Using Your Business Credit Card WiselyBusiness credit cards are the biggest source of financing for small business owners, with 59 percent of business owners having used credit cards in the past 12 months for business purchases. One third of businesses report 25% or more of the company's overall debt/financing is credit card debt. Within the last year, many credit card companies have increased interest rates and cut credit limits.This causes concern for many business owners, but a business credit card is a necessity. There smart option is to pay off the credit card balance in full each billing period. One of the first rules of business is to keep business and personal expenses separate. It may be convenient to pay for business and personal expenses at the same time, but this will eliminate the advantages of using a business credit card. Not only will it be easier to determine business expenses for tax preparation, but it becomes easier to track spending and analyze data. By using a business credit card for all business purchases, a company can easily manage all expenses on one statement. This enables businesses to maintain a firm control on their financial future. Intelligent use of credit cards enables a company to effectively negotiate with lenders and other credit card issuers to obtain the best credit terms and conditions for the company. The key is to use your business credit card wisely. Before you choose and use a business credit card, make sure the card and the purchases will benefit the company. Business credit cards can be convenient and very useful if used correctly. |
