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Make Your Recordkeeping a Little Easier With Small Business Credit Cards

Keeping track of paperwork can be a nightmare for small business owners. From income to expenses, invoices to client files - everywhere you turn it seems there is another stack of paperwork waiting for your attention! At first glance, it may seem that credit cards would only complicate things and give you even more paperwork to deal with - but when they are used effectively, credit cards actually help streamline the process, save you precious time, and maybe even earn you a little something more!

A Balanced Checkbook in Half the Time

If you've primarily used your checking account to pay for your business expenses and purchases, you could find balancing the register at the end of the month a time consuming and difficult task. Using small business credit cards can eliminate this problem and save you a lot of time and effort.

When you use a business credit card to pay for all business expenses and purchases throughout the month, you will have very minimal transactions to record in your checking account register. On your credit card statement, you'll see every purchase and expense itemized for you; you can write a single check to pay for your credit card bill, and reduce the number of transactions in your check register to one or two each month! Not only does this make it faster to balance your checkbook, but it reduces the chance of making a mathematical error, since there is very little in the check register to add and subtract.

While some business owners worry about having to pay excessive interest on their credit card bill, you can actually use a credit card the same as cash with a little financial discipline. Simply pay the credit card balance in full each time the statement arrives within the card's grace period, and you won't pay interest on your purchases.

Automatically Update Accounting Software

Business credit cards also offer automatic downloads of your transaction history into most of the popular accounting software programs. If you use accounting software to manage your business financial data, you can instantly download and update the information from your credit card issuer's website at the click of a button.

Monitor Employee Spending at a Glance

If you have an employee (or few) that need to make purchases on behalf of your business, it makes sense to give them a business credit card. We've all heard nightmare stories of employees who manage to buy their holiday gifts or take vacations on business credit, and it can cause severe anxiety for a business owner to simply hand over the credit card!

To reduce anxiety, many business owners require employees to get prior approval for every transaction before making the purchase Ð but this is extremely time consuming and can cause a number of problems and delays for your business operations. What if vendors come looking for their payments when you are out of the office or in meetings? An easier, more effective method of monitoring your employee's spending is to issue your employee(s) a business credit card in their name, linked to your business credit card account.

Most business credit cards make it possible to set monthly spending limits per card, so you can relax knowing your employees don't have exclusive access to your entire credit limit. Not only can you limit the amount the employee is able to spend, but when the billing statement arrives, all transactions are itemized and separated. You can tell at a glance which employee made which purchase, and should you discover an employee abuses their credit card priviledge, you'll know before it gets out of control.

Keep it in The Business

As a business owner, you undoubtedly understand the importance of keeping personal and business finances separated. A very simple way to do this without a lot of fuss is to get a credit card that is used for your business expenses and purchases. When you pay your credit card statement, you know that every transaction you're paying for is a business expense, and you can avoid monitoring each credit card statement transaction to highlight the business expenses from a list of personal expenses. Use your bank account or personal credit card for personal expenses and purchases; and a separate credit card for all business transactions and you've instantly eliminated the time consuming task of separating your business finances from personal each month.

Quick Financial Reports

Business credit card lenders understand the needs of the business owner to categorize their spending. In addition to regular monthly statements, most give you the option to receive quarterly and annual reports. These additional financial reporting options make tax-time a breeze! You will no longer find yourself sifting through a box or drawer of receipts - you'll have just about everything you need on a single print-out from your credit card company, and even categorized by the type of expense.

There are a number of credit card companies that give cardholders the option to generate and print custom reports as needed. If you needed a list of all the payments you've made to a specific company - you just enter those details in your online account management system and hit print.

Getting “More” From Credit Cards

Not only does using a credit card in your business make your financial record keeping easier, but if you got into the habit of using that same business card for all of your business expenses and purchases, you would accumulate credit card rewards faster.

When choosing a credit card for your business, choose one that offers rewards you will actually use. Many offer travel rewards in the form of hotel stays or airline miles - but if you don't travel much, choose from one of the other types of rewards cards that can help you get discounts on office supplies or gasoline, for example.

When you use a business credit card effectively, it can literally increase your productivity level. They save you considerable time on managing financial records, and switching to a system where you use only one credit card for everything business related could even help you eliminate the need for a bookkeeper.


Debbie Dragon is a freelance writer who writes frequently on the topics of credit, HYPERLINK "http://www.destroydebt.com/"get out of debt methods, and business planning. She welcomes feedback at debradragon@gmail.com.