3 Ways a Dedicated Business Credit Card Could Make It More Profitable

Business credit cards are an essential tool for managing your side gig finances as a freelancer. Many people wear more than one hat in an attempt to earn a second or third income these days. They clock out of their day job and right away go to work as a freelance creative, ecommerce entrepreneur, an Uber driver, or an AirBnB host.

The money from a gig economy job may be welcome, but it can take up a lot of your time when it comes to preparing your taxes. It can also make it hard for you to claim certain deductions. If you have income from gig economy work, it makes sense to set up a separate credit card for your business. Not only is it likely to simplify your bookkeeping and tax preparation, it can help you increase your income, as well.

If you’re not sure how a rewards business credit card can help you make the most of your side hustle, here are three points that you need to consider.

1) A separate business credit card helps you simplify your paperwork

When you use a separate business credit card for every expense related to your side business, you save valuable hours that you would otherwise spend sorting your business and personal expenses. You’d find it easier to keep track of all the deductions that you are eligible to claim, as well. If you plan to keep your side business going for the foreseeable future, it can even help to apply for a business credit card. It can help you build a credit history for your business, and make it easier for you to qualify for a business loan.

2) A separate credit card for your business can help you with your expenses

New business credit cards come with cashback offers, sign-up bonuses, rewards, and interest-free spending. Each one of these ways to profit from your business credit card spending can help you finance your business. While your cashback or points may amount to no more than 1 percent or 2 percent of what you put on your business credit card, it can add up to substantial sums over time, and help you with your cash flow.

3) You can plan your purchases to earn two kinds of rewards

Whether you plan to grow your side business to the point that it is full-time work one day or simply look to earn a little extra spending cash, it can make sense to turn to your business credit card. You can both make rewards on the business credit card, and win rewards on store loyalty programs.

Ridesharing driver: If you use a business credit card that earns you rewards when spending on gas, you can usually make two points for every dollar that you spend. If you also make use of a fuel vendor’s rewards program or an offer from your ridesharing company, you can profit even more.

AirBnB host: Rewards credit cards usually offer cashback as high as 5 percent when you make big purchases. You can get substantial rewards when you buy furniture or appliances for your AirBnB unit.

Marketing consultant: You can apply for a flat-rate card that gives you up to 5% percent back on all advertising spend for Facebook Ads and Google Ads.

When you have a dedicated credit card for your side business, it can help you take it more seriously, prepare taxes more easily, and make more money. While it may take a little research to find a credit card that gives you the best rewards for your specific kind of business, it can be effort well worth the time you spend on it.