How to Pick The Right Credit Card for Your Business

Is your business small or growing? You should consider getting yourself a business credit card. Although choosing the best credit card might seem like an uphill task, you need to follow these steps to make it easier:

Business credit card

Know credit card basics

Before you decide to take out any cards, you need to know some card basics:

  • Business credit cards are only to be used when you have business expenses to take care of. This means that you should not place any personal expenses on this credit card.
  • In many instances, you will be able to give credit cards to your employees and follow their spending individually.
  • A business card usually comes with higher limits than a personal one, which can be helpful when you have to make many purchases during a certain month.
  • When taking a business credit card, you might have to make a personal guarantee. This means that you will be promising to pay off the balance using your own funds if the revenue from your business fails to cover the charges.
  • These are just the basics that will help you to make an informed decision when picking a business credit card. You need to do some deeper research if you are not convinced about anything.

Examine business expenditures

You need to look at your business books to figure out the biggest operating costs. This will provide a window into the kind of reward that you should be considering for your credit card. You should then start looking for credit cards that provide big rewards in your preferred categories.

For instance, if your business involves giving customer support over the phone, you will be spending most of your money on phone bills. You should go for a credit card that offers a bonus on this type of spending.

Examine the lifestyle of your business

Office building

Instead of looking at where your company money is going, choosing the right rewards program will require you to pick the right lifestyle for your business. To get started, you should ask yourself a few questions, including:

  • Does your business keep you on the road a lot? If so, you need a card that offers great rewards for gas consumption.
  • Do you to spend a lot of time traveling? If so, you need to find a card that lets you redeem rewards for hotels and flights.
  • Do you often need to entertain clients in restaurants and hotels? If you do, look for a card that offers rewards on restaurant spending.

Weigh the advantages and disadvantages of paying a yearly fee

When picking a business credit card, rewards should not be your only consideration; you should also think about your expenses. You should not dismiss cards that charge an annual fee automatically because they often come with higher signup bonuses and reward rates. You need to do the math when considering your annual spending.

Consider fringe benefits

If you have narrowed down your decision to a couple of cards, it is time to make your final choice. Start by thinking about your top contenders and the fringe benefits that they offer. For instance, if you want to make a large purchase and you do not know how to finance it, you should consider cards that offer 0percent APR deals. If you do not know which card to choose, you should compare cards on several websites. Are you spending a lot of time in airports? You should pick a card that offers lounge access to make your trips more comfortable. These tips will help you choose the right card.