Secured Business Credit Card

Business Credit Cards – Do You Need Them

Once you start you own business it seems that business credit cards are the next stop. One of the reasons that banks and financial institutions want you to get new business credit cards is because there is because there is so much money to be made from them. A business card has different rules to your personal credit card, they will charge you an annual fee and the interest rate you pay will generally be higher.

Since we all have credit cards in our wallet it seems natural that you should get some for your business. Business credit cards don’t look any different to your personal credit card, which is why I always put a letter or some identifier on my business card. But does your business need them? There are two ways of thinking about credit.

Business Credit Cards

If you have cards you are more likely to use them, so having no access to quick credit reduces temptation
Having a credit card that you use sensibly will improve your company (and personal) credit score which will help when you need to take out a company loan.
Both are correct, when you have a credit card it can be tempting to buy items that you would not normally or maybe go out for dinner at a time when you would not if you couldn’t charge it. But having a credit card that you manage correctly, make regular payments and never miss one, will help improve your credit score. Your credit score will greatly affect the interest rate you pay when you take out any loans.

The other thing to consider is that it is much easier to get a business credit card or a business loan when you are not desperate for one. You also do not have to use a card just because you have it, if you can be sure that you will either not use it or pay off the full balance then having a credit card for business trips or emergencies does indeed make sense.

Credit Card Fees
You need to know that having a card from American express, Citibank or bank of America for your business will require you to pay annual fees. The credit card companies will often waive the charges in the first year so that you get used to using the card and then by the time you get to year two you pay the fees without a second thought. Before you sign up for any credit cards you must think about the fees and the interest rates that you will be charged.

Secured Credit Cards Are A Business Option
One option you may want to consider is getting a secured credit card for your business. You do have to deposit money with the bank, so it ties up some of your capital, and that is used as teh credit limit for your card. You get the benefit of helping your credit score without the risk of over spending. You can only spend up to the amount you deposited so there is no fear of a credit card bill that your company can not afford to pay off.

Use Credit To Grow Your Business
While you may not think you need a credit card or any kinds of loan right now, there may well come a time when your business will need credit and you will be able to get it far easier if you already have a credit history. While I do not love the idea of running up credit card bills I do appreciate that I need my credit score to be as high as possible so that when I need to take out a mortgage or loan I can save money on the interest rate. Business credit cards are a neccessity not an option in my business opinion.

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Everyone Should Start With A Secured Credit Card

Getting your first full time job is an exciting time for everyone and before you know it you start to get your own mail about credit cards, car loans, mortgages and all the other financial things that go into being an adult. It seems like you are not an adult until you have your own credit card, of course the flyers from the bank make it all seem so easy to do. Fill out this form and you are guaranteed your very own credit card in just 14 -21 business days.

The day most teenagers recieve a credit card is the day when trouble starts. When you are in school you learn history, math, geography and maybe you take a business class or two. These classes are all vitally important and may seem to equip you for work, they teach you nothing about real world economics. As we use checkbooks less and less , England is aiming to phase out checkbooks altogether by 2015, there is no real physical trail of what we are spending. If the shop accepts the credit card that is all that matters isn’t it?

credit cards for teenagers

credit cards for teenagers

Credit Cards Are Not Real Money
A credit card is basically a chance for you to get a short term loan when you need it without having to fill in paperwork all the time. You need a tank of gas but don’t get paid for a month, put it onto a credit card. It sounds so easy doesn’t it? The bit that people do not think of is that they still have to pay for the gas. Using a card just defers the payment until the bill comes in. People will often make purchases with credit cards that they would not make if it required cash. While it may feel like you are spending real money at the time, the minute the bill from the card company drops on your doormat it will seem very real.

Secured Credit Cards Teach Fiscal Control
Your own money is used to secure the credit card, so if you don’t pay the bill they still have your money. You can not run your bill up above the amount of cash you deposit, so the actual exposure for you is nothing more than the original deposit. You can see how this is the perfect solution for teenagers. A parent could set up a card with two hundred dollars and give it to their son or daughter. There is little to no real financial risk but the teenager learns how to manage a credit card.

By limiting their exposure to real financial problems you are protecting your son or daughters future but they are still in control of how they spend their money. After a year of two of using a secured credit card sensibly they can jump to a real card and the chances are that they will never go crazy with it. Unlimited credit and lack of impulse control are what causes the real money problems with teenagers. You may not be able to teach them to manage their temprements easily but you can make sure that they do not have access to unlimited credit.

Carrot or Stick
One other thing that I have seen used is the carrot approach. For each month that the bills are paid in full a specified amount is paid into a savings account, with a bonus if they hit it for all 12 months. The stick is that they not only dont get the payment into savings but they will pay interest on the amount that is left on the card. Make sure they understand that they are paying twice and the meal they bought when they couldnt really afford it may have only cost $20 but in reality it has cost a lot more due to the interest and the loss of the carrot payment.

If your monthly carrot payment is $50 then that one meal which they now can’t pay off could well cost them $80+ , sitting down and looking at the math of the situation should scare them into paying the full bill the following month.

Bad Credit Score
It can be hard for a teenager or young adult to realize the implications of a bad credit score. Missing a few payments on a credit card doesn’t seem to be the worst thing that could happen does it? Of course the reality of those missed payments are higher interest rates on car loans, mortgages and store cards. Their car insurance cost may go up and the same goes for home insurance. All because of a few missed credit card payments.

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Credit Cards After Bankruptcy

Credit cards after bankruptcy are not the easiest thing to get but it is perfectly possible if you take some time to prepare. Filing for personal bankruptcy is never a easy choice, but you can come back from it and build a perfectly good credit score over time if you are willing to put in the long term work that is required. To rebuild your credit after bankruptcy you need to take certain steps and be ready for the long haul.

Credit cards are a part of modern life for many people and you will be able to get one again in time but before that happens you need to take some steps and learn some lessons.

  • Take fiscal responsibilty for your self, no one makes you buy anything and many people live without cable TV by choice to save the $70 a month bill that comes with it.
  • Don’t do the same things that got you into trouble before. If you have a big car and a house that you could not really afford do not aim for them again. Do not borrow money to buy items that you do not really need, no one has to have a 48 inch television.
  • Look at your habits. If you smoke or like to drink expensive coffee or wine, you must stop or tone it down dramatically. The less you spend the more chance there is that you will never again need credit.
  • Be honest with yourself. It took you years to get into financial trouble and it is going to take years to get out of it. There is no instant fix for bankruptcy.
  • Do not expect to see a improve credit score overnight, it won’t happen and anyone who tells you that they can repair your credit instantly after bankruptcy is not being totally honest.
Credit Cards After Bankruptcy

Credit Cards After Bankruptcy

Manage your Credit
One of the few ways to get credit cards after bankruptcy after bankruptcy is also one of the best ways to rebuild your credit. A secured credit card will show lenders that you can manage your money effectively and because the card is backed by a deposit of your money there is no risk factor for the bank. You will not be able to get yourself into debt with a secured card from your bank, but no one needs to know that it is not a normal card as they do look exactly the same. As long as you keep paying the card off each month there will be no fees and over time these regular payments can be used to show that you are able to manage your money responsibly again.

Secured Credit Cards
A secured credit card may seem like a crazy idea, if you had the cash to spend you would not need a credit card. A secured credit card is the only type of credit card you will be able to get for a long time after being declared bankrupt.The reason you should get a credit card backed by security is not so you can spend money you do not have but so you can build up your credit rating. If you have been through the process of filing personal bankruptcy you know your credit rating is going to take many years to get back to the desirable level but the sooner you start working on it the sooner you will see a increased score.

Stay Away From Short Term Loans
When you have no money and can not just pull a credit card out of your wallet it can be tempting to take out a short term loan. These are generally known as pay day loans and they are all too often the path to financial disaster. If you miss a payment the interest rate climbs to astronomical rates and it becomes a ball of debt that gets heavier and heavier and at some point becomes almost impossible to pay off.

Every Penny Counts
A wise man once said that what you earn doesn’t matter as much as what you spend. This is especially true for anyone who has been through bankruptcy, the only way you can get truly out of debt and back to life long financial well being is by spending less than you earn. You can do more hours or find a new job to increase your income, but you must think about what you spend. Some people will take a notepad along with them and record every penny they spend, no matter whether it is on a newspaper or a coffee.

It’s No Fun
I know that being declared bankrupt is no fun, you were used to just getting out your credit card whenever you wanted to,  but you can work your way out of it and you do not have to ever go through bankruptcy or money problems again. You are in charge of your own destiny and using a secured credit card as one of your first steps away from bankruptcy is a good move.

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