Are you searching for ways to get cash quickly? Many credit cards offer cash advances which can be very beneficial. However, there is a right way and a wrong way to use a credit card cash advance. Of course you want to be sure to use your cash advance the right way! Take a look at how to take advantage of a cash advance and use it in the best way.
What is A Cash Advance?
Most cash advances are very simple to get. You just take your credit card to any ATM and request cash. The ATM give you the cash and the debt goes on your next credit card bill. Easy as that! Many credit cards will have a cash advance limit and even if you may have a $1000 credit card limit, you may not be able to get $1000 cash. Higher interest rates and fees may also apply to your cash advance which is something to consider when thinking about using a cash advance to pay for something.
Know The Cost
While you may think that a cash advance will just cost you the amount of cash you withdrawal, that is incorrect. To begin, there is typically a cash advance fee that can range from 3-5% or a set amount of $5 or $10 dollars per cash advance. On top of this, the interest rate on a cash advance will likely be higher than your usual credit card interest rate. While most credit card purchases will accrue interest at the end of a billing cycle (unless paid in full), a cash advance will start accumulating interest immediately. Before slipping your credit card into an ATM, be sure you know what the true cost of that cash will be. You may only get $100 out of the machine but you will owe much more.
Despite the cost associated with getting a cash advance, there are times when you may want to use this version of a small quick loan. One time is when you have a situation come up where you need to pay someone who doesn’t accept credit. A plumber, babysitter or landscaper are all examples of people who may not accept a credit card but still need to be paid! If you don’t have cash in the bank but need these services, use a cash advance to get the job done!
There may be a tie when you are in a foreign country and need to get cash in the form of the local currency. If you are unable to find a bank, a credit card in an ATM will help you get the cash you need and continue on with your travels. This can definitely be worth the extra cost if it means your trip will be a little easier as you can access cash as needed.
Pay Back Quickly
If you do use a cash advance, be sure to pay it off as soon as possible. The high interest will continue to accrue so the faster you pay, the better off you will be! If you need cash quickly but know you can pay it back soon, a cash advance may help you.
Cash advances do have their advantages and times when they can be used but you should assess you options and know the terms of the advance before you start withdrawing lots of money. Think about asking friends or family for cash or look into a quick personal cash loan. There are many alternatives out there that will get you the cash you need!