Should You Get a Business Credit Card? | Assisted Living Business Tips
Feb 26, 2025
Managing finances is a big part of running a successful assisted living business. One key decision is whether to get a business credit card. A good business credit card can help with cash flow, track expenses, and even earn rewards. But if not used wisely, it can lead to debt and financial trouble. Let’s explore the pros and cons to help you decide if a business credit card is right for your assisted living business.
Check out the video too:
Why a Business Credit Card Can Be a Smart Choice
1. Protects Your Business from Fraud
A business credit card keeps your bank account safe. If fraud happens, you can dispute the charges without risking your business funds.
2. Builds Business Credit
Using a business credit card responsibly can boost your business credit score. A strong credit profile helps when applying for loans to expand your facility.
3. Offers Flexible Spending Limits
You can issue employee cards with spending limits. For example, you can set a $6,000 limit for an administrator and a $500 limit for a house manager to control expenses.
4. Rewards and Cash Back
Many business credit cards offer cash back or travel rewards. This can save money on assisted living expenses like groceries, office supplies, or business travel.
5. Helps with Cash Flow
Credit cards give you extra time to pay for expenses, which is helpful if revenue fluctuates. Just be sure to pay off the balance before interest kicks in.
The Downsides of a Business Credit Card
1. Depends on Personal Credit
If your business is new, approval depends on your personal credit score. A hard inquiry can lower your score temporarily.
2. High Interest Rates
Most business credit cards charge interest rates between 13% and 25%. Carrying a balance can quickly add up and hurt your bottom line.
3. Security Risks with Employee Cards
Giving employees access to business credit cards can lead to misuse if not properly monitored. Regularly review spending and set clear policies.
4. The Debt Trap
It’s easy to overspend, especially with tempting rewards programs. If you can’t pay off your balance in full each month, interest charges can wipe out any benefits.
Is a Business Credit Card Right for You?
Yes, if:
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You pay off balances in full each month.
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You want to build business credit.
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You need to track and manage expenses efficiently.
No, if:
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You struggle with credit card debt.
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You won’t be able to pay off balances regularly.
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You don’t need extra cash flow management.
Tips for Using a Business Credit Card Wisely
âś… Pay Off Your Balance Each Month: Avoid high-interest charges.
âś… Monitor Employee Spending: Set limits and review transactions regularly.
âś… Don’t Overspend for Rewards: Interest charges can wipe out any perks.
âś… Use It to Build Credit: A strong credit profile can help secure loans for future expansion.
Final Thoughts
A business credit card can be a great tool if used wisely. It helps with cash flow, earns rewards, and builds business credit. However, high-interest rates and spending risks make it essential to manage responsibly.
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Show full transcript 👇
Transcript
00:00:01
finding the right banking institution for your small business is extremely important you'll want to take time a lot of time to figure out exactly what your needs are and finding a banking institution that meets your needs the same goes for a business credit card but first you need to answer this question is a business banking credit card right for me hi everybody i'm brandon gustafson i own and operate two assisted living facilities and i created this channel to help people like you learn
00:00:29
the ins and outs have been investing in assisted living welcome to assisted living investing [Music] hey everybody welcome back to the channel in our last video we talked about uh small business banking fees that you should be aware of and uh just kind of look out for uh so go ahead and watch that video leave a comment uh there if you have you know additional insight into some fees that you should be aware of or things that i miss i'd love to hear from you on that today we're going to get
00:01:08
into the question of should i get a business credit card there's a lot of good and bad with credit cards and so we're going to talk a little bit about that today so obviously there are perks of having a business credit card some of those perks are they can give you some additional protection so you don't have fraud on your actual business bank account which is nice credit cards are also unsecured debt so that means you haven't put like real estate up against it or your car or so there's no collateral there
00:01:40
it's unsecured and and so you just have a little bit more um i don't know protection um from that uh in in the event that you go bankrupt or or something like that um so you know you're not going to lose your house or something like that if you um default on on a credit card because it's unsecured um but it's higher interest rate so that's something else you want to look at um you can get multiple cards for multiple users and you can put specific limits and protections on each of those cards
00:02:11
you can get a lot of great customization for each of those cards for the different people so as an owner i can have a card that just has access to everything i can do whatever i need to with it and i can give one to my administrator that has a spending limit of i don't know six thousand dollars a month and if i needed to give it to uh like our house manager because she's gotta go and buy supplies or things like that i could make one on there that has like a 500 a month limit or something like that or
00:02:40
you could only buy stuff at these types of locations or things like that you can put a lot of customization on there to help keep track and make sure that people aren't spending money that they aren't supposed to um using a business card for personal expenses and also that you're just able to control a little bit more there so that customization is great that you can get on on those credit cards you can earn cash back and other partner rewards and i'm going to have a video about that
00:03:11
here in the in the near future but those are some really great perks you can use the those rewards and things for things like travel or lodging subscriptions supplies you can get good deals on that a lot of credit card companies will create relationships with those types of vendors so you can really take advantage of that through their partner reward programs you can start building your business credit which is going to be helpful as you look to continue building out your portfolio and you can also kind of float
00:03:42
your money a little bit that's something else that a lot of people don't talk a lot about with credit cards you still want to be wise with it and how you do it but you can kind of float um transactions for you know a month um or if you really needed to you could kind of hold things on a credit card for a period of time just swallow the interest and make sure you're doing that especially in the beginning as you're starting your business it might be something that you need to do to float
00:04:08
groceries for six weeks on there while you're trying to get your operating capital up and running the way that you need it to be so that's another perk that a lot of people don't talk about with credit cards and as long as you don't do it to perpetually get into debt i mean you're using it strategically it's a great way to kind of float things around and give you a little bit more time to pay bills or things like that so why you would not want a business credit card these are the reasons that
00:04:39
you look at a credit card and you're like ah nope can't do it i'm going to just stick with our debit card or something like that so in the beginning with no business credit the credit poll is going to be using your personal credit and that can impact the amount of credit you receive based off of of your personal credit so if you don't have great personal credit the chances of you getting a high limit business credit card is is not great um it's going to be hard to do that it's also because they're doing a bump a
00:05:10
pull on your personal credit they uh it's going to impact your personal credit score so that's another thing that you kind of want to be aware of as you're starting out with the business that you know it's going to be based off of your personal credit so just take that into consideration high interest rates is the next one we've talked about this a little bit briefly earlier in the video but credit card interest is extremely high you know 13 to 25 or something like that like
00:05:40
it's it is not a low interest loan at all it is one of the worst types of debt that you can use you can still use it you can still leverage it um but you just want to make sure that you're aware that you're paying a very high interest rate um to to do that um so if you're looking uh you know if you're not good at doing credit cards in your personal life then i would say probably avoid doing a credit card in the business unless you've got a business partner that is really good
00:06:09
with it that's kind of some of the pros of of working with business partners um you know you just don't want to get yourself into extra debt um that's that's not good you don't want to put yourself in a really bad situation with your business because you ha now have you know five business credit cards that have ten thousand dollars of debt on each of them like that would just kind of ruin your business so you don't want to do that um even though it is unsecured debt i i would just highly
00:06:35
suggest that you stay away from it um because you're going to be paying a lot of money in interest and you could avoid that if you just use the debit card for your purchases so if you're not good at using personal your personal credit card then you might consider staying away from a business credit card uh business credit cards typically are also going to have less protection than like a bank in the in the event that there's fraud or or something like that um yeah there are there's protection in
00:07:07
place for uh a credit card it's something that you can look at um and see but typically a bank is going to have a little bit better protection and be able to help you out with that a little bit more for fraud and those types of things so just kind of be aware there that you might have better protection if you just go with your banking institution and you also might run into some security issues especially if you have multiple employees that have a card in a small assisted living facility like the
00:07:36
one that i have we just have our administrators who have a card and we keep pretty good tabs on on how those are being spent but if you are a larger facility and you've got managers and those people all have cards and you know you're managing six seven eight cards it can get a little a little dicey there and it can be a little hard to keep track of everything and so you just want to make sure that if you are doing that you're dealing with the security issues of somebody using it for personal expenses
00:08:07
on the card getting lost or stolen you just have more cards out there and so your risk is higher and there are there's potential for more security issues to come up so just something you want to be aware of so yes or no should you should you get a credit card or not and as with most things that i talk about on this channel it really just depends if you are a responsible user of credit cards and then you have some really great potential to earn rewards build business credit float some of your payments use
00:08:38
this this tool wisely and you know if you're planning on paying that card off quickly and using it kind of like a debit card um then yeah i would say go ahead and do it business cards are probably a good fit for you they're a good idea we use them we pay them off once twice a month like we're very good at staying on top of them it's something that i'm able to do in my personal life as well so it's not something that for me is is scary and there's a lot of good perks for it
00:09:09
uh like i think we'll be able to use our points from one of our cards to go and do a site visit at one of our facilities with no out-of-pocket costs which will be great so there's a lot of perks for that um and i'll again i'll get into that in a in a future video but if you struggle with personal credit cards um you're likely going to be struggling with a business credit card as well so in that case i would probably say no again this is your decision um so do what you need to do
00:09:36
but it's probably best if you just kind of keep things simplified just use a debit card for your transactions and kind of keep it in that space within your bank don't have too many balls in the air just kind of keep it simple for you as you continue to grow and build and gain more confidence in how you're doing things then maybe you could start introducing a credit card but if you're not great at doing them i would probably steer clear of them but again it's up to you the perks of using a credit card are
00:10:05
certainly great but remember you still need to use them responsibly uh the perks are not worth putting yourself in a difficult situation don't get caught up in the points of the reward system uh thinking oh this is gonna be great and then you're you end up paying a thousand two thousand dollars a year in an interest like that's not worth it doesn't matter how many points you get you're probably not earning that many points and that many perks um just by spending your card so just kind
00:10:33
of make sure that you're aware of everything there don't put yourself in a difficult situation uh with your finances and don't put yourself more in debt or anything like that just be wise in how you use your credit cards as a tool for your business is is what i would suggest to you there next time we're going to be getting into how do you get a business credit card what's the process for doing that how do you go and apply for them some strategies there so i'll get into that a
00:10:57
little bit more in the next video um if the credit card is right for you then make sure you watch that video and and learn kind of what that process is and we'll start getting into rewards and things like that to learn more about investing in assisted living make sure you visit me on assistedlivinginvesting.net i have free content free resources out there you can set up a consulting call with me i'd love to have a conversation with you and then make sure you follow me on my other social media platforms
00:11:23
i'd love to have continued conversations there and just interact with you and remember it doesn't take a lot just a little bit keep going step by step by step if you are consistent you're going to make progress and i promise you are going to be successful so keep it up thanks for watching [Music] you
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