Credit Card

Reasons You Need a Business Credit Card

If you’re dreaming of owning a business, you are likely well aware of the expenses involved at start-up. No matter what type of business you have in mind, you will need to spend money. Business loans can be difficult to obtain and quite intimidating, to boot. A more accessible way to gain the cash you need to get your business off the ground may be through applying for a business credit card. Even if you have the initial start-up funds, there are always incidentals, supplies and unexpected expenses that crop up when starting a an entrepreneurial endeavor, so it’s a good idea to obtain a credit card for your small business as early as possible to provide a bit of stability for your finances. Let’s look at some other reasons you need a business credit card.

Available to Any Size Business
There’s no need to have a big business with a Federal ID number to qualify for a business credit card. They’re available to businesses of all sizes. If you’re running your business as a sole proprietor or DBA (Doing Business As), there are credit companies that cater to your needs. Some require nothing more than a social security number to apply, while others may ask for proof of a business checking account along with an EIN (Employer Identification Number).

Keeps Things Separate
When you own your own business, it’s wise to keep your company spending costs from your personal spending. The biggest reason for this is in regard to tax purposes. It will be far simpler for your accountant to account for business-related expenditures if they are on their own separate statement, ultimately costing you less in preparation fees. In addition, there is always the possibility of an IRS audit. Having separate records will save you a great deal of frustration.

Offers Higher Spending Limits and Perks
One of the biggest advantages to a credit card specifically for business is that these often offer high spending limits than personal accounts do, offering you the flexibility and security you need. Also, there are certain perks that come with these cards like vendor discounts on things like hotels or retail stores, extended warranties and purchase protection.

There are numerous reasons to get a business credit card for your small startup or even a larger-sized venture. Doing so early in the planning stages will allow you to feel more secure in your finances and have a bit of added security.

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