Q: Should I get a business credit card?

-Wondering

A: Dear Wondering:

Business credit cards come with numerous advantages, along with significant risks. But when used wisely, these cards can be a valuable source of short-term investment capital.

Advantages of business cards include high credit limits of $50,000+ and rewards like airline miles, gas rebates, and discounted supplies. They also let you easily separate business and personal expenses.

One other major—but little-known—benefit of business cards involves using multiple cards offering 0% interest rates over an extended period. Known as card stacking, this can provide access to up to $250,000 in interest-free funding.

And because these are business cards, you can use all of the available credit without hurting your credit score, unlike personal cards which penalize you for high debt/credit ratios.

However, to ensure your personal score isn’t impacted, it’s vital to use a business card that does NOT report to consumer credit bureaus, only commercial ones.

That said, business cards aren’t a panacea, and if you default, you’ll be personally liable for the debt, and it will end up on your personal report. Indeed, if you fail to pay on time, these cards can quickly bankrupt your company.

For more on business credit funding, contact a Family Business Lawyer® or go to the familybusinesslawyer.co homepage and follow the video link under Fund Your Business