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Nothing is more exciting than when you're ready to open a shared bank account with someone, and nothing is more depressing than being stuck with the responsibility of handling a financial mess that wasn't of your own making.

Joint accounts are an account that belong to two or more people, in which all account holders have equal rights, access, and responsibility for the money within the account. They come with upsides and downsides, so its important you understand exactly what you're getting into before you sign on the dotted line.

How are deposits and withdrawals made?

Different accounts have different mechanisms when it comes to deposits and withdrawals, so make sure you understand how these work before you sign. Some accounts allow the co-holders equal access to the account and any individual can deposit or withdrawal individually, whereas others require bother parties to sign off on each movement of money out of the account.

Who's liable?

Probably the most important part of opening a joint account is understanding who is liable for its contents, and the answer is generally "everyone". The norm for joint accounts is that each co-holder is equally liable for the money in the account, which means that if the account goes overdrawn, you are just as liable for repaying the debt, even if it wasn’t you who went overdrawn in the first place. This may have a knock on effect on your credit rating.

If the other person decides to withdraw all your money from the joint account and move to Mexico, in reality there is very little (if anything) you can do get that money back.

Can you trust you co-holder?

Following on from the question above, it's important you can trust your co-holder implicitly with your money. If they are to have equal rights and access to your money, and the potential to jeopardise your credit history, then it's important you know that they are trustworthy.

Do you know their financial history?

You may trust your account co-holder, but do you really know everything about their financial history? Before you open any joint account you should always have a frank and open conversation about financial history and any current outstanding debt.

Whilst, technically, their debt will not have any adverse affect on you, understanding their financial history may expose a pattern of financial behaviour that could make you think carefully about opening an account with them.

How do you close the account?

Make sure you know how to close the account before you agree to open it. Many accounts require all account holders to sign off on a closure, and if a partnership ended badly it can be a difficult thing to arrange.

What you absolutely do not want, is to leave yourself financially vulnerable by having a joint account open in your name that you cannot close, and to which another person has free access.  

What is the overdraft arrangement?

Look at what the overdraft arrangements is for the account, and if there is a "buffer" amount that the bank provides before you start paying overdraft fees. When sharing an account with one or more other people you have less control about what is coming in and out of the account, and so a buffer may prove invaluable for times when the balance drops below zero.