It may be tempting to use your business credit card to pay personal accounts, but watch out, this practice will affect your finances. Discover how to observe your budget and wisely use your credit cards.
Kurt A. Schindler, Certified Financial Planner® and director of the Financial Program at Banco Popular de Puerto Rico, reaffirms the importance of keeping separate personal and business credit cards. “We know that water and oil don’t mix, the same way personal and business accounts should be separated”. He explains that from the business account you will take out the money to pay for your labor. That payment is the one you will deposit to your personal account, from where you will take out money to comply with your individual obligations.
If from your personal account you wish to manage your commercial budget as well, you will have to review and separate the personal expenses from those of the business. A commercial account will allow you to check quickly the income and expenses of the company. The latter will facilitate life when submitting your income tax return and when applying for some banking product or service.
Commercial Credit Card Options
There are various credit cards you can consider for your business. For example, Popular/ AAdvantage® Visa Business, has a credit line from $5,000 to $50,000. Besides, it allows you to accumulate miles in the AAdvantage® of the American Airlines loyalty program. You can redeem these miles for stays in hotels, car rentals and trips in American Airlines and affiliated air lines.
While with Visa Business, you can establish up to five authorized users, under one same line of credit, using the same account number. The line of credit can be from $10,000 to $50,000. Besides, you can register this card in the PREMIA® rewards program that allows you to accumulate points which you can later redeem for rewards1.
For its part, with the Visa Corporate product, you have a line of credit of $10,000 and over and each one of your employees can have an individual card with an authorized credit limit. They will have an individual card and will receive their own account statement.
The Popular/AAdvantage® Visa Business and Visa Business cards are products recommended for professionals or small business owners; while the Visa Corporate is ideal for corporations, special partnerships and non-profit organizations.
As you can notice, the characteristics of the commercial cards are very different from those of your personal account. For this reason, the ideal is to have separate accounts because, as Kurt says: “organized accounts preserve wealth”. For more information regarding the commercial credit cards access: www.popular.com/en/business.
The credit cards are subject to credit approval.
1Subject to the terms and conditions of PREMIA® Program (the Program). The Program is optional and entails a $25 annual fee. Membership will be charged annually on the anniversary of the subscription of the Program. The Program is offered by Popular, who may change the format, the components and the terms of any part of the Program or suspend or terminate the Program at any time and without notice. In case of cancellation of the Program by Popular, there will be no reimbursement for accumulated points and they may not be redeemed for prizes. For more information about the accumulation, expiration, use of points and other terms and conditions, please access www.popular.com/premia.