How can you choose a credit card that complements your business? What particular factors should influence your choice? Here are some tips:
Your purpose for acquiring a business credit card. Why do you need a business credit card and how do you plan to use it? If you plan to use it often, it’s best to get a business credit card with rewards. Nevertheless, if you plan to use it only for emergency expenses, you may consider getting a low APR business credit card instead.
Would you go for a travel reward business credit card or one with cash back rewards? Would you sign up for a business credit card with gas rewards? What type of reward credit card would be most useful for your business? Don’t forget that you can only get the most benefit from a reward credit card if you pick one that matches your needs and spending.
Your Preferred Mode of payment. Can you pay off your balances in full every month? Or do you plan to carry over balances from month to month? If you intend to carry a balance, make sure that you get a credit card with the lowest APR.
Find out more on: Seeking The Best Reward Credit Card For Your Business
Unlike regular credit cards, it is easier to get a gas station card. This is because gasoline stations often have less strict requirements than banks or credit card companies. Anyone can easily get approved for a gas station card as long as he has a proof of identification or driver’s license.
Credit history is not a requirement for getting a gas card. In fact, these cards can be used to establish credit history or to rebuild bad credit as well. If you have a problem getting approved for a regular credit card because of a low credit score, you may start with a gasoline station card first.
What’s the difference between gas station cards and gas reward credit cards?
Find out more on: What are the advantages of owning a gas station card?
A CREDIT CARD can be a good friend or your worst enemy. These grave mistakes will turn your credit card into your worst foe.
1. Not staying on top of interest paid
Most consumers are attracted by credit cards that have rewards like free miles or cash rebates. That’s fine as long as you pay off monthly balances in full. But if you’re what industry insiders call a revolver—paying just a portion of your balance—you’ll be easily hurt by interest charges. So, shop around for the best rates.
Also, check the annual percentage rate (APR) and not just the nominal rate. Figure out how interest is computed. Is it a straight computation based on your outstanding balance? Or is it based on your average daily balance? The formula can also be based on a shorter number of days, instead of a full 30 days.
2. Paying only the minimum
Pay in full. If you find yourself paying just the minimum every month, you’re spending more than you can afford. You’ll be slapped with hefty finance charges. A 20-year old with a P100,000 balance on his credit card, a 3.5% monthly interest rate and a 5.0% minimum payment, will still have debt when he retires at 65 if he pays only the minimum.
Now, if you have no choice but to pay the minimum, stagger your payments weekly and not pay the lump sum on the due date. This is because for many credit cards, finance charges are computed on an average daily balance. So with declining balances over the credit cycle, the average daily balance—and the interest charge—gets lower.
More importantly, cut back on your expenses. Manuel “Chut” Santiago, Jr., General Manager of UnionBank Card Center, says, “Credit card spending should be part of an overall spending plan. Cardholders should not spend more than what they can quickly repay.”
If your spending gets out of control, ask for a lower credit limit, or if things get worse, cut your card and pay in cash. Cecille Fonacier, Citibank Marketing Director, explains, “A credit card is a very convenient tool to have, if used responsibly. Remember that credit cards give you spending power, but not more money.”
3. Paying late
Pay your balances on time, every time. Even if you can only afford to pay the minimum, pay it on time. Late payments are costly as you’ll have to pay a late penalty fee of around 6% and a finance charge of 3.5% every month. Chut says, “Paying late or missing payments can quickly ruin your credit as well as increase the cost of maintaining the card.”
Now, if you miss a payment once in a while, ask to have your penalty fee waived. If you’ve been an overall good cardholder, you’ll get your wish granted. Remember, it never hurts to ask.
Maximizing the use of your rewards credit card does not mean you should spend more on your credit card without thinking about your budget. On the contrary, maximizing the use of rewards credit cards mean you should choose the right one and manage it correctly.
Reward credit cards come with different reward programs. There are reward credit cards that only give points from travel-related purchases; others exclusively give rebates from gas purchases; while other reward credit cards give points on all types of purchases made on the card. You can only receive your reward if you can reach the minimum points your card requires from you. Clearly, you can earn more rewards more quickly if you choose the reward credit card that matches your spending.
To get more from your reward credit card, you need to take advantage of the 0% introductory APR. This means, for the whole introductory period, you don’t need to worry about paying for the interest. However, it is important to be clear about the credit card’s policy. Does the 0% interest apply only on balance transfers or only on purchases or both.
You must also be aware about the deadline of the 0% introductory period. Of course, you need to make sure that the interest will remain at reasonable rate even beyond the introductory period.
Find out more on: How You Can Maximize Rewards from Credit Cards
When choosing business credit cards, we often hear the advice to choose the one that best suits your type of business. Before making a choice, it’s important to carefully explore all your options, spend time comparing one potential card to the next, read the fine print, and understand the card’s Terms and Conditions. But how do you know which credit card really matches your business? What particular factors should influence your decision? Here are some factors to consider:
Your purpose for acquiring a business credit card. What do you primarily intend to do with your business credit card? How do you plan to use it as a tool in improving your business? Will you use it mostly to charge your travel costs? Will you use it to make your monthly inventory purchases? Or will it serve as a back-up for emergency expenses?
If you intend to use your card on a regular basis, you may consider getting a business credit card with rewards. Otherwise, if you don’t plan to use it as often, you may go with non-reward business credit card with the lowest APR.
Your Preferred Mode of payment. How do you plan to keep up with your credit card charges? Will you pay off your monthly balances in full? Or do you think you’ll need to carry over your balances on most months?
If it’s not possible to completely pay off your balances each month, skip reward credit cards and go for a business credit card with a low APR. On the other hand, if you’re sure that you can keep up with your monthly payments without carrying over your charges, then a reward business credit card may be a better choice.
Find out more on: The Best Credit Card for Your Business
Starwood Preferred Guest (SPG) Card and Hilton HHonors Card are both issued by American Express (Amex). They are also both hotel credit cards, so whats the difference? which is better?
- The Starwood Preferred Guest Credit Card from American Express® is designed for those with good credit who often stays at Starwood hotels and resorts and arrange to take advantage of the various rewards program services and benefits that are offered. You earn one point for every dollar spent on the card and double points are earned at participating Starwood retail and properties outlets. You can also earn one additional point per $1 spent on qualified purchases through their membership in the Starwood Preferred Guest® loyalty program. Read Full Review
- The Hilton HHonors Credit Card from American Express® gives its card members the opportunity to earn mileage points for a free travel with not just one but 50 different airline affiliates. There are over 2, 800 participating Hilton hotels that you can stay with and earn your points wherever you are. It allows you to earn 5 points for every dollar you spend at Hilton Hotels, standalone supermarkets, gas stations, drugstores, selected dining establishments, US Post Office and Wireless Phone Bills. You also earn 3 points for every dollar you spend on other purchases. In addition, it does not carry an annual fee, while the SPG Amex charges $45 after the first year. Read Full Review
Btw, do you know that there’s also an Hilton HHonor Card from Citibank? So which do you think is better Hilton HHonors from American Express or Citibank?
Find out more on: Which is better the SPG or Hilton HHonors Card?