Should You Open A Credit Card for Your Business?
Owning a business is an exciting venture that every self-sufficient entrepreneur loves to take part in. Taking that step to bring a good or service to the community is filled with seemingly endless questions: Where to start, how many people to hire and most importantly, how to get the money to fund the business’ success. Getting a business credit card is a great way to help with that last question — and all of the others before it — so you can fuel your company’s success while working to stay out of debt. If you are on the fence about getting a credit card for your investment, check out Liberty Debt Relief’s top recommendations for saying yes to a business credit card.
Your business has a steady income
The best time to open up a credit card is when you have a proven financial track record. Opening a business takes a lot of time, patience and money and the last thing you want to do is get into a significant amount of debt before you are able to pay it off. If you think it is time to look into opening up a credit card for your business, take a look at your business’ finances from the past few years. Specifically, consider how much money you have earned, lost and what financial resources you need to continue to grow.
When your business has earned a steady income and is projected to continue to do so, getting a business credit card can help your business establish accreditation while also building your personal credit score and staying out of debt. The primary factor you want to consider is if you will be able to make any monthly payments toward the card without going into personal or business debt. If so, getting a credit card can help you better manage the business’ finances, get higher credit limits, and even earn rewards that will allow you to invest back into your business.
Your business has grown
Growth is every businessman or business woman’s favorite word. For freshly started entrepreneurs, it can make the difference between a hole-in-the-wall shop to two large storefronts in a big city. While a credit card is not the best option for your business if you are using it solely to fund a business expansion, it can be a great way to continue already established growth.
Along with helping you get more merchandise to fit the demand of your customers, it can also allow you to be more versatile in your opportunities. Cash back rewards, for example, will allow you to pay for your standard costs while also gaining some additional money to help offset costs. A great business credit card will also give you rewards for business travel and can provide you with multiple cards that employees can use for expenses they come across while on the job.
You’re a freelancer looking for more opportunity
Business credit cards are not just for business owners looking to stay out of debt; they are also extremely beneficial to freelancers. Being a freelancer can be difficult when juggling invoices with different companies and going line by line on your account statements to determine what’s personal and what’s business related. Additionally, having a business credit card provides you with protection. Many freelancers do not have the same protections as other employees because they are not with a specific company for an extended of time. If you were ever faced with a legal challenge while working as a freelancer, having a card specifically for your business will ensure that your personal accounts stay unaffected and you have the financial backing needed to solve the issue quickly and effectively.
Many freelancers also require a significant amount of travel and equipment. By investing in a credit card for your freelance business, you can establish a little more wiggle room to travel for more work or even invest in your business. If you are a freelance designer or reporter, for example, you can use your business card for a new and faster laptop and software, or even dedicate more time to a client who wants to meet in a different state while racking up rewards that you can use in the future.
When not to open a business credit card
While a credit card is a great way to take your business to the next level, it is not the right move for everyone. If you are just starting your business, for example, and have not established a regular and stable income, then getting business credit cards may actually put you in more debt. It is always crucial to make sure with any new line of credit that you can pay off the debt every month or you risk getting high interest added to the amount and sinking your business before you have the chance to see it flourish.
A solution for everyone
If you think that opening a credit card for your business may be the right route for you, then consider speaking to a Liberty Debt Relief Debt Consultant. They will help you figure out your short-term and long-term financial goals for you and your business to come up with the solution that fits you and your needs.
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