Cash advances are a convenient way to get cash quickly, but they come with steep fees and high interest rates that can quickly add up. You can get a cash advance at most ATMs or at a financial institution, but it is important to understand the total cost of a cash advance before you take one out. Cash advances are treated differently from typical card transactions and most charge upfront fees that are a percentage of the total cash requested, with a minimal commission if your withdrawal is small enough. Interest rates on cash advances are usually between 20 and 25 percent of APR and there is no grace period during which you can pay your balance without being charged interest.
Before you apply for a cash advance, try using a debit card, payment app, personal loan, or even borrow money from a friend or family member if possible. Cash advances are an easy way to get cash quickly, but they often come with steep fees that outweigh any benefit. Fees to consider in cash advances are the monthly payment, the interest rate on that monthly payment, the cash advance fee (usually 3% or 5% of the total amount of each cash advance you request), and the ATM or bank fee (depending on the method you choose). If you do decide to take out a cash advance, follow the instructions provided at the cashier.
Most credit card lenders offer cardholders the ability to take out a cash advance on their cards. Cardholders can use a credit card at almost any ATM and withdraw cash as they would with a debit card, but instead of withdrawing money from a bank account, cash withdrawal is shown as a charge on a credit card. It is important to remember that interest charges on a cash advance can significantly increase your debt, especially if you have a month-to-month balance on your credit card. We recommend avoiding a cash advance altogether and opting for some alternative options that have better conditions.
Even if you don't carry cash on a regular basis, any small cash transaction can be handled quite easily with peer-to-peer payment apps like Venmo or Square Cash (often called Cash App).Cash advances can be a lifesaver when you need cash, but make sure you understand the total cost of a cash advance before you take one out. A cash advance that is returned promptly should not harm your credit, although cash advances do count towards your credit utilization or the amount of revolving credit you are using towards your credit limits.
