Establishing credit is important for small business owners who want to be more attractive to lenders and who are interested in making big purchases in the future. One of the best ways to get a good credit score is to use credit cards for personal and business purposes. While credit cards can certainly be beneficial if used the right way, they have the potential to cause problems. Here is a list of ways credit cards can devastate a small business owner.

High interest rates
Too many small business owners don't know how to be responsible with credit cards and can be hit hard by interest rates. Only applying for cards with 0 percent interest rates on purchases and balance transfers is one way to avoid this problem. These cards do not require small business owners to pay extra money back when settling their credit card bill.

Interest rates can also be a problem if small business owners fail to pay their bills on time. By only spending money they know they have, they can avoid expensive interest payments. Using budgeting planning software can give small firm owners some insights on their available cash flow for a given month.

Using only business credit cards
While business credit cards were created especially for firm owners, that doesn't mean they should be the only cards used for business purposes. Many personal credit cards have lower rates for payment delinquency. Small business owners should use these cards when they don't think they will be able to pay something off during one billing period. However, it's important to remember to not overspend on either a business or personal credit card.

Ignoring rewards programs
One of the main benefits of using credit cards is the rewards cardholders earn after accruing a certain amount of purchases or points when using a card. Overlooking these rewards could be a crucial mistake for small business owners who are usually cash-strapped. Some potential awards small business owners can receive are free cash, airline miles or office supplies. Failing to take advantage of rewards can be the difference between being able to afford a marketing campaign or  faster internet connection in the office.

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