Is A Credit Card Cash Advance Worth It?

There are many bells and whistles that come with every credit card. One of the most common perks is the ability to get a cash advance on your card. But is this “perk” really worth it?

One of the most common perks of many credit cards is the ability to go to an ATM and get cash that will just be added to the balance of your credit card. Some of these cards even come with a few checks attached to the card for this purpose as well.

This may seem like a simple and convenient perk but it can quickly become a huge problem if you rely on it too much. Your best bet is to simply never use this perk in the first place.

Here are the reasons why cash advances are not all they're cracked up to be...

Fees

If you get a cash advance on your credit card you will most likely have to pay a fee upfront, somewhere between $5 and $10. This is before interest and before the ATM fees themselves. You could easily be paying $10 just in fees from your credit card company and the ATM before even having money in hand.

High Interest Rates

When you take out a cash advance on your credit card you are charged a higher interest rate for that amount. The average interest rate on a cash advance is a whopping 23.68 percent. 

In addition, cash advances have no grace period and will start accruing interest the second the debt is added to your account.

Easy To Become A Habit

If you start getting cash from your credit cards you may find it too easy and continue to do it. With the high fees and interest rates you can easily rack up a ton of debt just from getting a little cash here and there. You are far better off just paying for whatever you need with your credit card than by taking out cash from that same card.

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