How Business Owners Can Choose a Credit Card.

Small business owners now have a wide variety of credit cards to choose from, and it makes it difficult to choose the best one for your small business. As a small business owner, you will need to decide which features you think that the company will use most often, and if they are worth using and having, before applying to a card. Many of the credit card companies now offer many attractive tools that can and will help each small business owner in their everyday spending and tracking. Also remember that it is harder to keep getting credit cards after the first couple, so choose wisely when choosing business credit cards.


Should you pick a business card that offers rewards or miles?

If you have no problem paying off the credit card debit each time the statement comes in, then the point rewards or cash back is the way to go for you. With the cash back and rewards credit cards, they give you rewards for spending money on everyday business needs, which is money you are going to spend anyway, so why not be rewarded for it. Another option to consider when choosing a credit card is the travel reward and miles credit cards. Do you or someone in your company travel on a regular basis? Then a travel reward or miles reward card is the type of card you might want to use. Most of the popular airlines have now teamed up with the credit card companies to bring business owners a reward for traveling for business purposes.

Should I get help tracking and reporting your expenses?

Most credit cards that are geared for the small business and even for larger businesses now, have a feature that is attractive in more than one way. The credit card companies can now track the categories that money is being spent on every month, and they can also provide a quarterly or annual spending report. This comes in handy during tax time. If you plan to use the same credit card for all of your expenses, this may be a great option for you.

Do members of your staff need to have access to a credit card?

Most of the credit card companies that offer cards to small businesses have a feature that allows employees of the business to also carry a credit card. This feature helps the business owner and the employee. When the employee travels now, they have the business with them to back them up in case anything should come up. Employees now can keep track of their spending for business related purposes a lot more efficiently now. The credit card companies can also track the credit card expenses separately so there is no confusion over who spent what. Not to mention the reimbursement paper work and waiting will now be eliminated. The credit card companies also allow the owner to set the amount of funds that are available to each card.

Small business owners also need to watch out for credit cards and the rates they charge with balance transfers and also with the APRs. This can be a great asset to a small business owner. Zero percent interest on balance transfers seems to be the going rate right now, and makes it nice to have an interest free loan for a little while, but beware! If you miss one payment you will lose that nice 0% APR and will have to pay the full rate.

Credit cards have changed so much over the years. They are very helpful to the business owners and their employees. Most credit card companies have now done away with the yearly fees that used to be associated with owning a credit card. So, if you are a business owner that pays the balance every month, these are the types of cards you need to apply for.

Guaranteed Credit Cards for Bad Credit Folks

I just received an email from a reader :


“Hi Mr Credit Card, my credit has taken a hit but I do need a credit card. Do you have any suggestions for guaranteed credit cards for bad credit folks like me? I have been turned down by a couple of the major credit card companies. My score is in the 500s.”

Well, all I can say is that if you have a fico score in the 500 area, credit card issuers and any finance companies will consider you to be a sub-prime borrower. Therefore, the cost of credit to you will be much higher. There are credit cards that are specifically geared towards borrowers like this reader, but they do come with higher costs and fees. Here are the different types of credit cards available and the pros and cons to each one.

1. Unsecured sub-prime credit cards - There are many issuers of sub-prime credit cards. For example, First Premier Bank and Orchard Bank - now HSBC are two of the more well-known sub-prime issuers.

The thing to be aware of when you are apply for one of these cards is the fees. You will most likely be hit with one-time application and processing fees, annual fees and even monthly maintenance fees! I wrote about this in Bad Credit Card Application Fees and Fineprints.

Secured Credit Cards - You are almost always guaranteed to be approved for secured credit cards because you must put a deposit with the credit card issuer. The deposit will be your credit limit and if you default, it acts as your collateral. Most secured credit cards do not have any of the fees that unsecured sub-prime cards charge. They usually just have a reasonable annual fee. The only thing you really have to ask is if the secured credit card reports your payments to the three major credit bureaus. This is because this is the only way for you to rebuild your credit.

Prepaid Credit Cards - You may also see ads touting prepaid debit cards. Though they may be great because you are not extended credit, it also means that you cannot rebuild your damaged credit with a prepaid debit card. It is also more costly than regular credit cards or even a secured credit cards. So unless you got into this mess with uncontrolled spending, I would certainly not recommend a prepaid credit card.

Bottom Line - Even if you have bad credit, you can get a credit card. Most sub-prime credit card issuers will approve your application. You just have to be aware that you have to pay higher fees. If can settle for a secured credit card, then you will not have to pay as many fees as a regular sub-prime unsecured credit card