Qualifying for business credit cards
One of the best ways to rack up even more points and miles is by applying for business credit cards in addition to personal credit cards. We know, we know…you’re skeptical because you don’t own a business!
Not so fast. Our goal today is to break it all down by explaining how the process works and dispelling the common misconceptions along the way. Read on to understand why business cards are the “secret sauce” of award travel and how you can add them into your own strategy.
Applying for business cards without a “traditional business”
Many people don’t realize that they may qualify for a business credit card, even without owning a traditional business. You don’t need an LLC or an EIN number, you don’t need to earn much business income, and you don’t need to have any employees. Any type of side hustle or freelance work can qualify as a business for the purposes of opening a business credit card. It’s way easier than it sounds.
Some examples of side hustles that can qualify are:
Selling used items on eBay, Facebook Marketplace, Craigslist, etc.
Consulting work
Babysitting
Dog walking
Tutoring
Driving for Uber or Lyft
Selling your concert or event tickets
MLM sales
This is just the tip of the iceberg. Any income you earn outside of your traditional W2 can qualify as a business for the purposes of opening a business credit card.
The Pros of Business Cards
So, what’s so great about business credit cards? Why would you ever want to open one? There are a few reasons.
Most business cards don’t count toward your 5/24 status. This means that you can easily sprinkle in business card applications between your personal card applications without your 5/24 status being affected. Having said that, you do need to be under 5/24 status to be approved for any Chase business card. If you don’t know about the Chase 5/24 rule, it’s super important in the game of award travel! Read all about it in our blog post.
Note: The few business cards that do count toward your 5/24 status are the Discover and TD Bank business cards, plus the Capital One business cards (aside from the Capital One Venture X Business and Capital One Spark Cash Plus accounts).
Business cards typically come with higher welcome bonuses compared to personal cards, making them a really effective tool for racking up points.
There are a lot of business cards out there! So again, it’s easy to rack up those points and miles if you choose to make business cards part of your award travel strategy.
The Cons of business cards
Business cards tend to have a higher minimum spend than personal cards. Some folks time their business card applications with an upcoming expense that would make meeting the minimum spend fairly easy (think home renovations, car maintenance, tax bills, property insurance, medical expenses, etc.)
The banks may ask for additional information regarding your business prior to approving you for a new card (usually verifying your home address or social security number if you’re applying as a sole proprietor). It’s rare that this happens, but worth mentioning.
FAQs
How do I apply if I don’t have a “traditional business” with an EIN?
You can apply for a business card as a sole proprietor using your social security number. And you would enter your business name as your legal name (first and last).
What if I have a very small side hustle and it only makes a few hundred dollars per year?
This isn’t a problem. Data points show that a business income as low as ~$250/year can result in a credit card application approval. Just because your business doesn’t make a lot of money, it doesn’t mean you can’t be approved for a business credit card.
What if I don’t have many business expenses? What charges do I put on the credit card?
Based on our research, it’s common to put personal expenses on a business credit card in order to meet the minimum spend. Note: If you do have a “traditional business,” it’s important to track your business expenses vs. your personal expenses for tax purposes. Keep in mind, this is not financial advice and ultimately, you should only do what makes you comfortable.
Business card recommendations
If you’re ready to apply for a business card, the family of Chase Ink cards are our absolute favorite! We’d appreciate it so much if you use our referral link. Here are our favorite three options:
The Chase Ink Business Preferred card currently has an increased welcome offer: 120,000 Chase Ultimate Rewards (!) if you spend $8,000 in three months. It has a $99 annual fee, but that is more than worth for 120,000 of our favorite points which are flexible and transferrable! (Note that you have to “scroll” to the right to see the Chase Ink Business Preferred card option from our referral link.)
The Chase Ink Business Unlimited will get you 75,000 Chase Ultimate Reward points if you spend $6,000 in three months. It has no annual fee! It also gives you 1.5% cash back (which can be converted to Ultimate Rewards) on all purchases. This makes it a good “no brainer” card if you don’t want to be bothered with credit card earning categories.
The Chase Ink Business Cash will get you 75,000 Chase Ultimate Rewards if you spend $6,000 in six months. It has no annual fee! It gives you 5% cash back (which can be converted to Ultimate Rewards) on purchases at office supply stores. (Random?? Hint: Did you know you can buy almost any gift card at places like Office Depot and Staples?)
Using our Chase Ink referral link won’t cost you anything, but it gives us a few referral points to add to our stash. Thank you in advance!
Conclusion
Considering business cards don’t count toward your 5/24 status and there are so many of them available with high welcome bonuses, they can really increase your points and miles earning potential over time! Award travel is certainly still possible without opening business cards, but it’s much more lucrative with them.
If you’re interested in learning more about how to complete a business card application as a sole proprietor (i.e., without having an EIN), let us know and we’ll share our research.
We’re here if you have any questions!
❤️ Liz
Friendly reminder: We are not financial advisers, we are simply sharing our method and approach with you. Of course, it's important to use credit cards responsibly. Pay off your balance in full each month to avoid interest charges, and never spend more than you can afford just to earn rewards.
