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In 2021, I finally started my small LLC — my “side hustle.” After many years of doing freelance content creation here and there, I decided to give my little business a name and register it with the state. I was not alone. Between 2019 and 2021, almost two million small businesses started. By comparison, just 400,000 small businesses launched between 2011 and 2016.*
In our new world, where working from home and small business is the new normal, it’s no wonder that banks are catching on and offering competitive products, including business credit cards.
I knew I should have a separate business bank account, and when I called the bank to set it up, the representative mentioned the business credit card. I’ll admit, I was pretty naïve in the beginning. I have a national bank that I’ve had an account at since I was a teenager. I wasn’t even thinking about business anything, let alone hunting for a business credit card.
I thought, why not?
Now I’m glad I opened the business credit card account. Not only does it keep all my business expenses separate, making accounting that much easier at tax time, but it has become a partner in building my business.
1. You don’t necessarily need to have a company to get a business credit card.
For my bank, Bank of America, I needed to have proof of my business with an EIN number, which was easy to request from the IRS website. From there, I could open my business checking account and credit card.
But, sole proprietors can use their social security number when asked for an EIN. In fact, my business accountant advised that I use my social security number rather than my EIN when I pay my quarterly taxes.
If you’d rather not go through the EIN request process, and do not have to with your bank or credit card issuer, don’t.
2. The extra $30,000 to play with came in handy — financially and emotionally.
My starting credit limit was about three times that of my personal credit cards when I opened my account. While my consulting business didn’t require a huge upfront cost, it was great to know I had (and still do) nearly $30,000 at my fingertips should I need it. There was also a zero APR for the first nine months, so it was the perfect time to buy a new laptop and phone, get a $300 credit (see number three below), and set up for success.
3. You can earn cash when you spend within the first few months.
The first months are when you’re probably going to invest in your business. I had software subscriptions, technology upgrades (Hello ring lights and cameras!), and other startup expenses, which made earning a $300 statement credit by spending $3,000 in the first 90 days pretty easy.
4. There’s solid equipment buyer protection (to help ease jangled startup nerves).
My business credit card offers significant perks that gave me peace of mind when I was starting my business, especially when purchasing delicate and costly things like a quality camera and phone. The card automatically includes a solid purchase security/extended protection plan, which replaces, repairs, or reimburses me (the cardholder) up to the total purchase price in the first 90 days, with a maximum of $10,000. That also includes gifts for friends and family.
A Complete Guide to the Chase Ink Business Credit Cards: Earn $900 or 100,000 Points
5. Reward deals on pro services like Dropbox and cash back on car rentals.
I also like the rebate/discount program that the card includes, which provides an automatic benefit on eligible purchases from participating businesses in the United States. The merchant list is on a separate perks website and includes the kinds of products I really needed for a virtual business, like 20% off a Dropbox subscription and 5% cash back on car rentals.
There is also an innovative service that I found super valuable (for me, it was like having a virtual business startup coach): Mastercard Digital Doors®. The program says it is “helping small businesses open their digital doors,” and it’s full of easily digestible information and offers from partner companies. So, if you’re just starting, you can get reduced-cost access to things like QuickBooks® online and Salesforce essentials software to help manage customers.
6. Say hello to no annual fee.
It may not be true for all credit card companies, but my business credit card through Bank of America gives me all of the perks without an annual fee. An annual fee can be fine if the benefits to your business outweigh the cost, but that’s a calculation only you can do. Obviously, no annual fee is a no-brainer YES because it can save you anywhere from $95 to $450 a year.
So, if you’re like me — one of the millions of emerging entrepreneurs — a business credit card might be just the silent business partner you need.
More Credit Card Rewards
Credit cards have a reputation for causing people to go into debt. Yet the idea that opening credit cards is a bad financial choice isn’t fair or accurate. You get to decide how you will use your credit cards, just as you get to decide how you’ll use the money in your bank account.
Our card roundups help people maximize their credit card rewards earnings for planned, everyday spending. Here are a few to get you started:
- Biggest Credit Card Bonuses
- Best Cash-Back Credit Card Bonuses
- Biggest Business Credit Card Bonuses
- Best “No Annual Fee” Credit Card Bonuses
- Biggest Travel Credit Card Bonuses
- Best Credit Card Deals and Promotions
If you feel confident that you can manage your credit cards responsibly (paying on time and in full every month), your accounts can be an asset instead of a burden. A well-managed credit card may help you to establish better credit scores over time and can help you take advantage of some amazing rewards.