Using Business Credit Cards to Earn Rewards on Everyday Expenses

As a business owner, everyday expenses like office supplies, utilities, and travel can add up quickly. However, with the right business credit card, these routine purchases can be an opportunity to earn valuable rewards. By strategically using business credit cards, you can turn your daily expenditures into points, miles, or cash back, providing significant benefits for your business.

In this detailed guide, we’ll explore strategies for using business credit cards to earn rewards on everyday expenses, helping you maximize your rewards and optimize your spending. Let’s dive in!

Why Use Business Credit Cards for Everyday Expenses?

Using business credit cards for everyday expenses offers several advantages:

Earning Rewards: Earn points, miles, or cash back on every purchase, turning routine spending into valuable rewards.
Expense Management: Simplify tracking and managing business expenses with detailed statements and expense reports.
Cash Flow Management: Smooth out cash flow by using credit for purchases and paying off balances when income arrives.
Separation of Finances: Keep personal and business finances separate, making it easier for accounting and tax purposes.

1. Choose the Right Business Credit Card

Selecting the right business credit card is the first step to maximizing rewards on everyday expenses. Here’s what to consider:

Spending Categories: Identify your business’s primary spending categories (e.g., office supplies, utilities, travel) and choose a card that offers high rewards in those areas.
Rewards Program: Determine whether you prefer cash back, points, or miles, and select a card that aligns with your preferences.
Annual Fees: Evaluate whether the rewards and benefits justify the card’s annual fee, if any.
Additional Benefits: Consider additional perks like travel insurance, purchase protection, and expense management tools.

2. Leverage Bonus Categories

Many business credit cards offer higher rewards rates in specific categories. Here’s how to leverage these bonus categories:

Office Supplies: Use a card that offers high rewards on office supplies for purchases like paper, ink, and office furniture. Cards like the Chase Ink Business Cash Credit Card offer 5% cash back on office supply purchases.
Utilities and Telecommunications: Choose a card that provides extra rewards for utilities and telecommunications expenses. For example, the Chase Ink Business Cash Credit Card also offers 5% cash back on internet, cable, and phone services.
Travel: If your business involves frequent travel, select a card that offers high rewards on travel expenses such as airfare, hotels, and car rentals. The American Express Business Platinum Card offers 5X points on flights and prepaid hotels booked through Amex Travel.

3. Plan and Consolidate Spending

To maximize rewards, plan and consolidate your spending:

Consolidate Purchases: Whenever possible, consolidate purchases into fewer transactions to hit spending thresholds for bonus rewards or sign-up bonuses.
Recurring Expenses: Set up automatic payments for recurring expenses like utilities, internet, and subscriptions on your rewards credit card to ensure consistent earning.
Employee Cards: Issue employee cards and encourage them to use the card for business-related purchases. Many business credit cards offer free employee cards with customizable spending limits.

4. Maximize Reward Redemptions

Once you’ve earned rewards, it’s important to redeem them strategically to maximize their value:

Cash Back: Redeem cash back rewards as statement credits, direct deposits, or checks to maximize flexibility.
Travel Points: Transfer points to travel partners or use them through travel portals for higher value redemptions. For instance, Chase Ultimate Rewards points are worth 25% more when redeemed for travel through the Chase portal.
Gift Cards and Merchandise: While convenient, redeeming points for gift cards or merchandise often provides lower value. Consider these options only if they offer a favorable redemption rate.

5. Avoid Common Pitfalls

While earning rewards on everyday expenses can be highly beneficial, there are potential pitfalls to avoid:

Overspending: Don’t spend more than necessary just to earn rewards. Ensure that your spending aligns with your business budget.
Interest Charges: Carrying a balance can negate the value of your rewards due to interest charges. Aim to pay off your balance in full each month.
Neglecting Fees: Be mindful of any fees associated with the card, such as late payment fees or foreign transaction fees, as these can reduce the overall value of your rewards.

Top Business Credit Cards for Everyday Expenses

Here are some top business credit cards that are excellent for earning rewards on everyday expenses:

1. Chase Ink Business Cash Credit Card:

Rewards: 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable, and phone services each account anniversary year; 2% cash back on the first $25,000 spent in combined purchases at gas stations and restaurants each account anniversary year; 1% cash back on all other purchases.
Benefits: No annual fee, sign-up bonus, purchase protection, and travel insurance.

2. American Express Blue Business Cash Card:

Rewards: 2% cash back on all eligible purchases up to $50,000 per calendar year, then 1%.
Benefits: No annual fee, expense management tools, purchase protection, and extended warranties.

3. Capital One Spark Cash Select for Business:

Rewards: 1.5% cash back on every purchase, every day.
Benefits: No annual fee, introductory 0% APR on purchases for the first 9 months, and purchase protection.

4. Bank of America Business Advantage Customized Cash Rewards Credit Card:

Rewards: 3% cash back in a category of your choice (gas stations, office supply stores, travel, TV/telecom & wireless, computer services, or business consulting services) on the first $50,000 in combined choice category/dining purchases each calendar year, 2% on dining, and 1% on all other purchases.
Benefits: No annual fee, customizable rewards categories, and sign-up bonus.

5. U.S. Bank Business Triple Cash Rewards World Elite Mastercard:

Rewards: 3% cash back on eligible purchases at gas stations, office supply stores, cell phone service providers, and restaurants; 1% cash back on all other eligible purchases.
Benefits: No annual fee, $500 cash back bonus after spending $4,500 in the first 150 days, and 0% introductory APR on purchases and balance transfers for the first 15 billing cycles.

Conclusion

Using business credit cards to earn rewards on everyday expenses is a smart strategy to enhance your business’s financial health. By selecting the right card, leveraging bonus categories, planning your spending, and maximizing reward redemptions, you can turn routine purchases into valuable rewards. Avoid common pitfalls and choose a card that aligns with your spending habits and business needs to make the most of your rewards.

What business credit card strategies have you found most effective? Share your tips and experiences in the comments below!

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