If you’re a business owner, you know that expenses can quickly add up, from office space and web hosting to shipping, salaries, and payments to contractors. While these costs are often necessary for growth and success, it’s crucial to be strategic with your purchases. Traditionally, savvy business owners might comparison shop, buy generic options, or bulk-order necessities to save money. However, one often overlooked aspect of smart spending is how you pay for these expenses.
Over the past few years, major banks like Chase, American Express, and Capital One have introduced attractive business credit cards that earn lucrative rewards points. These points can be redeemed for travel, including flights, hotels, and upgrades, providing significant value for businesses with travel expenses. Additionally, many business cards offer valuable benefits like purchase protection, rental car damage waivers, and travel insurance, which can positively impact your bottom line.
In this comprehensive guide, we’ll explore how credit card points and miles can benefit your business, explain why earning them is essential, and provide a beginner’s strategy for jumpstarting your rewards-earning journey. We’ll also delve into sample redemptions and share tips on how to maximize your points and miles further.
Why Businesses Need Travel Rewards Credit Cards
The primary reason many businesses opt for a travel rewards credit card is to earn points or miles on everyday purchases. Most business credit cards earn rewards on every purchase, from flight tickets and office snacks to computer equipment. Depending on your monthly spending, this can help you accumulate a significant number of points or miles.
Additionally, some cards offer bonus points or miles in specific categories. For example, the Ink Business Preferred® Credit Card earns 3x points per $1 spent on the first $150,000 spent annually on travel, shipping, internet, cable, phone services, and advertising with social media sites and search engines. This equates to up to 450,000 extra Ultimate Rewards points per year, enough for multiple business-class flights worldwide.
Transferable points currencies like Chase Ultimate Rewards, American Express Membership Rewards, and Capital One miles offer the best value when redeemed for premium travel, such as business-class flights or hotel suites. By transferring points to airline and hotel partners, you can take advantage of sweet spots and get significantly more value than redeeming for cash back or travel booked through a portal.
Other Reasons Your Business Needs a Credit Card
While earning travel rewards is a primary reason for obtaining a business credit card, there are other compelling benefits:
1. Budgeting and Purchasing Power: Business credit cards allow you to plan purchases and make purchases while waiting for invoices to be paid, providing more flexibility than a debit card.
2. Employee Spending Management: Many business cards let you add employee cards for free, making it easier to track employee spending, set limits, and streamline expense reporting. Plus, you’ll earn points on employee purchases.
3. Purchase Protection: Many business cards offer protection from loss, theft, and damage for a certain period after purchase, providing peace of mind when buying expensive equipment.
READ ALSO: Best 0% APR Business Credit Cards for 2024: Maximizing Your Interest-Free Period
Different Types of Business Credit Card Rewards
Business credit cards can earn three types of rewards: transferable points, airline/hotel points, or cash back. Let’s explore each type:
1. Transferable Points – The Most Flexibility and Rewards: Transferable points, such as Chase Ultimate Rewards, American Express Membership Rewards, and Capital One miles, are our favorite type of credit card rewards for businesses. These points can be redeemed for cash back, travel booked through the card issuer’s portal, or merchandise. However, the best value comes from transferring points to airline and hotel loyalty programs to book premium travel.
For example, you can transfer 90,000 Ultimate Rewards points to Virgin Atlantic Flying Club and book a round-trip business-class ticket from the U.S. West Coast to Tokyo on partner airline All Nippon Airways (ANA).
2. Airline and Hotel Points – Limited Flexibility, More Perks: Co-branded airline and hotel credit cards earn points or miles specific to that loyalty program. While less flexible than transferable points, these cards often come with valuable perks like free checked bags, lounge access, and elite status benefits.
We recommend pairing a co-branded card with a transferable points card. Use the transferable points card for everyday spending and the co-branded card for its benefits when flying or staying with that airline or hotel.
3. Cash Back – Cash Can Be King (For Some Businesses): While cash-back rewards are generally less lucrative than transferable points or airline/hotel points, they can still be valuable for businesses that don’t travel often. The earned cash back can offset business costs and improve your bottom line.
Different Types of Transferable Points
As mentioned, there are three major transferable points currencies for businesses: American Express Membership Rewards, Capital One miles, and Chase Ultimate Rewards. Each has its unique set of transfer partners, offering various redemption opportunities.
American Express Membership Rewards: Membership Rewards points can be earned with cards like The Business Platinum Card® from American Express and the American Express® Business Gold Card. These points can be transferred to partners like Avianca LifeMiles, British Airways Avios, and Virgin Atlantic Flying Club.
Capital One Miles: Capital One miles are the newest addition to transferable points. They have an impressive list of transfer partners, including some exclusive to Capital One, like Turkish Airlines Miles&Smiles and EVA Infinity MileageLands.
Chase Ultimate Rewards: Ultimate Rewards points can be earned with cards like the Ink Business Preferred® Credit Card, Ink Business Cash® Credit Card, and Ink Business Unlimited® Credit Card. Ultimate Rewards partners include United Airlines, Southwest Airlines, Hyatt, and more, offering excellent redemption options.
Where to Start – The Ultimate Rewards Strategy
We highly recommend starting with Chase Ultimate Rewards cards for several reasons:
1. Chase’s 5/24 Rule: Chase’s 5/24 rule restricts people from opening new Chase cards (including business cards) if they’ve opened five or more new credit cards in the past 24 months. Starting with Chase cards ensures you don’t miss out on lucrative welcome bonuses.
2. Valuable Transfer Partners: Chase Ultimate Rewards has exclusive transfer partners like United Airlines and Hyatt, offering outstanding redemption opportunities.
3. Ink Business Preferred Card: The Ink Business Preferred® Credit Card is an excellent starting point, with a generous welcome bonus, 3x points per $1 on select business categories, and valuable benefits like cell phone insurance and purchase protection.
Once you’ve obtained the Chase cards you want, you can explore American Express and Capital One business cards to diversify your points-earning strategy.
The Best Chase Credit Cards to Start With
1. Ink Business Preferred® Credit Card: Earn 100,000 bonus points after spending $8,000 on purchases in the first three months. Earn 3x points per $1 on the first $150,000 spent on travel, shipping, internet, cable, phone services, and advertising with social media sites and search engines each account anniversary year. Annual fee: $95.
2. Ink Business Cash® Credit Card: Earn up to $750 cash back (which can be converted to Ultimate Rewards points) after spending $7,500 on purchases in the first three months. Earn 5% cash back on the first $25,000 spent at office supply stores and on internet, cable, and phone services each account anniversary year. No annual fee.
3. Ink Business Unlimited® Credit Card: Earn $750 cash back (which can be converted to Ultimate Rewards points) after spending $7,500 on purchases in the first three months. Earn 1.5% cash back on every purchase with no limits or categories to track. No annual fee.
Getting Started With Earning Points for Your Business
Once you’ve obtained your first business credit card, meet the welcome bonus spend requirement by putting as many business expenses as possible on the card. This could include rent, contractor payments (via a service like Plastiq), cell phone bills, internet and cable costs, software subscriptions, and business travel expenses.
If you’re still struggling to meet the minimum spend, consider prepaying expenses like office utilities, internet, and electricity, or bulk-ordering office supplies and snacks.
Using Your Hard-Earned Ultimate Rewards Points
Now that you’ve accumulated points, let’s explore some fantastic redemption options:
1. Domestic Business Flights on American Airlines: Transfer Ultimate Rewards points to British Airways Avios and book domestic American Airlines flights for as little as 9,000 Avios one-way (up to 1,151 miles). This is a great option for last-minute or expensive business routes like Chicago to New York or Charlotte to Toronto.
2. Fly to Europe in Style on SkyTeam Partners: Transfer points to Air France/KLM’s Flying Blue program and book business class flights to Europe for as little as 53,000 miles one-way from the U.S. Recent searches found a one-way ticket from New York to Paris to Dublin for just 53,000 miles and $223 in taxes/fees.
3. Take Your Family to Hawaii From the West Coast: Transfer points to Singapore Airlines KrisFlyer and book economy flights from the West Coast to Hawaii for just 24,000 miles round-trip on partner airline Alaska Airlines.
4. Check Singapore Suites Off Your Bucket List: Fly in Singapore Airlines’ famous Suites first class by transferring 97,000 Ultimate Rewards points for a one-way ticket from New York to Frankfurt, or 148,500 points for New York to Singapore.
5. Fly First Class to Tokyo on All Nippon Airways (ANA): Use Virgin Atlantic Flying Club (a transfer partner) to book ANA first class from the U.S. to Tokyo for just 120,000 miles round-trip, or business class for 90,000 miles.
Other Ways to Maximize Points and Miles on Business Expenses
In addition to using business credit cards, there are several other strategies to earn more points and miles on your regular business expenses:
1. Join Corporate Airline Rewards Programs: Airlines like American, Delta, United, and JetBlue offer corporate rewards programs that let businesses earn points or miles on employee travel without impacting personal earnings.
2. Use Shopping Portals for Business Purchases: Earn bonus points, miles, or cash back on online purchases by clicking through airline, hotel, or credit card shopping portals before making a purchase.
3. Enroll in Dining Rewards Programs: Many airline and hotel loyalty programs offer dining rewards that let you earn points or miles when dining at participating restaurants, cafes, and bars.
4. Earn Extra Cash Back With the Dosh App: Link your business credit cards to the Dosh app and earn bonus cash back at select merchants, including stores, restaurants, and rideshare services.
5. Enroll Your Visa Business Cards in Visa SavingsEdge: Earn automatic statement credits on purchases from select merchants by enrolling your Visa small business cards in the Visa SavingsEdge program.
6. Earn Bonus United Airlines Miles With the MileagePlus X App: Use the MileagePlus X app to instantly buy gift cards for supported merchants and earn bonus United miles on purchases made with those gift cards.
7. Take Advantage of Chase Offers and Amex Offers: Chase and American Express offer periodic statement credits or bonus points when you make purchases with select merchants after adding the offer to your card.
8. Book Client-Reimbursable Hotel Rooms Through Rocketmiles: Earn bonus airline miles on hotel bookings by using the Rocketmiles platform, which is especially lucrative for client-reimbursable stays.
Conclusion
As a business owner, earning points and miles on your expenses can provide significant value, offsetting travel costs, upgrading your experiences, and potentially even funding employee incentives or family vacations. By strategically using business credit cards and implementing the strategies outlined in this guide, you can maximize your rewards-earning potential and enjoy the numerous benefits that come with being a savvy points and miles collector.
Remember, the key is to start with the Chase Ultimate Rewards ecosystem, taking advantage of the valuable Ink Business cards and their lucrative welcome bonuses. From there, you can diversify your earnings by exploring other transferable points currencies and co-branded airline and hotel cards.
Ultimately, earning points and miles should be a priority for any business owner looking to stretch their budget and create unforgettable experiences for themselves, their employees, and their clients. By incorporating these strategies into your business operations, you’ll be well on your way to unlocking a world of travel possibilities.
Frequently Asked Questions (FAQs)
Q: What is the Chase 5/24 rule?
A: The Chase 5/24 rule prohibits people who have opened more than five new credit cards in the past 24 months from opening new Chase personal or business credit cards. This is why we recommend starting with Ink Business cards first.
Q: What business credit card should my business start with?
A: We recommend most businesses start with the Ink Business Preferred® Credit Card due to its generous welcome bonus, valuable bonus categories, and perks like cell phone insurance and purchase protection.
Q: What happens after I spend $150,000 in the Ink Business Preferred card’s bonus categories?
A: You’ll earn 1x point per $1 spent in those categories after reaching the $150,000 annual cap. The bonus categories are travel, shipping, internet, cable, phone services, and advertising with social media sites and search engines.
Q: Can I transfer Ultimate Rewards points to American Airlines?
A: No, American Airlines AAdvantage is not an Ultimate Rewards transfer partner. However, you can book American Airlines flights by transferring Ultimate Rewards points to British Airways Avios.
