How can John reduce his debt by paying into a joint account with Kelly?

In summary, John's debt to Kelly of £500 will be reduced by £50 every month if Kelly pays only half of her monthly contribution into their joint account and John pays the usual amount. This can also be achieved if both of them pay £150 into the account and John gives Kelly an additional £50.
  • #1
Buuuka86
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TL;DR Summary
Joint account calculations
John owes Kelly £500.

John and Kelly have a joint account. Each of them pays £200 into the account every month, to spend on joint expenses.

If Kelly pays only half of her monthly contribution into the joint account (so £100), and John pays the usual (£200) how much will John's debt (£500) be reduced by?

Just trying to work out my finances ;)
 
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  • #2
Buuuka86 said:
Summary:: Joint account calculations

John owes Kelly £500.

John and Kelly have a joint account. Each of them pays £200 into the account every month, to spend on joint expenses.

If Kelly pays only half of her monthly contribution into the joint account (so £100), and John pays the usual (£200) how much will John's debt (£500) be reduced by?

Just trying to work out my finances ;)
Is this a schoolwork question?

What have you tried to do to come up with an answer?
 
  • #3
It's a real life question :) I'm Kelly and my husband is John. I think the debt would be reduced by £50 every month but I'd love your help!
 
  • #4
I agree.
You get the same result if you both pay $150 into the account and John gives you $50.
 
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Likes Buuuka86

1. How do you calculate the interest earned on a joint account?

The interest earned on a joint account is calculated by multiplying the total balance of the account by the interest rate, and then dividing by the number of account holders. This is because the interest is split equally among all account holders.

2. Can joint account calculations be used for tax purposes?

Yes, joint account calculations can be used for tax purposes. The total interest earned on a joint account is divided equally among all account holders, and each person is responsible for reporting their share of the interest on their tax return.

3. How do you handle joint accounts with unequal contributions?

If one account holder has contributed more money to the joint account than the other, the interest earned will still be split equally. However, it is important to keep track of contributions and withdrawals to ensure that each account holder receives their fair share of the funds.

4. What happens to a joint account if one account holder passes away?

If one account holder passes away, the joint account will typically become the sole property of the remaining account holder. However, it is important to consult with a financial advisor or lawyer to ensure that the proper steps are taken to transfer ownership of the account.

5. Can joint account calculations be used for budgeting purposes?

Yes, joint account calculations can be used for budgeting purposes. By keeping track of the total balance and interest earned on a joint account, account holders can accurately budget and plan for future expenses or savings goals.

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