What is a joint high yield savings account?

Quick insights

• A joint high yield savings account (HYSA) is a savings account shared by multiple people that may provide a higher-than-average rate of return. 
• It can be shared by anywhere from two to four people, depending on the provider. 
• HYSAs are typically offered by online banks and fintech companies, rather than brick-and-mortar banks. 

Having shared access to a checking or savings account can help simplify money management with a partner, roommate or family members. Whether you’re working toward a common financial goal or want to give someone access to a savings account you own, there are many potential benefits of having a joint savings account.

In this article, we’ll discuss what a joint high yield savings account is, considerations before opening an account and how to open one.

Joint high yield savings accounts explained

A high-yield savings account is a type of savings account that may offer a higher rate of return than a traditional savings account. They can have an annual percentage yield (APY) several times higher than a typical savings account.

HYSAs are often offered by online banks and fintech companies that operate without brick-and-mortar locations or the physical staff required to maintain them. This lower overhead may allow for some unique perks, like higher APYs, waiving common fees and, sometimes, not requiring a minimum deposit or account balance.

A joint HYSA allows multiple people to deposit and withdraw funds into the account. Although Chase currently does not offer HYSAs, these accounts can typically be linked to checking and savings accounts at traditional banks.

Opening a joint high yield savings account

A joint savings account is typically owned by two people, but some providers may allow for as many as four people on the account. Those with access to the account usually need to be at least 18 years old and a U.S. resident.

Most HYSA providers operate online, so you’ll begin your application on their website. Some HYSA approvals can be processed in a matter of minutes.

You may need to have the following on hand to complete the application:

• A Social Security number (SSN) or Tax Identification Number (TIN)
• A U.S. residential street address
• Legal name
• Birth date
• Employment information
• Annual income

The person who initiates the application will likely be designated as the primary account holder. They can add another person (or persons) to the account either during the application process or once the account is open, depending on the provider.

Some accounts may not require a deposit to open the account but often stipulate that the account needs to be funded within a certain timeframe to remain open.

Considerations when opening a HYSA

The prospect of a higher-than-usual rate of return is one key reason people consider opening a HYSA. But you may want to weigh some of the pros and cons of HYSAs, including:

• Limited withdrawals: Like traditional savings accounts, some financial institutions may limit the number of withdrawals and transfers you can make from a HYSA each month. Exceeding this limit could result in fees or restrictions on your account.
• Transfer times: A HYSA may not be the best place to keep funds that you want immediate access to. Making deposits or withdrawing money from an HYSA can take multiple days if you’re transferring to and from an account with a different provider.  
• Interest rates: When searching for a high-yield savings account, it may seem obvious to prioritize higher interest rates. But researching different accounts’ APY, which factors in compounding interest, may provide a clearer picture of your return than an interest rate.
• Fees: Evaluating the fees associated with the account, such as the monthly service fee or withdrawal limit fees, can help illuminate the costs that might be associated with a HYSA. 
• Deposit requirements: Many banks require an opening deposit with a new savings account. However, many HYSAs do not have any immediate funding or minimum account balance requirements.
• Common goals: It can be beneficial to work with a spouse or family member to grow your savings. But life changes—like divorce or relationship issues—can cause strain and financial strife.  

There are many institutions that offer HYSAs. They are commonly offered by online banks, but some credit unions offer HYSAs as well. Joining a credit union may have different protocols than a bank, like eligibility requirements or costs to join. Researching your available options and their individual requirements ahead of time may help determine what is most convenient for you.

In summary

Joint savings accounts provide a way for multiple people to access the same savings account. Depending on the provider, you may be able to have up to four people on the same joint savings account. Typically, one person will need to open the account and can add others to the account either during the application process or once the account is open.

A high yield savings account may provide a higher-than-average rate of return and require no minimum deposit, making it an appealing choice for people looking to save.