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How to Make Your Budgeted Business Expenses Cheaper

June 20, 2018
4 min read
How to Make Your Budgeted Business Expenses Cheaper
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Putting as many business expenses as possible on a rewards credit card has the net effect of making your operating expenses cheaper if you put the rewards back into your business. Your travel expenses may shrink by 3% or more if you use the right credit card, while you could save 5% on office supplies and advertising when you choose a card that includes this type of spending in its bonus categories.

One example is The Business Gold Rewards Card from American Express, which earns 3 points per dollar on one category from a list of five options — airfare purchased directly from airlines, US purchases for advertising in select media, US purchases at gas stations, US purchases for shipping and US computer hardware, software, and cloud computing made directly from select providers — up to $100,000 per year. Another is the Ink Business Cash Credit Card, which pays 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable and phone services each account anniversary year (then 1%).

Unfortunately, you can't put everything on a credit card — including some of your biggest monthly expenses like rent, contractor payments and vehicle lease payments. You can, however, run these budgeted expenses through an online payment service like Plastiq, which allows you to pay for things you normally wouldn't be able to with a credit card. (Plastiq cuts a check or initiates a bank transfer to the recipient.)

Among the expenses Plastiq says you can pay for with its service are several that are likely part of your monthly business budget, including car payments, contractors, insurance, legal services, rent and utilities.

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Paying these recurring expenses with Plastiq normally wouldn't produce any savings for you or your business, as Plastiq charges a 2.5% transaction fee on all credit card payments. That fee is more than you're likely to earn in rewards for using your card. It's why we typically recommend that businesses and consumers put these expenses on a credit card only if they need to boost spending to earn a sign-up bonus or to hit an annual bonus.

But the service is waiving its fee on transactions up to $250 if you use Masterpass to initiate a Plastiq payment. Fees will be waived for payments delivered through September 30, 2018. Although Masterpass supports non-Mastercard products, the Plastiq promotion is good only on Mastercard-branded cards used through Masterpass.

This is both good news and bad news, as there are fewer restrictions on Mastercard cards than there are for other processors, like Visa, which cannot be used on Plastiq to make mortgage payments. However, not many of the top business credit cards are branded as Mastercard. Two notable exceptions are:

  • The CitiBusiness / AAdvantage Platinum Select World Mastercard, which pays 1 AAdvantage mile per $1 spent on non-bonus category purchases, which is how Plastiq payments would be coded. AAdvantage miles are worth 1.4 cents apiece, according to TPG's latest valuations.
  • The Bank of America Business Advantage Travel Rewards World Mastercard credit card, which pays 1.5 points for every $1 spent on all purchases everywhere.

The information for the CitiBusiness AAdvantage Platinum card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

If you have one of these cards, putting these expenses through Plastiq — at least for now — is something of a no brainer, particularly for expenses less than $250. You can also stack payments of $250 to the same recipient and avoid the fees, as long as the person or business you're sending the money to is OK with receiving multiple partial payments over several days — for instance, mortgage processors are often not willing to accept partial payments.

Another Way to Save

After the Plastiq promotion ends (or if you don't have a Mastercard-branded card), you may still be able to save money by putting your payments through the online service, especially if cash flow is an issue. Talk to your vendors about early-pay discounts. You may be able to shave a couple percentage points off your costs — and not have to worry whether the money is in your business bank account immediately to pay that bill.

Featured image by Getty Images

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TPG featured card

Best for the well-traveled foodie
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review
Apply for American Express® Gold Card
at American Express's secure site

Rewards

3 - 4X points
4XEarn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S.
4XEarn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
3XEarn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.

Intro offer

60,000 bonus points
Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.

Annual Fee

$250

Recommended Credit

670-850
Excellent/Good
Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

There's a lot to love about the Amex Gold card. It's been a fan favorite during the pandemic because of its fantastic rewards rate on restaurants (that includes takeout and delivery in the U.S.!) and U.S. supermarkets. If you're hitting the skies soon, you'll also earn bonus points on travel. Paired with up to $120 in Uber Cash (for U.S. Uber rides or Uber Eats orders) and up to $120 in annual dining statement credits at eligible partners, there's no reason that the foodie shouldn't add this card to their wallet. Enrollment required.

Pros

  • 4x on dining at restaurants and U.S. supermarkets (on the first $25,000 in purchases per calendar year; then 1x)
  • 3x on flights booked directly with the airline or with Amex Travel
  • Welcome bonus of 60,000 points after spending $4,000 in the first six months

Cons

  • Weak on travel outside of flights and everyday spending bonus categories
  • Not as useful for those living outside the U.S.
  • Some may have trouble using Uber/food credits
  • Few travel perks and protections
  • Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.
  • Earn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S., and earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
  • Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
  • $120 Uber Cash on Gold: Add your Gold Card to your Uber account and each month automatically get $10 in Uber Cash for Uber Eats orders or Uber rides in the U.S., totaling up to $120 per year.
  • $120 Dining Credit: Satisfy your cravings and earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, Milk Bar and select Shake Shack locations. Enrollment required.
  • Choose the color that suits your style. Gold or Rose Gold.
  • No Foreign Transaction Fees.
  • Annual Fee is $250.
  • Terms Apply.
  • See Rates & Fees
Apply for American Express® Gold Card
at American Express's secure site
Terms & restrictions apply. See rates & fees
Best for the well-traveled foodie
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

4XEarn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S.
4XEarn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
3XEarn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
  • Intro Offer
    Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.

    60,000 bonus points
  • Annual Fee

    $250
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    670-850
    Excellent/Good

Why We Chose It

There's a lot to love about the Amex Gold card. It's been a fan favorite during the pandemic because of its fantastic rewards rate on restaurants (that includes takeout and delivery in the U.S.!) and U.S. supermarkets. If you're hitting the skies soon, you'll also earn bonus points on travel. Paired with up to $120 in Uber Cash (for U.S. Uber rides or Uber Eats orders) and up to $120 in annual dining statement credits at eligible partners, there's no reason that the foodie shouldn't add this card to their wallet. Enrollment required.

Pros

  • 4x on dining at restaurants and U.S. supermarkets (on the first $25,000 in purchases per calendar year; then 1x)
  • 3x on flights booked directly with the airline or with Amex Travel
  • Welcome bonus of 60,000 points after spending $4,000 in the first six months

Cons

  • Weak on travel outside of flights and everyday spending bonus categories
  • Not as useful for those living outside the U.S.
  • Some may have trouble using Uber/food credits
  • Few travel perks and protections
  • Earn 60,000 Membership Rewards® points after you spend $4,000 on eligible purchases with your new Card within the first 6 months of Card Membership.
  • Earn 4X Membership Rewards® Points at Restaurants, plus takeout and delivery in the U.S., and earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1X).
  • Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
  • $120 Uber Cash on Gold: Add your Gold Card to your Uber account and each month automatically get $10 in Uber Cash for Uber Eats orders or Uber rides in the U.S., totaling up to $120 per year.
  • $120 Dining Credit: Satisfy your cravings and earn up to $10 in statement credits monthly when you pay with the American Express® Gold Card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, Milk Bar and select Shake Shack locations. Enrollment required.
  • Choose the color that suits your style. Gold or Rose Gold.
  • No Foreign Transaction Fees.
  • Annual Fee is $250.
  • Terms Apply.
  • See Rates & Fees