Can You Have a Joint Retirement Account?

While many couples wonder if they can open a joint retirement account to save for their future, the concept of a joint retirement account is a common misconception. Traditional retirement accounts, such as Individual Retirement Arrangements (IRAs) and 401(k)s, are generally established and maintained on an individual basis. This individual structure is fundamental to how these tax-advantaged savings vehicles operate in the United States.

The Individual Nature of Retirement Accounts

Retirement accounts are primarily designed for individual savers, distinguishing them from joint bank accounts or taxable brokerage accounts. This individual structure is rooted in tax regulations and identification requirements. Each retirement account, whether an IRA or an employer-sponsored plan like a 401(k) or 403(b), is linked to a single individual’s Social Security Number (SSN) for tax reporting. This linkage ensures proper tracking of contributions, earnings, and distributions for each taxpayer.

Contribution limits and tax deductions or credits are generally tied to individual income and tax filing status. For instance, an individual’s eligibility to contribute to a Roth IRA or deduct traditional IRA contributions is determined by their own modified adjusted gross income (MAGI) and whether they are covered by a workplace retirement plan.

These accounts provide tax-advantaged savings for a single individual’s retirement. Traditional 401(k) contributions are typically made with pre-tax dollars, reducing an individual’s current taxable income, and earnings grow tax-deferred until withdrawal. Roth IRA contributions are made with after-tax dollars, allowing qualified withdrawals in retirement to be tax-free.

In contrast, joint taxable brokerage accounts or joint bank accounts permit multiple owners, with each owner having equal rights to the assets. This highlights that while general investment accounts can be shared, the specific tax benefits and regulatory framework of retirement accounts necessitate individual ownership.

Retirement Savings Approaches for Couples

While a single joint retirement account is not possible, couples can effectively coordinate their individual retirement savings to meet shared financial goals. The primary method involves each spouse establishing and contributing to their own individual retirement accounts, such as separate IRAs, 401(k)s, or 403(b)s.

A key strategy for couples, especially when one spouse has limited or no earned income, is the spousal IRA. A working spouse can contribute to an IRA for a non-working or low-income spouse, provided they file a joint federal income tax return. For example, in 2025, the combined contributions to both spouses’ IRAs cannot exceed the working spouse’s taxable income or twice the annual IRA contribution limit, whichever is less. The annual IRA contribution limit for individuals under age 50 is $7,000, with an additional $1,000 catch-up contribution for those age 50 and older, bringing the total to $8,000.

Employer-sponsored plans, such as 401(k)s, are individual accounts tied to employment. Only the employee can contribute to it, along with any employer matching contributions. Contributions made to these plans by each spouse are a part of the couple’s overall retirement savings strategy.

Couples benefit from coordinating their individual retirement savings efforts. This coordination allows them to maximize contributions across all available accounts, take advantage of tax benefits, and ensure their combined savings align with their long-term retirement vision. Regularly reviewing their combined financial picture helps them make informed decisions about asset allocation and contribution levels.

Transferring Retirement Assets to a Surviving Spouse

The handling of individually held retirement assets upon the death of one spouse involves specific mechanisms to transfer wealth to the surviving spouse. Beneficiary designations on retirement accounts are a critical element; they dictate who inherits the assets and typically supersede instructions in a will.

When a spouse inherits a retirement account, they generally have several options. One common and often advantageous choice is to roll over the inherited IRA into their own existing or new IRA. This allows the surviving spouse to treat the inherited funds as their own, subject to their own required minimum distribution (RMD) rules, potentially deferring distributions until they reach their own RMD age, currently 73 for traditional IRAs. Another option is to keep the account as an inherited IRA, also known as a beneficiary IRA. This option requires the surviving spouse to take RMDs, with timing based on their own life expectancy or the deceased spouse’s.

The decision between rolling over the account and maintaining it as an inherited IRA can have significant tax implications and affect the timing of future withdrawals. Rolling over allows the surviving spouse to potentially delay RMDs and continue tax-deferred growth for a longer period. If the deceased spouse had not yet taken their RMD for the year of death, the surviving spouse generally must take that distribution before rolling over the remaining assets.

Given the importance of these choices and the potential for unintended consequences, regularly reviewing and updating beneficiary designations is paramount. Life events such as marriage, divorce, or the death of a primary beneficiary necessitate an immediate review to ensure the assets are distributed according to current wishes. While rules for non-spouse beneficiaries, such as the 10-year rule introduced by the SECURE Act, typically require the account to be depleted within a decade, spouses are afforded unique flexibility and more favorable treatment.