Summary
Compared to business loans, credit cards are easy to get. But that makes them easy to abuse, too. Here are 5 ways to avoid getting stung.
The content on this page is accurate as of the posting date; however, some of our partner offers may have expired. Please review our list of best credit cards, or use our CardMatch™ tool to find cards matched to your needs.
Your credit cards journey is officially underway.
Keep an eye on your inbox—we’ll be sending over your first message soon.
- Be vigilant about avoiding penalties and fees. Although late-payment penalties aren’t particularly high for many small businesses, they do add up to a collective $2.9 billion a year for those firms, according to American Express OPEN.
- Watch out for those introductory offers promising no interest until a certain date. Keep a close eye on when the interest rate will soar from 0 percent to more than 10 percent or more. “Some small business owners see the myriad special offers from creditors, apply for and gain credit, and use it without attention to the fine print,” says Vickie Mauldin, executive director of the First Command Educational Foundation, a Fort Worth, Texas, nonprofit that promotes financial literacy.
- Look for cards that offer rewards, such as cash-back bonuses, airline miles and special discounts. “Small business owners love it when they ‘make money’ on what they spend,” small business strategist and author Romanus Wolter says.
- Do not mix personal and business spending on your company accounts, recommends Michael McAuliffe, president of the nonprofit Family Credit Counseling Service of Chicago. Mixing the two can make it difficult at tax time to discern between business and personal expenses, he says.
- Know your limits. A business owner may have several credit cards with a combined credit limit of $75,000, but he or she may be unable to manage more than $25,000 worth of debt, advises Gene Fairbrother, lead small business consultant at the National Association for the Self-Employed.
To comment on this story, write to editors@creditcards.com.
See more small business credit card news.
Editorial Disclaimer
The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.
Join the Discussion
We encourage an active and insightful conversation among our users. Please help us keep our community civil and respectful. For your safety, do not disclose confidential or personal information such as bank account numbers or social security numbers. Anything you post may be disclosed, published, transmitted or reused.
The editorial content on CreditCards.com is not sponsored by any bank or credit card issuer. The journalists in the editorial department are separate from the company’s business operations. The comments posted below are not provided, reviewed or approved by any company mentioned in our editorial content. Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.