Now that the Supreme Court has ruled that in some respects businesses are people, it may be time to let your small business grow up and get a credit card of its own.
Before you apply for a small business credit card
As your business grows, it may be more beneficial for you to get a corporate credit card. But if you’re still in the early stages of business development, don’t pull the trigger on a dedicated card too quickly. You might be better off using a personal credit card for your business, as long as you have enough wiggle room in your credit limit. Just make sure the business reimburses you regularly, so you’re not stuck with the company’s debt if things go sour.
If you have a good credit score, the right type of credit for you might not be a credit card. A line of credit may offer you higher limits and lower interest rates. But the rewards, security and convenience of a credit card could outweigh its higher interest rates, especially if you can afford to pay off your balance in full each month.
Credit card features to look for
Business credit cards come in many varieties, just like credit cards for individuals. To narrow your search, here are a few features to look for when evaluating credit card offers for your business.
Some of the best small business credit cards are chock full of perks, including extra points for common business expenses like office supplies, utilities and travel costs. Evaluate your spending to see what you’re likely to put on the card, and look for a credit card that offers rewards for your biggest expenses.
Sign-up bonuses can also be lucrative, but make sure you aren’t committing yourself to high annual fees or other unfavorable features just for one-time freebies.
2. No foreign transaction fees
If you or your employees frequently travel outside of the United States, look for a card that doesn’t make international trips even more expensive. Most cards charge a 3% fee on each foreign transaction, which can add up quickly.
3. Support for authorized users
If you’re a sole proprietor, you really only need a card for yourself. But as you add business partners or employees, look for a corporate credit card that gives you multiple cards at no extra charge. The ideal issuer would also offer the tools necessary to track spending across those cards.
4. Low annual fees
Many rewards cards come with higher annual fees, but that’s not true across the board. Look for a balance—reasonable fees along with the features you want. If you’re paying more than $100 in annual fees, you can probably do better elsewhere.
Shopping for a credit card for your business doesn’t have to be complicated. Check out NerdWallet’s business credit card comparison tool, and find the best possible credit card deal for your growing company.
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