles as well. I think a $5k balance should be pretty easy between two of us. Does PC Financial have all the same benefits as the big 5? Online banking? Email money transfers? Do I have to go into a Superstore to talk to someone?


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## Jungle (Feb 17, 2010)

We use PC Financial for 7-8 years now. Fits our needs fine since we don't require anything fancy.
+1 on our money too, our goals, our assets.

A good thing to have is each spouce has a little money they can spend for discretionary, so it doesnt feel like one other is holding back from their freedom to spend/.


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## Tawcan (Aug 3, 2012)

We use Coast Capital Savings for about 3 years now. Deposit all money in the joint account. All expenses come out of that account. It's easy and straight forward. No point keeping track of the percentages and see who spends more. Just consider all expenses as your household expensive.


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## cheech10 (Dec 31, 2010)

For those that use joint accounts: have you ever been audited about attributing investment gains to the lower income spouse for tax purposes? That seems to me a significant potential issue.


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## Spudd (Oct 11, 2011)

What investment gains? The joint account doesn't pay interest. 

To OP: the premium card from TD with the select service account is a 1.5% cashback to be used on travel (4.5% cashback when you buy travel through their site). We like to travel so it's a good card for us. It's called the TD Infinite Travel Visa or something like that.


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## cheech10 (Dec 31, 2010)

I mean, if funds are taken from the joint account to purchase investments, who do you attribute the investment income to?


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## Spudd (Oct 11, 2011)

Oh, I see. We haven't had that issue, so not sure how that would work.


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## liquidfinance (Jan 28, 2011)

I'm sure the only way this would get audited from an attribution perspective would be if one high income into joint account. Investments purchased by the non earning spouse then the said non earning spouse declaring all dividend or capital gains income. Ensure TFSA accounts are topped up as there is no attribution there anyway. 

Otherwise if your both filing tax returns with modest investments what is there to question?

Who really knows what would be the trigger point though.


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## realist (Apr 8, 2011)

My wife and I have our own accounts with a joint account that we basically use for transferring money between each other. We are currently doing the 50-50 thing, but I am making extra mortgage payments so we may be looking at the 80% idea more closely down the road. 

Look into the Air Miles card and whether or not it actually makes sense. . I found that for us we were MUCH better off to do a cash back rewards card than the air miles. 

One recommendation - talk in advance about what comes out of each pot of money. For example if you go on a trip together is that from the joint pot or from your individual pots? The reason I say this is there is potential for resentment if its coming out of your "individual" funds and she wants to take a trip, but you blow your money on sports instead of saving for a trip and can't afford to go.


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## MoreMiles (Apr 20, 2011)

I know a couple spiting 50/50. They have 2 children. So they also each take the responsibility of one child's expenses. The partner with higher income sent the child to private school and used brand-name merchandizes. The other child went to the public school and shop with the other parent in thrift stores all the time.

Does that make sense to you? It is fair from the parents point of view... but oh boy, I don't want to be one of those siblings.


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## AltaRed (Jun 8, 2009)

cheech10 said:


> I mean, if funds are taken from the joint account to purchase investments, who do you attribute the investment income to?


That should never be done. CRA technically requires you to keep a paper trail of whose money went into a specific investment so that it is that person to which income, cap gains/losses are attributed too. The best way to keep track of this is for the pay of each person to go to their own chequing account first, then each individual funds the joint account in whatever portion they wish from those personal accounts, and then the portion which goes into investments comes directly from the personal accounts, i.e. has a clear paper trail from the originating person. Whether CRA will ever audit is an open question and may never do so provided tax returns do not show the vast majority of investment income coming from the lower income spouse.

By the way, it is perfectly legal for the higher income spouse to disproportionately fund household expenses thereby allowing the lower income spouse to fund investments. Sort of income splitting. The key though is to have the paper trail available.

My former spouse and I had 2 joint investment accounts.... one with my name first and the other with her name first. I funded the one with my name first and she funded the one with her name first. Made it easy to keep track of attribution. We also had the paper trail to prove where that funding came from. It is not difficult to do, just a bit of discipline setting it up and then all is quite easy.


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## Karen (Jul 24, 2010)

MoreMiles said:


> I know a couple spiting 50/50. They have 2 children. So they also each take the responsibility of one child's expenses. The partner with higher income sent the child to private school and used brand-name merchandizes. The other child went to the public school and shop with the other parent in thrift stores all the time.
> 
> Does that make sense to you? It is fair from the parents point of view... but oh boy, I don't want to be one of those siblings.


How absolutely appalling! These children are being consciously raised to make it inevitable that terrible lifetime resentments are going to develop between them. I would go so far as to say that this is a case of child abuse, although not a usual example.


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## PrairieGal (Apr 2, 2011)

MoreMiles said:


> I know a couple spiting 50/50. They have 2 children. So they also each take the responsibility of one child's expenses. The partner with higher income sent the child to private school and used brand-name merchandizes. The other child went to the public school and shop with the other parent in thrift stores all the time.
> 
> Does that make sense to you? It is fair from the parents point of view... but oh boy, I don't want to be one of those siblings.


That is absolutely ridiculous! Both children need to be treated equally. There is nothing wrong with public school and thrift stores, but both parents need to be on the same page. I can't believe that the parents themselves think that this is a good idea.


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## rd_aaron (Jun 24, 2011)

realist said:


> My wife and I have our own accounts with a joint account that we basically use for transferring money between each other. We are currently doing the 50-50 thing, but I am making extra mortgage payments so we may be looking at the 80% idea more closely down the road.
> 
> Look into the Air Miles card and whether or not it actually makes sense. . I found that for us we were MUCH better off to do a cash back rewards card than the air miles.
> 
> One recommendation - talk in advance about what comes out of each pot of money. For example if you go on a trip together is that from the joint pot or from your individual pots? The reason I say this is there is potential for resentment if its coming out of your "individual" funds and she wants to take a trip, but you blow your money on sports instead of saving for a trip and can't afford to go.


I have an Air Miles card now and it has worked for us so far. We use it strictly for flights. I did a calculation recently for one of the flights we booked and it was the equivalent of 3% cash back, which is pretty good. It's not always that good but it's nice to have the option.

We'll definitely sit down and talk about what we use the joint account for, and how much we'll contribute each month so there are no surprises.


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## Ponderling (Mar 1, 2013)

This will sound wierd, but it works for us: 

We have separate bank accounts, but she has joint access to mine. 

I am not opposed to a joint account, but my wife is forever buying stuff for others that I cannot try to figure out where we stand. Things like pooled lotto tickets at work, theatre tickets for a group, avon sales, regal sales, weekenders sales are all things either now or in the past. 

So her account has the rainy day short terms savings, gets her salary into it, and is hers to spend. She gathers her money from others in time, and I don't worry about it. She makes her TFSA, and RRSP and open contributions from it. Saves for her next car, pays for car maintenace on her credits card, etc. Pays maybe $2 a month for this acocunt..

I keep my account reconciled every frew weeks, and it gets my salary and dividends ad management bonus payments as inflows. It pays major utility , insurance and tax bills. Used to pay mortgage. Now saves and makes contribuitongs to TFSA, RRSP, open account and RESP, and pays mastercard bill. I might pay a $20 annual fee and about $2 an month for transactions. I figure I own sotck in the bank directly and though mutuiual funds , so some of this money fitlers back to me. 

CTC mastercard causes us to comingle to build volume of transactions to save more CTC money up. It can make the bank fees look small. Most months we spin off about $10-20 in CTC money that goes towards buying household cleaning and paper supplies. Every couple of months we settle up. Usually she takes out cash for groceries, kids allowance, and that offsets the gas expenses on her vehicle, and share of utility bills that I pay that she has a stake in.

Wierd, but works for us.


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## tiffbou2 (Jul 4, 2013)

We have PC and we like it. No fees. You can also use CIBC bank machines without any transaction fees, which would be handy for your wife as all her banking could be done in one place. You also earn points towards groceries when you pay your bills online so every year we basically have a "free" grocery week. The only downside is that the people in those little kiosks know nothing. If you ever have a problem, it has to be dealt with over the phone (and frequently those people know nothing). We have fairly simple, straight forward banking so it's fine for us. We do also keep a basic TD account - mostly because the PC debit card does not have Plus, so you can't use it in other countries' debit machines.


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## marina628 (Dec 14, 2010)

Maybe old school here but my husband and i both put all our money into the same accounts ,our investments all come from the same pot too.We do have separate credit cards and own some real estate Individually.


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## My Own Advisor (Sep 24, 2012)

We pool all our money into our chequing account. We share our savings account and our emergency fund as well.

After that, we have our own investment accounts, RRSPs, TFSAs, etc.

We've never looked at percentages unless you mean 50/50


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## HaroldCrump (Jun 10, 2009)

Same here, all our savings and chequing accounts are joint (except my trading account, and separate TFSAs obviously).
But we are beneficiaries on each others registered accounts (TFSA and RRSP).

I don't see the point of having separate accounts. 
Having separate accounts can create mistrust and secrecy among the partners.


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## AltaRed (Jun 8, 2009)

It would be a rare coincidence (except spouses approximately earning the same) that each spouse puts exactly 50% in every investment. CRA can challenge the percentage splits and ask for the paper trail to demonstrate whose income went into which investment for tax purposes. If there is no evidence, it is my understanding they can pretty much assign percentages, probably based on proportionate income by each spouse, and ask for more back taxes from the higher income spouse. IOW, while it is not necessary to have separate accounts to show whose cash went where, it makes it easier to keep track of money flows with separate accounts. 

On investment accounts, they can still be joint (JTWROS) but have one with one spouse listed first (and the owner of those investments for tax purposes) and the other with the other spouse listed first (and the owner of investments for tax purposes). Precisely what my former spouse and I did for decades. Can be all done via one joint bank account with the proper paper trail documenting money flows.


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## Karen (Jul 24, 2010)

Years ago, when I was working for public mining exploration companies and my income tax situation was more complicated than it is now, I used to have a CA do my income tax returns. He told me that in his over 30 years of preparing tax returns, he had never had the tax department question a married couple who filed the interest on their bank accounts 50/50, as long as both partners filed tax returns.


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## YYC (Nov 12, 2012)

MoreMiles said:


> I know a couple spiting 50/50. They have 2 children. So they also each take the responsibility of one child's expenses. The partner with higher income sent the child to private school and used brand-name merchandizes. The other child went to the public school and shop with the other parent in thrift stores all the time..


This may be the stupidest thing I've ever heard of.

To the OP, I agree with Suzuki. It's all joint money once you're married, so what's the point of the extra hassle to keep it separated? If she supports your hockey fees, I assume you support her hobbies too, etc. It's just a big waste of time to muck around with trying to make everything "fair". You're married, you're a team, that's my opinion. 

As far as where to bank, we use PC financial for 90% of our day to day banking, it's free debit transactions, so it works well. Also one thing we have done is have a 'fun money' amount in the budget for each of us and set up a couple more 'accounts' inside the PC financial web portal (these don't cost anything either). Then we tied one to the savings on my card and the other to the savings on her card, and move the fun money into the appropriate account. This way I can spend out of my 'fun money' account until it's empty without having to worry about messing up the budget. Just an idea that works for us.


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## rd_aaron (Jun 24, 2011)

The way I see it is, if I go to the casino and blow $500 bucks out of our joint account, my wife might not be so happy that I blew $500 of OUR money. If it's out of my fun money account, then we don't have an issue cause we can spend our fun money how we choose. Every paycheque I'm still contributing enough to the joint account to pay for all the bills, and grow the account. Whatever is left over stays in our respective fun money accounts and is spent by us however we please. Adding additional accounts inside our joint account for fun money is an option I suppose, but for the time being we're going with this. As mentioned, it will also be easier for tracking our individual TFSA & RRSP accounts and contributing appropriately.

Anyways, back to what I was really asking. I'll look into PC Financial for sure. Free debit transactions is attractive. Are there monthly fees? My wife-to-be has a PC Financial credit card already so we're familiar with the free groceries. I wish BMO still had the "maintain $5000 balance and get 100 Air Miles/month". Trying to see if there are other similar perks at other institutions.


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## Guban (Jul 5, 2011)

Karen said:


> Years ago, when I was working for public mining exploration companies and my income tax situation was more complicated than it is now, I used to have a CA do my income tax returns. He told me that in his over 30 years of preparing tax returns, he had never had the tax department question a married couple who filed the interest on their bank accounts 50/50, as long as both partners filed tax returns.


I think that AltaRed was referring to investment income. Bank interest is pretty much insignificant in comparison.


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## tiffbou2 (Jul 4, 2013)

There are no monthly fees with PC. No fees at all unless you use bank machines that are not PC or CIBC.


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## Xoron (Jun 22, 2010)

AltaRed said:


> CRA can challenge the percentage splits and ask for the paper trail to demonstrate whose income went into which investment for tax purposes. If there is no evidence, it is my understanding they can pretty much assign percentages, probably based on proportionate income by each spouse, and ask for more back taxes from the higher income spouse. IOW, while it is not necessary to have separate accounts to show whose cash went where, it makes it easier to keep track of money flows with separate accounts.


You know, I never understood that. There is no gift tax in Canada, so why couldn't a higher income spouse give the money to the lower income spouse? If I were to give money to my sister / father / friend and they invest it, the income wouldn't come back to me.


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## kcowan (Jul 1, 2010)

The spousal money will come back to you if she dies.


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## AltaRed (Jun 8, 2009)

Xoron said:


> You know, I never understood that. There is no gift tax in Canada, so why couldn't a higher income spouse give the money to the lower income spouse? If I were to give money to my sister / father / friend and they invest it, the income wouldn't come back to me.


The Income Tax Act has specific provisions for couples (and minor children) that prohibit blanket income splitting (called non-arms length transactions). You cannot 'avoid' tax in your higher tax bracket by giving money to your lower income spouse, having her invest it and have her then claim the investment income. To do so is tax 'evasion'. You can give her the money and she can invest it BUT you have to claim the investment income on your tax return.

There are many ways around this, such as providing spousal loans with prescribed interest rates (there are tax bulletins on this subject), you can contribute to a spousal RRSP, you can preferentially pay the household bills freeing the income of the lower income spouse for investment purposes, etc. There are a few other quirks in the ITA as well that others can explain better than I can, for example, around dividend tax credits. BUT you cannot 'just decide' how you are going to split investment income between you and your spouse.

Your sister, father, friend, and adult children are all considered 'arms length' and thus money can be gifted without tax implications.


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## marina628 (Dec 14, 2010)

I would assume as long as the lower income earner is not saving more than they make this will never come up with cra.You cant earn $30,000 and save $100,000 a year that is common sense but you can save all your paycheck if your higher income partner is supporting you and paying all the bills.


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## AltaRed (Jun 8, 2009)

marina628 said:


> I would assume as long as the lower income earner is not saving more than they make this will never come up with cra.You cant earn $30,000 and save $100,000 a year that is common sense but you can save all your paycheck if your higher income partner is supporting you and paying all the bills.


Totally reasonable.


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## jcgd (Oct 30, 2011)

My fiancée has the right idea. My money goes into the joint account, her money goes into her account. And then she spends both. Keeps things simple. :rolleyes2:


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