Most contractors drive around a full-size pickup truck with hundreds of pounds, and frequently use thousands of dollars of construction equipment. Yet one of their most significant tools can become a few grams of plastic in their wallet. The right small enterprise credit card can help contractors track business expenses, finance materials, and even earn valuable rewards.
How a best credit card for construction business Can Benefit Construction Contractors
There are several ways that a credit card can help you to achieve your business goals:
Improve Your Cash Flow
One of the main great things about business credit cards for contractors is just how they improve earnings. The best business credit cards provide you with a line of credit that gives you extra time to pay for purchases.
Receive Interest Free Loans
If you pay your credit card off completely every month, you’ll avoid interest charges and can enjoy the benefits associated with these cards at no extra cost. Some cards even offer introductory APRs of 0% for anywhere from six months to a year or more. That interest-free period can be valuable if you need to make a sizable purchase and shell out the dough over time.
Earn Rewards for Spending
In addition, rewards programs can be very lucrative. Put the materials you purchase in your business on a rewards credit card and you may often earn thousands in cash return or reward points. (Sign-up bonuses or welcome offers can also help you boost those rewards significantly.)
Improve your accounting
Having a business credit card means that you can keep your business charges separate from your individual accounts.
What to Consider When Choosing a Credit Card for Your Construction or Contracting Business
There are several things you want to consider when choosing a business credit card:
If your business is construction, your first priority might not be travel rewards often offered with small company cards, including airport business lounge access, rental car coverage, and other travel perks. (If you enjoy travel, whether for pleasure or business though, travel rewards can be quite valuable, including Amex Membership Rewards points and Chase Ultimate Rewards points.)
You may find cash back rewards to be an improved fit. If so, be sure to carefully evaluate the card’s rewards rate. Do you earn a flat cash back rate (or points) for all business purchases or will you earn higher rewards using bonus categories? In case the latter, be sure to choose a card that gives bonus points for the type of purchases you typically make. And ideally, contractors can look for a card that offers 2x or 3x points or cash again for the varieties of purchases that they maximize, such as gas or hardware purchases.
Business Card Features
For small business owners who need to issue employee cards, look for employee spending controls and expense tracking. You can also look for cards that offer free employee cards, along with spending controls. On the other hand, it’s unlikely that contractors is likely to make business purchases beyond your US, so you won’t have to worry if your credit card has foreign transaction fees.
Build Your Credit
It’s also important to understand how your business mastercard will impact your credit score. Some credit card issuers report all activity to the owner’s personal credit, most are accountable to business credit (which can help build good business credit scores) and some report to both. If you know you’ll be carrying a balance frequently, for example, you may want to choose a card that will not appear on your personal credit history, as those balances could impact your personal credit scores and impact your creditworthiness.
Enjoy Introductory Financing
Finally, if you know you will carry a balance every once in awhile ensure you understand the rates of interest you may be charged for purchases and balance transfers. If you choose a card with low intro APR, be certain to produce a note on your calendar of when it expires, and attempt to pay off the balance before that happens. Otherwise, your cost can increase significantly.