Benefits to expect from credit cards
There are a number of things you need to do in order to establish your business. Opening a business bank account is a great way to establish your business and to separate the business finances from your personal ones. By doing this you will be able to create a stronger image for your company and it will allow you to show your customers that you are a legitimate organization. As you initially get your business started, lenders may rely on your personal credit to make judgments as to how timely you will repay your debts to them. Opening a business credit card may require them to use your personal credit to approve you for the card and then you can start to establish business credit. Flashing your business credit card also helps you to show others that you have a legitimate company and it will be able to help you build up your reputation.
- So what are some of the other benefits you can expect when you open a business credit card? There are quite a few that you will greatly appreciate. Here are some of those benefits you want to watch for:
- Rewards! One of the great things about business credit cards is that they will come with a ton of rewards. These rewards can vary from anything like a free plane ticket to a hotel room or even concert tickets. The business rewards from credit card purchases tend to be greater than the rewards you will get by turning to a personal credit card. You can often get discounts at some office supply stores and hotel chains by using your business credit card. Look for a business credit card that comes with rewards that you will actually be able to use. There is no point in getting skymiles if you don't ever fly anywhere.
- Establish a reputation and a name for your business. As you start to use your business credit card, people will start to see your business name. You can start to rely on dropping your company name at stores that you frequent and you may be able to get discounts or at least get better customer service than what other people do because you are a loyal customer. Business credit does take time to build so you do need to be patient with the credit card as it is helping you to create a name for your business.
- Separation of business finances and personal finances. As a business owner it can be easy to get your finances mixed up. You have to work hard to separate the two for the IRS and opening a business credit card is a great way to do this. You will be able to keep them completely separate and only use the credit card for business needs. This can also save you a big headache as you won't need to go through all of the different receipts you have to divide them into personal expenses and business expenses. The other thing that it will do is keep your personal credit safe from any business expenses and things that can hurt it. You don't want your personal or business credit to get mixed up or it can damage both sides of the spectrum.
- Track employee spending. A lot of companies are hesitant to give employees access to credit cards because they can overspend. When you have a company credit card, you actually get to see exactly how much employees are spending and it will be able to help you better understand your business finances and look for ways to reduce your total expenses. It also helps to keep your employees honest as they know you are watching their spending.