Credit cards are a necessity for any trucking company owner, but they’re also a ticket to debt if you don’t use them wisely. It’s possible to have a Visa card and use it in ways that work to your advantage. With some planning and care, your credit card boosts your credit score and helps your business thrive.
Tips for Using a Credit Card to Benefit Your Company’s Growth
How do you use your credit card to help your business thrive? Here are our tips for smart credit card use.
Research Your Business Credit Score First
Before applying for a card, look into your business’s credit score. If it’s low, you’re going to qualify for a higher interest rate. While this may be unavoidable, it helps to look at your credit report and make sure everything is legit. If it’s not, report any discrepancies or accounts that aren’t yours. This can help increase your score and secure an advantageous interest rate.
If you are stuck with a high-interest rate, make sure you pay off any charges on or before the payment due date. As you make responsible payments, your credit score improves and you can ask for a review to get your interest rate lowered.
Pay Attention to Late Charges and Extra Fees
Suppose you have a cash flow issue and can’t pay your credit card bill. You’re going to get hit with late fees in many cases. Some credit card companies are a bit more understanding, but late fees are always a possibility and add up quickly. Typically, credit card late fees fall in the $15 to $35 range. Late fees may increase if you pay late several months in a row. But, that’s just part of it.
You also have interest charges that add up quickly. If you miss a month’s payment, the next month will include the interest you should have paid the month before plus the interest for the new month. It makes it very easy to keep falling behind. Paying your credit card bill on time, every time, is essential to avoiding debt.
Plus, late payments show up on your credit report after a set amount of time. Most companies report them to credit bureaus when they’re more than 30 days late. However, you might find a company that reports them sooner than that. Always aim to pay on or before the due date. If you’re mailing a payment, make sure the payment is mailed in plenty of time to arrive. Sending it certified gives you added proof that you sent it on time.
What if your client pays late and you don’t have the cash? It’s a good time to look into freight factoring. Get the money you’re owed before you have to pay your bills. When you enter into a freight factoring arrangement, you get paid the same day or within a few days of completing a delivery. You do pay a fee for this advance payment, but at 5% or less, it’s a lot cheaper than credit card interest and late fees.
Don’t Just Pay the Minimum Amount
When you make a charge on a credit card, you’re essentially borrowing from a credit card company, and you need to repay the money you owe. There are two ways to do this. Pay everything in full or make payments. When you make payments, your bill lists a minimum payment, but you’re not restricted to it. You can pay any amount that meets that minimum payment or higher.
If you can’t pay all of your charges at the end of the month, make sure you can pay at least double the minimum payment. When you make a minimum payment, you’re only paying off the interest. The principle (money you borrowed) doesn’t decrease by much at all, so you’ll be paying interest for months or years and getting nowhere.
Take Advantage of Cashback Rewards
Many credit cards have cashback rewards programs where you get a percentage back for certain purchases. Take advantage of these offers. If the Visa card offers 3% cashback on gas purchases, that adds up quickly. The cashback rewards can be applied to your credit card balance and reduce the amount you owe.
Often, the cashback rewards cover purchases like groceries, meals at restaurants, travel expenses on things like hotels, and gas fill-ups. If you’re not sure what the offers are, ask the credit card company’s customer support team for guidance.
Check the Credit Card’s Free App for Features That Protect Against Unwanted Charges
Some credit cards have an app with handy features. Look into them. For example, the SecurLOCK Equip app allows cardholders to monitor payments and manage where purchases are allowed.
The app is Android and iOS compatible and provides the means to restrict certain purchases, which is handy if your employees each have a business credit card. You can keep them from being able to use the card on their day off or at places other than truck stops or gas stations.
Know Your Credit Limits and Current Balance
Pay attention to your credit card limits. You don’t want to charge more than that limit as you face over-balance fees. If you run into financial trouble, consider a small business loan. It offers a low rate and provides the flexibility you need to pay for major expenses like new trucks, major repairs to your business’s HVAC system, etc. Interest rates are much lower, which helps you save money. Keep credit cards for small purchases like gas fill-ups, driver’s meals, hotel fees, and emergency expenses when a driver is on the road.
Sign Up for the Visa Card with Saint John Capital
Several things stand out with the Saint John Capital Visa card. First, you can use it anywhere that Visa is accepted. Second, it’s also available for cash withdrawals and deposits at most ATMs. Here are other benefits.
- Saint John Capital partners with Sutton Bank, which offers the SecurLOCK Equip app.
- You don’t need a personal credit score to apply.
- There are no hidden fees.
- Use your Visa card at the pump.
- There’s a mobile app to help you keep track of spending, payments, and more.
- The Visa call center is open 24/7 if you have issues or questions.
Do you still have questions about the Saint John Capital Visa Card? We’re here to answer anything you still want to know. Reach via email or by phone 24/7 and know that our customer support team is here for you.