Some businesses today are using credit cards to help finance new purchases, pay vendors, and add employees, but what happens if those credit cards don’t get paid off, or your business needs a larger line of credit? You might think credit cards and charge cards are one and the same. Both cards are borrowing money from an issuing company based on your income and information on your credit report. Both credit cards and charge cards is a means of buying goods and services on credit. But this is where the similarities between them end.

How much cash would you save/make if you didn’t have to pay business expenses for a month? Imagine this scenario. Your company spends $50k/month on marketing.  Instead of paying by check or credit card, you pay with a charge card.  Depending when in the billing cycle your card is charged, you could then have more than a month to pay off the amount on the card.  By pushing off your payments, you kept $50k in cash in your checking account.

Businesses are using charge cards to extend their cash flow without incurring longer term debt. Sometimes a cash flow cycle is longer and the short term funding from a charge card offers purchasing power as your business evolves.

With a credit card, you have a spending limit. Business owners “borrow” this money from the issuing credit card company and have the option to either pay back the amount borrowed in full or by installments with added interest each month.

Charge cards on the other hand, do not have the option of making payments over an extended amount of time as credit cards do. A charge card is a means of making a purchase in a very short-term –it doesn’t offer you a revolving line of credit, you must pay the balance in full during a single billing cycle, but there is not a pre-set spending limit.

So Which One is Better?

Both have their advantages and disadvantages, it all depends on what the consumers are looking for and which card is a better fit for their business. Borrowers who make timely payments without being late can eventually raise their credit scores, saving money on insurance and acquire loans from financial institutions when needed down the future.

Credit cards give the flexibility for business owners to pay back in increments, giving them time to come up with the money they borrowed to pay back their credit card balance. But this flexibility could be a double edge sword as well. With no specific time limit, the borrowed balance could accumulate a with hefty interest that could make it harder for consumers to pay back later on.

You can’t carry a balance with a charge card the way you can with a credit card. Partially paying off what you may owe on a charge card could result in a costly late fee, as much a 5% of your balance, and possibly restrict your usage of the card or canceled all together. But since there is no “loan,” there is no interest accumulated in a charge card, unlike a credit card. And unlike a credit card, charge cards often comes with additional services and benefits, such as: free roadside assistance, free food at airports, free hotel upgrades and many more. The Gold Card from American Express gives travel reward points for every dollar spent (in addition to other discounts on purchases), so in the example above, you also probably earned enough points for a free round trip flight and hotel for your next business trip.

Didn’t go to Stanford for your MBA? Well, now you can. Top notch universities in the US and abroad, business schools, museums, public broadcasting stations and state education organizations are all part of YouTube EDU, Academic Earth, MIT Open Course Ware and iTunes U which offer free downloads of educational podcasts or videos. These presentations cover a range of topics from VoIP security forums to language courses. iTunes U is the most popular platform for these free downloads. iTunes U’s popularity is most likely attributed to its promotion of free and mobile learning. Although released in 2007, not many users are maximizing its true potential. iTunes U has the prospective of creating a more empowered business person.

How it works:

iTunes U is accessed through iTunes and is found at the top of the menu bar. The podcasts can be downloaded individually or you can subscribe for automatic downloads as they become available. This second feature is used primarily for an on-going series podcast which operates like an on-going course.

How to Use it:

iTunes U’s direct relationship with iTunes means podcasts can be watched or listened to through a computer or can be taken anywhere with an iPod or an iPhone. iTunes U can be accessed from mobile devices through their cellular networks and via Wi-Fi. When accessing iTunes U from a computer, you can even send the podcast to your employees to ensure they are also up-to-date with current technologies or business concepts.

Whether your company is trying to break into a new industry, revamp your company logo or stay current with trends, there is probably a lecture for it.

Here is an exaggerated hypothetical situation illustrating how to utilize iTunes U to improve your business:

A small business owner is deciding between a social media focused online marketing campaign or a direct mail campaign. From listening to some iTunes U lectures, he decides that an online marketing campaign would be best and could be part of a larger search engine optimization effort. This savvy businessman decides to learn more about online marketing strategies before hiring anyone. After several lectures, he hires an experienced graphic design firm familiar with techniques referenced in the podcasts. He managed to do all of this free research on his iPod while on his daily subway commute to work each day.

As with the hypothetical example above, listening to these lectures may not illicit the necessary skills to do the project yourself, but will create a more knowledgeable entrepreneur. This knowledge creates a more confident negotiator and may eliminate the need to outsource more basic projects. Whether trying to learn Spanish to attract new clients or learn about social networking sites, with over 200,000 free educational files available through iTunes U alone, not taking advantage of this educational opportunity is too expensive of a mistake to make.

At the start of this week, California workers will notice their paychecks are slightly smaller. In July, California legislature passed a plan to falsely increase state revenue until June by increasing the Personal Income Tax withholding by 10%. Technically this is not an increase in the personal income tax as any extra withholding will be returned in April, it is a matter of when personal income tax is paid. This increased withholding is being referred to as an “interest free loan” and will serve as a $1.7 billion cash advance for the government through next June. However, the timing matches right up with the holiday season. Will the withholding reduce holiday shopping?

The government argues that it will have a minimal impact on people’s income, with an income reduction of only about $10-$45 a month. The problem is, for California families living paycheck to paycheck, this “minimal” reduction is huge. CareerBuilder reports that 61% of US workers generally live paycheck to paycheck. However with this year’s Labor Day decline in sales and with Labor Day being considered a sales indicator for the upcoming holiday season, the withholding measure may lead to tighter wallets for California shoppers. California’s increased withholding, coupled with the other tax increases this year, makes Californian’s disposable income smaller and smaller. (Other impacts this year: sales tax increased by one percent, state income tax increased by .25 percent and dependent credit was reduced by two-thirds).

Who is affected most by this?

Local California business, particularly those in counties with higher unemployment rates, such as Riverside County with a September unemployment rate of 14.7%, might sharply feel the increased withholding tax. It is possible that people will use credit cards more this holiday season as an attempt to compensate for a lack of cash. Credit card processing capabilities may play a large factor in holiday shopping profits this year for areas with higher unemployment rates.

Companies who employ ecommerce web design for their websites and have developed their online marketing and search engine optimization efforts will be in a more comfortable place this holiday season. Websites with shopping carts will grant these businesses access to out-of-state customers unaffected by the increased personal tax withholding.

Get around the increased tax withholding measure:

People can change their personal withholding allowances through their employers or payroll services provider with the Employment Development Department’s DE4 form. The legislature is hoping most will not be wise to this technique.

In today’s economic environment, individuals with entrepreneurial mindsets are exploring new ideas for businesses that will not only survive in a recession, but will also thrive. The key to starting a new business is maximizing its resources while remaining lean in operations. Let’s face it: most people do not have $100,000 sitting in their pockets. So, how is it possible, then, to start a business with a minimal amount of capital? The good news is that there are literally hundreds of business concepts that can be created with less than $5,000 in start-up costs.

Businesses under $1,000

Yes, believe it or not, it is possible to start a business under $1,000. According to BusinessTown.com, there are 82 business categories that do not require more than $1,000 in start-up fees. For example, to become a Merchandise Demonstrator, start-up costs are estimated between $500 and $1,000. However, earnings can rest between $20,000 and $35,000 per year. This business requires a person who has garnered a network of business contacts to demonstrate products for one or more specific companies at trade shows and seminars. This business can be learned first by handing out samples at grocery stores, which typically pays up to $50 per day. By beginning here, the person has a launching point from which to establish relationships with larger corporations, with the ultimate goal of merchandising their products. Other examples of inexpensive businesses under $1,000 entail Lawn Care Services, Toy Cleaning and Repairing Services, Reminder Services, Professional Organizers, Motor Vehicle Transportation, and Roommate Referral Services.

Businesses between $1,000 and $5,000

The good news is that there are literally hundreds of business concepts that can be created with $5,000 or less. As reported by the aforementioned online source, 136 businesses cost between $1,000 and $5,000 in start-up fees. Most of these concepts only require a phone, desk, and a few other tools such as a list of established contacts and a passionate drive to build a steady pipeline. Some of the more interesting businesses that stood out include a Resume Service Provider, a Mobile Hair Salon, a Meeting Planner, a Mover, a Window Washing Service, a Vending Machine Owner, Flower and Tree Cutting and Trimming Services, and Speechwriting Services. Now, these are only eight of the 136 businesses listed, but are businesses that may appeal to a larger number of entrepreneurs, than the more concentrated, niche-targeted businesses such as an Adoption Search Service firm.

The antiquated notion that a business cannot be started without a large lump sum of money is no longer the reality. Many businesses today have flourished based off of lean operations and low start-up costs. Today’s world does not require every type of business to begin its first day in operations out of a 10-story office building with leather couches and a glitzy waiting room. Companies can start out of one’s home and see immediate results. Entrepreneurial expert Bonny Alpo, who has owned her own copywriting service since 2005, reports that the least expensive business concepts revolve around pet care, home care, and delivery and moving services.

There’s no excuse for not being able to start your own small business either as a full time effort or start off part-time until it grows.