Having a side hustle is a growing trend, and can be a great way to make extra money outside your full-time job. And with a lot of work and a little luck, your side hustle can become a big business. But even a little extra money can help you pursue passions like travelling or achieve financial goals sooner like buying a home.
Let’s look at some ways your credit card can help make your side hustle a lot easier and more rewarding.
Keeping a Paper Trail
In any business, keeping good records is extremely important. When you’re a salaried employee, it’s pretty simple. You’ll receive a T4 slip from your employer come tax time. However, with a side hustle, you’re responsible for keeping track of your own income and expenses. In terms of expenses, that’s when your credit card can really shine.
By having a separate credit card for your business, it could save you hours of separating your personal and business expenses, not to mention, it will also make life a lot easier if you’re ever audited by Canada Revenue Agency. You’re also less likely to miss valuable tax deductions you’re entitled to.
You’ll still need to hold onto receipts, but a separate credit card for your business sure makes life a lot simpler.
Covering Business Expenses
It takes money to make money, as the saying goes. Most businesses require some out-of-pocked expenses to get starting. By applying for a new credit card specifically for business use, you might be able to take advantage of a few different perks. For starters, look for a handsome sign up bonus – but be sure to understand any qualifiers to get the maximum bonus. You might also earn extra reward points in the first few months or a low introductory interest rate on new purchases. Cash flow may be tight when you’re first starting your business, so be sure to choose wisely.
If your business has ongoing expenses, choose a credit card that offers a higher reward accrual on the expenses you’re likely to spend the most on, helping you put more of your hard-earned money back in your pocket where it belongs.
Doubling Up on Rewards
Whether you’re just starting your side hustle or you’re ready to turn it into a full-time venture, always be on the lookout for opportunities to earn extra rewards. For example, if you’re the driver for a ride sharing service, by choosing a credit card that offers the highest rewards on gas (without a cap), you can help offset your single biggest expense, fuel.
Likewise, if you’re planning to list your property on a short-term rental website and you’re looking to buy some nicer furnishings, you can choose a credit card that will give you a higher rewards accrual on department store purchases.
The Bottom Line
These are just three simple examples of how you can use your credit card to help grow your side hustle. By thinking of your credit card as an asset in growing your business, you can use it to your benefit on your way to achieving side hustle success.
