In a typical year, Jared Neff, owner of Neff Yacht Sales in Fort Lauderdale, Florida, travels for work a few times a month. He flies to international boat shows and often takes clients to see yachts for sale all over the world.
Last year, COVID-related international travel bans kept Neff mostly grounded. He took three round-trip domestic flights the entire year and didn’t travel internationally at all. This year, he’s preparing to start hitting the skies again.
“Our business is just like real estate, except the stuff we’re selling moves all over the world,” he says. “When we get a listing, we go to where it is.”
Like any business owner, one of Neff’s focuses is keeping his business costs down, and when it comes to travel, one way he’s found to do that is with a good travel rewards card.
“Trying to buy international tickets at the last minute is a fortune,” Neff says. “But if you have miles loaded up on a card, it can be a lot easier.”
His preferred card, the Delta Premium American Express card, has other valuable perks as well: a free annual companion ticket, a free checked bag, and an easier path to frequent flier status through a combination of accumulated points for spending and miles traveled. Plus, he gets automatic seat upgrades on many flights.
And although Neff likes his current card, he wouldn’t pass up the right offer for a different one—one with a big sign-up bonus, for example.
Neff isn’t the only professional preparing to rack up airline miles again in 2022. The Global Business Travel Association expects business travel to rebound this year, with spending surging 38% to more than $1 trillion.
“People have gotten used to Zoom meetings, but that’s still no substitute for shaking hands and seeing someone in a social setting,” says Howard Dvorkin, a New Jersey-based certified public accountant and chairman of Debt.com. “That being said, they’re still going to evaluate whether travel is necessary.”
With companies dealing with lingering COVID-related uncertainty, supply chain shortages and inflation, those business owners who do decide to travel will be focused on stretching their travel budgets as far as possible.
As Neff has learned, one key to doing that is having a good rewards credit card—and taking advantage of everything it has to offer. The right credit card for your business travel needs will depend on several factors, including the size and maturity of your business, your expense levels and your credit profile.
Here are some tips on choosing the best card for you—and to make sure you’re making the most of it.
#1 Business or personal?
In general, it makes sense for larger companies to stick with business credit cards, but if you’re just starting out—or you’re a sole proprietor—you may consider going with a consumer card. Either way, you’ll want to have a dedicated card for business expenses to make it easier to separate them from your personal spending for accounting and tax purposes.
One of the first questions to answer is whether it makes more sense for you to use a personal or business card to pay for travel and other expenses. Keep in mind that whichever you choose, you, as the business owner, are typically personally liable for the charges, especially if it’s a new business.
The rewards on business credit cards can be more lucrative than those on consumer cards. That said, they don’t always carry the same consumer protections as personal cards. For example, business cards can change the interest rate on an existing balance (consumer cards cannot), and the late fees on business credit cards can be much higher.
Still, opening a business credit card may make sense for young companies with big growth plans for the future.
“If you want to start building credit under the business’ name, a business credit card might be a good way to do that,” says Rob Stephens, founder of CFO Perspective, a company that gives financial advice to small businesses. “Using personal cards for business and personal expenses is not a good idea, even if you think you’re earning more rewards on your personal card.”
Business credit card accounts also make it easier to provide cards to current or future employees, with customized limits on things like amounts or types of expenses.
#2 Consider your spending.
If travel will be a big part of your business this year, you might consider a rewards card tied to either one of the airlines or hotel chains you frequent. The Delta SkyMiles Reserve Business American Express Card, for example, offers triple miles on Delta purchases and additional miles for other eligible purchases. Those extra miles can also make it easier to get back to your frequent flier status if it slipped during the pandemic.
If you expect to also have significant spending in other categories, you might do better with a cashback card, such as the Chase Ink Business Cash card, which earns 5% cash back on office supplies and telecommunication services and 2% on gas. You can redeem the rewards for cash or to help cover travel expenses.
“During the pandemic, many consumers and business owners shifted their cards to get non-travel rewards that were more useful to them,” says Gerri Detweiler, education director for Nav, which supplies free credit research and tools to small-business owners. “They may have shifted to cash back instead of a travel rewards card knowing that they weren’t traveling as much. But now is a great time to re-evaluate whether the card you have is the right one for your business, and whether you’re maximizing your rewards.”
#3 Evaluate sign-up offers.
Card issuers are competing aggressively for new cardholders, both consumers and business owners. The deals for business owners can be more lucrative because credit card companies know that as a group, they tend to spend more than consumers.
“There’s no shortage of options,” says credit expert John Ulzheimer. “If you can’t find a card that meets your business and travel needs, you’re not looking hard enough.”
Before jumping at the first sign-up offer you see, it’s important to understand the terms and conditions of the deal. Typically, for example, you must spend a certain amount of money within a certain amount of time to get the bonus miles or points promised.
“You really have to read the fine print and make sure you’re following the rules to get the benefit of the perk that it’s offering,” Dvorkin says.
Some issuers will waive the annual fee for the first year, but it’s worth noting that cost for the future. Typically, the cards with the richest rewards also come with a higher fee. Even so, a fee of a few hundred bucks can be worth paying for free checked bags and a seat upgrade on even just a few flights.
“People tend to get really offended by annual fees,” Ulzheimer says. “But sometimes they’re not seeing the forest for the trees.”
#4 Understand the perks.
In addition to the miles that can add up to free trips, business travel cards also come with valuable perks that can make travel both more affordable and more comfortable. Access to travel lounges and free Wi-Fi in airports, for example, can make time spent at the airport itself less stressful and more productive, and upgrading to business or first class can make flying a far more enjoyable experience.
Some cards also offer reimbursement for airline fees or foreign transaction fees, free hotel stays, and money toward Global Entry or TSA PreCheck. Cash-back cards often have rotating categories for which you can get extra rewards.
Another pro tip: Sign up for email notifications from your card to learn about (and take advantage of) opt-in programs, such as Chase’s free DoorDash DashPass subscription and American Express Business Platinums, $400 in statement credits toward Dell purchases. Many business card issuers also have opt-in dining programs that reward you for eating at certain restaurants.
If you’re managing multiple cards, Detweiler suggests using an app like AwardWallet or MaxRewards to make sure you’re getting the most out of them.
#5 Don’t carry a balance.
No matter how valuable a credit card’s rewards are, it typically doesn’t make sense to use a rewards card if you can’t pay off your balance every month.
“If you open a rewards card and start carrying a balance, you’re basically self-subsidizing your own reward program,” Ulzheimer says. “And if you pay enough interest, you’re subsidizing the reward program of other people, too.”
If you’re using a credit card for access to capital to start your business, you’re better off looking for a card that has a no-interest introductory offer, rather than one that provides rewards. Have a plan to pay the debt off as quickly as possible, too, because small-business credit cards may impact your personal credit.
#6 Revisit your decision.
Although it’s not always a great idea to jump from card to card every time you see a great introductory offer, you should re-evaluate your business credit card every year or so to make sure it remains a good fit for your business. Over time, the terms of the card may change, and your business will likely evolve, as well.
“Your business needs could change,” Detweiler says. “So periodically you want to review your card and the offers out there to see whether there are opportunities to get rewards aligned with what you need or want.”
Although the return of business travel may be a welcome trend for road warriors like Neff, it can also bring stress (and added expenses) for business owners. The right credit card can be an important tool to minimize that stress and make it easier for you to reap the benefits of those business trips.
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This article originally appeared in the March/April 2022 Issue of SUCCESS magazine. Photo by @DimaBerlin/Twenty20