Dave Griffith asked:
Congratulations, you just opened your doors, hung your shingle or launched your website. Now let’s talk about credit cards! I know this might not be at the top of your to-do list, but you may be surprised to know that a business credit card can give you more time to focus on your business, pave the way to facilitating expansion, and save you money in the process.
I’ll tell you what, take a few minutes to read this article and you’ll probably find a way to fit applying for a small business card into your schedule today.
In the interest of time, I’ll cut to the chase and highlight a few things a business credit card can do for you right here. If you choose to read beyond these four points, I’ll give you more details.
1. Establish a credit history for your new business so that when you are ready to expand and become a bigger business, you’ll have a better chance of getting the loan you need.
2. Save you time every month by easily separating your business expenses from your personal expenses.
3. Save you money at tax time.
4. Protect your personal credit by keeping business credit card balances off of your credit bureau report.
If your ready to get a business credit card now, check out some of our favorites at Top Business Card Picks.
If your still not convinced, and have a little more time, here are the details.
Establish a credit history for your business: Many business credit card companies report the performance of their business credit card customers to one or more of the business credit bureaus (D&B, Experian or Equifax). Most lenders who make business loans will review reports from these companies when making lending decisions. Establishing a good credit history for your business by opening a business credit card, using it and making your payments on time will help you when you apply for loans in the future. Beware; while most business credit card companies report to the business credit bureaus, there are some that do not. It is probably worth a few minutes to call the credit card company you are considering, to ask if they do.
Save time by separating business from personal expenses: As a new business owner time is likely a scarce resource. Who wants to spend it combing through pages of credit card statement trying to separate your business and personal expenses? Using a business credit card can help you avoid time consuming conversations with yourself like, “was that Office Depot charge last month for printer ink for the office or for Tommy’s school project?”
Save money at tax time: I’d bet you have better things to do with your money than pay more taxes than necessary. Small business owners notoriously miss deductible expenses. Using a business credit card for as many business expenses as possible will help to ensure that you don’t miss any deductible expenses that are buried on your personal credit card statements. If you plan to use one, ask your accountant, I think you’ll find that he or she agrees.
Protect your personal credit: While many business credit card companies report to business credit bureaus, most do not report business card accounts unless you miss payments. This is an important, yet often overlooked benefit of a business credit card. Why? Credit scores, which virtually all lenders use to make credit decisions, are based on the information on your personal credit bureau. They consider things like your total amount of credit card balances, total number of credit cards and the how much of your total credit card limits you have used. If you use your personal credit cards for business purchases, lenders will think you personally have more credit card debt. This could decrease your credit score. A lower credit score makes it more likely you will have your APR increased, credit limits decreased or find it more difficult to get approved for things line mortgages and car loans. So keeping your business expenses off of your consumer credit bureau by using a small business credit card makes a lot of sense.
Now that you’re convinced, check out Creditgumbo.com’s Top Business Card Picks. Or, for more information, browse through the “Business Credit Card” listings in our Credit Blog section. Oh, and best of luck with your new business!
Marlene
Congratulations, you just opened your doors, hung your shingle or launched your website. Now let’s talk about credit cards! I know this might not be at the top of your to-do list, but you may be surprised to know that a business credit card can give you more time to focus on your business, pave the way to facilitating expansion, and save you money in the process.
I’ll tell you what, take a few minutes to read this article and you’ll probably find a way to fit applying for a small business card into your schedule today.
In the interest of time, I’ll cut to the chase and highlight a few things a business credit card can do for you right here. If you choose to read beyond these four points, I’ll give you more details.
1. Establish a credit history for your new business so that when you are ready to expand and become a bigger business, you’ll have a better chance of getting the loan you need.
2. Save you time every month by easily separating your business expenses from your personal expenses.
3. Save you money at tax time.
4. Protect your personal credit by keeping business credit card balances off of your credit bureau report.
If your ready to get a business credit card now, check out some of our favorites at Top Business Card Picks.
If your still not convinced, and have a little more time, here are the details.
Establish a credit history for your business: Many business credit card companies report the performance of their business credit card customers to one or more of the business credit bureaus (D&B, Experian or Equifax). Most lenders who make business loans will review reports from these companies when making lending decisions. Establishing a good credit history for your business by opening a business credit card, using it and making your payments on time will help you when you apply for loans in the future. Beware; while most business credit card companies report to the business credit bureaus, there are some that do not. It is probably worth a few minutes to call the credit card company you are considering, to ask if they do.
Save time by separating business from personal expenses: As a new business owner time is likely a scarce resource. Who wants to spend it combing through pages of credit card statement trying to separate your business and personal expenses? Using a business credit card can help you avoid time consuming conversations with yourself like, “was that Office Depot charge last month for printer ink for the office or for Tommy’s school project?”
Save money at tax time: I’d bet you have better things to do with your money than pay more taxes than necessary. Small business owners notoriously miss deductible expenses. Using a business credit card for as many business expenses as possible will help to ensure that you don’t miss any deductible expenses that are buried on your personal credit card statements. If you plan to use one, ask your accountant, I think you’ll find that he or she agrees.
Protect your personal credit: While many business credit card companies report to business credit bureaus, most do not report business card accounts unless you miss payments. This is an important, yet often overlooked benefit of a business credit card. Why? Credit scores, which virtually all lenders use to make credit decisions, are based on the information on your personal credit bureau. They consider things like your total amount of credit card balances, total number of credit cards and the how much of your total credit card limits you have used. If you use your personal credit cards for business purchases, lenders will think you personally have more credit card debt. This could decrease your credit score. A lower credit score makes it more likely you will have your APR increased, credit limits decreased or find it more difficult to get approved for things line mortgages and car loans. So keeping your business expenses off of your consumer credit bureau by using a small business credit card makes a lot of sense.
Now that you’re convinced, check out Creditgumbo.com’s Top Business Card Picks. Or, for more information, browse through the “Business Credit Card” listings in our Credit Blog section. Oh, and best of luck with your new business!
Marlene
