Paying for Business Expenses Applying for a business credit card is something a small business should seriously consider for itself. Business credit cards can provide a range of benefits to a business. They allow a company to build up credit for better borrowing conditions down the road. They’re also quite easy to apply for. In this article, we’ll go over how to apply for a business credit card and other important points to note. What Is a Business Credit Card? A business credit card is a credit card that is intended for business expenses. These cards are not meant for any individual’s personal use, but they are available to businesses of all sizes. What Is a Business Credit Card Used For? Business credit cards are meant for business expenses, and as such, they come with several perks that you wouldn’t get with a normal credit card. Business credit cards typically have far higher credit limits than normal cards, but they are also harder to qualify for. [youmaylike] As a business phenomenon, business credit cards vary their offers greatly, and certain cards are meant for certain businesses. They are also highly customizable when it comes to individual payment terms. Businesses don't always have consistent incomes like individuals do, and business credit cards handle this problem. These cards are used to gain access to a long line of credit, to control employee spending on business expenses and more. One of their other common uses is to make accounting easier, as putting all business expenses on one separate account makes reporting to the Internal Revenue Service easier. In the end, there are many uses for a business credit card. Why Would I Need a Business Credit Card? You might not need one, but if you run a business, you’ll be leaving money on the table by not at least looking into them. Business credit cards can solve many of the problems business owners face. If you need employees to make purchases for the business, a business credit card is the safest option. These cards can be given to authorized users, a status you can easily give to any of your employees. From here, these cards make it easy to monitor employee spending and spot any discrepancies. You can attach customized user privileges to each card to limit spending and place limits on where the card can be used. As mentioned, if you feel like your credit is too limited, business credit cards are a sure way around low credit. According to the American Bankers Association, the average monthly payment on a business credit card is twice as high as the average payment on a normal one. If you’ve found yourself annoyed with the Internal Revenue Service over the complicated reporting processes for business owners, you’re not alone. This is where a business credit card can solve another problem. Simply handing over your business credit card statements to your accountant will make them love you. It will also provide them with the information they need to predict future spending. Another great use for a business credit card is lifting your liability for debts. Liability for credit card debt is determined by the liability offered by the card. If you’re using a personal credit card for business expenses, you are liable for all debts. On the other hand, if you use a business credit card with commercial liability, your business is liable for any debts, which changes the game. Keep in mind that some cards offer joint liability, which leaves both you and your business liable for any debts. Make sure you know what you’re getting into before signing any paperwork. Lastly, just as personal credit cards offer rewards programs, so do business cards. The main difference here is that business credit card rewards are tailored to your business needs. How to Apply for a Business Credit Card Before you apply for a business credit card, you should make sure you’re eligible. For the most part, you only require the following to be able to apply for one: A legal name for your business. A business structure to apply with, such as a Limited Liability Corporation. An explanation of the nature of your business. You’ll typically be given a list of industry types to choose from. A tax ID number issued by the Internal Revenue Service Your roll in the business you’re representing Various business/financial information including: Annual revenue. Number of employees. Length of time in business. Estimated monthly expenses. If you have this information ready, you can apply for a business credit card. At this point, it would be wise to shop around and find the best option for your business. Your decision on the business credit card you choose will have larger ramifications than your choice of a personal credit card. Applying for a business credit card is much the same as applying for a personal one. There are a few differences, but the main thing to remember is that business credit cards are taken more seriously than normal ones, so you’ll have to face a higher bar of entry. This doesn’t mean getting a business credit card is hard, but it does mean you need to arrive more well-prepared than you normally would. To make things easier, you can prepare for certain obstacles in advance. You may need to sign a personal guarantee that you will pay off any debts. Also keep in mind that if you’re the one applying for a business credit card, and your business doesn’t already have one, they will conduct a personal credit check. It may be best to try to optimize your personal credit if you plan on applying for a business credit card in the future. Some Options at a Glance Here are some of the most popular options for small business credit cards: Chase Inc Business Preferred This is a great option for a few reasons. With the Business Preferred card from Chase Inc, you get 80,000 ultimate reward points when you spend $5,000 with the card in the first three months. The card also provides generic, but highly useful benefits for business owners. Business Platinum Card from American Express The Business Platinum is ideal for businesses that spend a lot on flights and travel. This card offers numerous rewards on flight and hotel expenses and makes sure you get something serious back if you use it for these expenses. Chase Inc Business Unlimited The Chase Inc Business Unlimited offers unlimited 1.5% cash back. While we’ve said enough already, they also offer several other perks that are overshadowed by their first one.
Tight Budget? Save Where You Can on Food
Saving money is often a difficult thing to do. When it comes to budgeting, it’s critically important to have a step-by-step process. This is especially true when it comes to groceries. If you want to know how to save money on groceries, keep reading, as we’ll be going over some helpful tips and tricks.
Budgeting
Incorporating groceries into your personal budget can be more daunting than incorporating expenses like transportation and utilities. This is perfectly normal, because who really wants to pinch pennies when it comes to the food you put into your stomach?
Unfortunately, groceries are becoming more expensive. According to USA Today, the price of food in the United States has risen 26.8% during the last decade. These increasing food costs have even managed to outpace the rate of inflation during the same period (21.9%). This trend does create a need to budget, as rent isn’t getting any cheaper either.
The good news is that even though budgeting groceries may take plenty of forethought, it isn’t the hardest thing to do when it comes to personal finances.
Where Do I Start?
Like any great financial endeavor, you’ll need to start by crunching some numbers. You’ll need to know exactly how much you spend on groceries, and how much goes towards specific products. If you haven’t already, you should start making note of all your grocery expenses. Start making simple yet detailed notes when you spend money on groceries. Are you buying staple items every month? Purchasing specific brand names? All of this will be important. Once you know exactly where your money is going, it’ll be much easier to take action and start saving.
Once you’ve painted a picture of your grocery-related expenses, it’s time to start being both more frugal and more resourceful. Being frugal involves cutting out some of the less useful expenses. This means cutting out food items that are pricey and don’t justify their prices through their nutritional value, and/or their cost-to-calorie ratio.
This may sound intimidating, but you don’t need to crunch the numbers on the number of calories you’re getting for each dollar. Instead, you’ll just want to cut the unnecessary costs. These costs include expensive junk food or food items that cost too much when a cheaper alternative is available. Resourcefulness, on the other hand, involves eliminating waste and getting your money’s worth when you buy groceries.
Let’s break these two down a bit more.
Resourcefulness: Getting the Biggest Bang for Your Buck
Resourcefulness is a broad idea, but with groceries, you can just try a few new habits to save money. There are plenty of ways to save money with new habits that can become second nature with a little practice.
One of the best ways to be resourceful with groceries is by cooking in bulk. Try cooking large meals and freezing them separately. For example, if you cook some chicken, rice, and potatoes, store and freeze them separately to have them ready to be heated up later. When it’s meal time, just take out the ingredients you need and heat them up. By getting into the habit of cooking in bulk and storing meals to be prepared for a quick cook-up, you can save both time and money. This way you can take fewer trips to the grocery store while also having your food organized so you don’t waste any.
A large part of being resourceful with your groceries involves having a consistent meal plan. If you know what you need to eat, what’s inexpensive, and what’s easy to prepare, you can put it into a meal plan that you can repeat. This way, you can also take advantage of sales by buying an item in bulk, cooking and freezing it, and making it last for a few days.
The last and most obvious component of resourcefulness is the hardest part. Regardless of how you feel at any given moment, you must insist on not buying what you don’t need. This means not giving into cravings that will drive you over your budget. If you can create new meal plans that are agreeable with your budget, then take full advantage of the opportunity.
Being Frugal: Including Groceries in Your Budget
Once you’ve gotten into the habit of being resourceful with what you have, it’s easier to be frugal. Base your grocery purchases on a healthy mix of what your body needs and what your wallet allows for. Find a way to put all the food groups you need into your meal plan at the most reasonable cost possible. The specifics will depend on your location and what’s in season.
While certain produce can cost more in some places than others, meats are generally more expensive wherever you go. Unless you have a personal health reason or an undying love of meat, it would be a great idea to cut out some meat in favor of other foods that are more critical to your health (and are cheaper, too).
While taking advantage of what’s in season and what’s generally cheap in your area is great, taking advantage of specific promotions can save you plenty. Plus, buying frozen produce is always less expensive than fresh, and allows you to stock up when there are sales.
Taking Advantage of Promotions and Deals
This is where you can truly get creative and have fun when it comes to budgeting your groceries. Sales are common in the grocery business and allow you to save upwards of half of the cost of products. One great rule of thumb is to only buy meat when it’s on sale. If you buy it in bulk, you can also freeze it for future use.
You can often find news about deals in flyers or by looking around in your local grocery store. Knowing both what’s in season and what’s on sale can save your wallet and satisfy your stomach at the same time.
Saving on Groceries Matters
Saving money on groceries is critical if you find yourself in a financial rough spot. You can cut many costs out of your life, but you’ll always need food. Knowing this, why not get into the habit of making your money go further in the areas that you know you’ll need to keep spending on?
By cutting back your grocery expenses, you can set money aside for other important things. You can start paying off debts or put more money into savings accounts. Saving money on groceries is important simply because it empowers you to improve your financial situation on a constant basis.