How do you set up a savings account for friends to save for a holiday together?
There are 12 of us planning a trip and would like to set up a bank account so that each of us can save by direct debit each month to give us a lump sum for spending come the trip. What is the best way of going about this
Personal Finance - 7 Answers
People Answers, Critics, Comments, Opinions :
Answer 1 :
You can try online banking such as smartypig.com to save up for a goal. Or you can just use your bank and direct deposit into that account.
Answer 2 :
Don't even think about it! Each have your own account. There will be issues with bank charges for unpaid dd's, someone will end up short of money and miss a few payments etc. And the bank will insist that one person at one address is ultimately responsible for the account - they won't send out 12 statements or 12 copies of a bank charge! The person responsible can end up with their credit rating affected if another person bounces a few dd's. EDIT - Well there you go - another reason for not doing it! Steven points out that you could all suffer if one person causes problems. (Thanks Steven, I didn't know that was the case.)
Answer 3 :
This is a crazy idea. Just let everyone save (and spend) their own money. There's no way you could have an account with 12 signatories, which means only 2 or 3 of you at most would be in charge of the account. It just is not worth the risk and hassle if they decided to do something stupid, compared to what you gain (nothing as far as I can see) of saving jointly.
Answer 4 :
The best way is NOT to combine your savings. you should each save your OWN money individually. When you are ready to leave for the trip, you can put all the money in one account for easier access if you want. Calra B. The bank will only sent one statement to one address, but they will hold ALL 12 liable even if 11 had NO CLUE there was an issue. SimonC: The bank WILL allow 12 signatories. That is the problem. ANY of the 12 can create liability for ALL 12.
Answer 5 :
You apply for an TIN number from the IRS as a Hobby Club. Then you start saving. Otherwise one of you uses their SSN but that person gets hit with paying taxes on the interest. 12 people will be putting quite a bit of money in that account.
Answer 6 :
I would each set up an account each and then combine the money at the end. There may be problems setting up an account when you all live at different addresses plus what happens if there any charges etc. If you do set up a joint account make sure you put guards in place to stop one person taking all the money out without permission from the rest.
Answer 7 :
This is a very bad idea, for many reasons.
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