Small Business Credit Card – Benefits Business Owners
If you own a small business, you might just
have significant monthly expenses that are required in its operation. But in
many cases you may not yet have sufficient cash on hand to pay for those
expenses. For those reasons, a business credit card or a small business
credit card can come in handy, given the benefits offered for business
owners in particular. It is a temptation indeed to spend more than one
should with a credit card. This lack of control, however, is the primary
source of the profits in the credit card industry. If you have the financial
insight to manage your money as a business owner, business credit cards
could give you the flexibility you need to manage day to day expenses.
Business credit cards used with care could be just the thing you need to
help you manage your growing business.
One difference between personal and business credit cards is the operation of purchase tracking. Your purchases are tracked under your company name, not your name, and so the marketing offers that you receive for your business would be based on what you have purchased with your business credit cards, not your personal cards. A benefit of this tracking would be that your company would have a business history which may prove to be a great asset.
Another difference is the way expenses are tracked. Your business credit card statement should come with a detailed list of transactions, broken down by type of expense. When you are arranging your monthly budgeting, or your yearly or quarterly financial projections for tax payments, these statements would come in handy when figuring out which expenses should be charged to which accounts, and which expenses are tax-deductible. This will be of significant use when you are managing your money, because you can trace individual transactions, and assign them to various parts of your budget.
Almost 75% of business experts surveyed have asserted that business credit cards and small business credit cards prove to be an easier way to manage expenses than a checking account. Checking accounts require the manual recording of transactions, and when people make mistakes or even forget to record those transactions, unpleasant surprises can turn up in the form of overdrafts. Your monthly statement will include every expense in detail.
Business credit card accounts also have some fringe benefits that personal credit cards do not always have. Your account should include extra cards, if necessary, for additional (trusted) employees, and it may even include travel insurance, both for travel cancellations, and even for accidents that happen to your employees (or to you!) while on business travel. These extra cards will really come in handy once your business starts to grow. If you are the primary decision maker, you often have several crucial decisions to make at once, and you are often involved in many elements of your business at one time. If you have purchases that are routine, having other employees who are authorized to make those purchases will free up a lot of your spare time. Since your business credit card would come with detailed expense tracking, you would feel the comfort of delegating these sorts of purchase decisions to others, leaving you more time to focus on growing your business.
As we progress into the information age, these detailed statements are now
available online for your use in the comfort of your own office or home.
Using the right accounting software, you could merge your online statements
with your existing account files to automatically match expenses with
budgeted accounts. Why pay an accountant to sit and match those expenses up
when you can use a software package would do the same job at half the time
and cost probably a lot less than the salary of an accountant? All you need
to do is monitor the online merge process periodically.