How To Get Cash From Your Credit Card

Quick answer

• Credit card cash advances offer immediate funds but come with high fees and interest rates.
• Consider a cash advance only for true emergencies when no other options are available.
• Understand the fees, interest rate, and repayment terms before proceeding.
• Explore alternatives like personal loans or borrowing from savings first.
• Be aware that cash advances do not typically earn rewards points.
• Plan to pay back the advance quickly to minimize interest charges.

Who this is for

• Individuals facing an unexpected and urgent financial need.
• Those who have exhausted all other readily available cash sources.
• People who understand and accept the high costs associated with credit card cash advances.

What to check first (before you act)

Goal and timeline

Before considering a cash advance, clearly define why you need the money and when you need to repay it. Is this a one-time expense, or a recurring need? Knowing your repayment timeline is crucial for managing the high costs of cash advances.

Current cash flow

Assess your current income and expenses. Can you realistically afford to repay the borrowed amount, plus significant fees and interest, within a short period? A detailed look at your budget will reveal if a cash advance is sustainable.

Emergency fund or safety buffer

Do you have an emergency fund? If so, using it is almost always a better and cheaper option than a credit card cash advance. If not, consider building one to avoid such high-cost borrowing in the future.

Debt and interest rates

Review all your existing debts. If you have high-interest debt, a cash advance will only add to your financial burden. Compare the interest rate of a cash advance to your other debts to understand the full impact.

Credit impact

Taking a cash advance itself doesn’t directly hurt your credit score. However, if you struggle to repay it, the missed payments will negatively impact your score. Also, a cash advance increases your credit utilization ratio, which can lower your score.

Step-by-step (simple workflow)

1. Assess the necessity:

• What to do: Honestly evaluate if this is an absolute last resort.
• What “good” looks like: You’ve explored all other options (savings, family loans, selling items) and a cash advance is truly the only way to meet an urgent need.
• Common mistake: Rushing into it for non-essential purchases or without exploring alternatives. Avoid this by stepping away for 24 hours to reconsider.

2. Identify your credit card’s cash advance limit:

• What to do: Check your credit card agreement or log in to your online account.
• What “good” looks like: You know the maximum amount you can withdraw.
• Common mistake: Assuming it’s the same as your overall credit limit. Avoid this by verifying the specific cash advance limit.

3. Understand the fees:

• What to do: Locate the cash advance fee percentage and any flat fees.
• What “good” looks like: You know the exact fee amount or percentage charged per transaction.
• Common mistake: Not realizing there’s often both a percentage fee and sometimes a minimum flat fee. Avoid this by reading the fine print of your cardholder agreement.

4. Determine the interest rate (APR):

• What to do: Find the specific cash advance APR. It’s often higher than your regular purchase APR.
• What “good” looks like: You know the exact interest rate applied to the borrowed amount.
• Common mistake: Assuming the cash advance APR is the same as your purchase APR. Avoid this by checking your card’s terms; they are usually different and higher for cash advances.

5. Note the grace period (or lack thereof):

• What to do: Confirm if there’s a grace period for cash advances. Typically, there isn’t.
• What “good” looks like: You understand that interest starts accruing immediately.
• Common mistake: Believing you have a grace period like with purchases. Avoid this by knowing that interest usually begins on the transaction date.

6. Choose your withdrawal method:

• What to do: Decide if you’ll use an ATM, a bank teller, or a convenience check.
• What “good” looks like: You’ve selected the most convenient method for your situation.
• Common mistake: Not realizing some methods might incur additional fees (e.g., using a non-network ATM). Avoid this by checking for any ATM-specific fees.

7. Withdraw the cash:

• What to do: Follow the instructions for your chosen method to get the cash.
• What “good” looks like: You have the funds you need in hand.
• Common mistake: Withdrawing more than you absolutely need. Avoid this by taking only the precise amount required.

8. Create a repayment plan immediately:

• What to do: Designate funds to pay back the advance as quickly as possible.
• What “good” looks like: You have a concrete plan to repay the principal plus fees and interest.
• Common mistake: Treating it like a regular purchase and making only minimum payments. Avoid this by prioritizing its repayment to cut down on interest.

9. Make a payment:

• What to do: Pay back the borrowed amount, ideally more than the minimum, as soon as possible.
• What “good” looks like: You’ve made a substantial payment or the full amount to minimize interest.
• Common mistake: Waiting for the statement due date to make a payment. Avoid this by making an early payment if possible to reduce the interest calculation period.

10. Monitor your credit card statement:

• What to do: Review your statement to ensure all fees and interest charges are accurate.
• What “good” looks like: Your statement accurately reflects the cash advance, fees, and any payments made.
• Common mistake: Not checking for errors or unexpected charges. Avoid this by reviewing your statement carefully each month.

Common mistakes (and what happens if you ignore them)

Mistake	What it causes	Fix
Using for non-emergencies	Unnecessary high fees and interest charges, increasing debt.	Treat cash advances as a true emergency tool only; explore all other options first.
Ignoring the cash advance fee	A percentage of the withdrawn amount is immediately lost, increasing the total cost.	Factor the fee into the total amount you need to repay.
Not knowing the cash advance APR	Interest accrues at a higher rate than regular purchases, leading to much larger debt.	Always verify the specific cash advance APR; it’s often significantly higher.
Assuming a grace period exists	Interest starts accruing from day one, making the debt grow faster than expected.	Understand that cash advances typically have no grace period; interest begins immediately.
Making only minimum payments	The principal balance shrinks very slowly, and you pay a substantial amount in interest over a long period.	Pay back the advance as quickly as possible; aim to pay more than the minimum to reduce interest.
Withdrawing more than needed	You pay fees and interest on money you didn’t actually require, increasing your overall debt.	Withdraw only the exact amount you need for the emergency.
Not checking for ATM or network fees	Additional charges from the ATM operator or your bank can increase the cost of the advance.	Use ATMs affiliated with your credit card issuer or your bank whenever possible.
Not factoring in rewards (or lack thereof)	You miss out on earning rewards points or miles, which you might have received with a regular purchase or debit.	Be aware that cash advances generally do not earn rewards.
Not having a repayment plan	The debt can linger, accumulating significant interest and becoming difficult to manage.	Create a strict repayment schedule immediately after taking the advance.
Not monitoring statements for errors	Incorrect fees or interest charges can go unnoticed, leading to overpayment or further debt.	Review your credit card statements carefully after taking an advance to ensure accuracy.

Decision rules (simple if/then)

• If you have an emergency fund, then use it instead of a cash advance because it’s interest-free.
• If a non-essential purchase arises, then do not take a cash advance because the fees and interest are too high.
• If your credit card’s cash advance APR is above a certain threshold (e.g., 25%, check your card terms), then strongly reconsider because the cost of borrowing will be very high.
• If you can get a personal loan with a lower interest rate, then take the personal loan instead of a cash advance because it will be cheaper to repay.
• If you can borrow from a family member or friend with no interest, then do so because it’s the cheapest option.
• If you need the money for longer than a few weeks, then a cash advance is a bad idea because the interest will quickly become unmanageable.
• If your credit card has a cash advance fee of 5% or more, then avoid it if possible because that’s an immediate significant cost.
• If you can sell an asset (like electronics or jewelry), then consider selling it to get cash instead of taking a cash advance because you avoid borrowing costs.
• If you are already struggling with credit card debt, then do not take a cash advance because it will worsen your financial situation.
• If you can delay the expense until you save the money, then wait and save because it’s the most cost-effective approach.
• If you absolutely must take a cash advance, then plan to pay it back in full within one billing cycle to minimize interest.

FAQ

What is a credit card cash advance?

A credit card cash advance is a service that allows you to withdraw cash using your credit card. You can typically do this at an ATM, a bank teller, or by using convenience checks provided by your card issuer.

How much does a cash advance cost?

Cash advances typically involve a cash advance fee (often a percentage of the amount withdrawn, with a minimum fee) and a higher Annual Percentage Rate (APR) than your regular purchases. Interest usually starts accruing immediately, without a grace period.

Are there alternatives to cash advances?

Yes, there are usually better alternatives. These include using your emergency fund, borrowing from savings, asking friends or family, taking out a personal loan, or exploring a balance transfer if you have existing credit card debt.

Will a cash advance hurt my credit score?

Taking a cash advance itself doesn’t directly lower your score. However, if you fail to make timely payments on the advance, it will negatively impact your credit. Also, it increases your credit utilization ratio, which can indirectly lower your score.

Can I earn rewards on a cash advance?

Generally, no. Most credit card issuers do not offer rewards points, miles, or cashback on cash advance transactions. This makes them less appealing from a rewards perspective.

How do I get a cash advance from my credit card?

You can typically get one by using your credit card and PIN at an ATM, visiting a bank with your card and ID to request the advance, or by cashing a convenience check provided by your credit card company.

How quickly does interest start on a cash advance?

Interest on cash advances usually begins to accrue from the moment the transaction occurs. Unlike regular credit card purchases, there is typically no grace period before interest starts being charged.

What is the difference between a cash advance and a balance transfer?

A cash advance is withdrawing cash directly. A balance transfer is moving existing debt from one credit card to another, often to take advantage of a lower introductory interest rate. Both can have fees and specific terms.

What this page does NOT cover (and where to go next)

• Specific details on credit card cash advance limits and fees for all issuers (check your cardholder agreement).
• Legal implications of defaulting on credit card debt (consult a legal professional or credit counselor).
• Advanced debt management strategies for severe financial distress (seek advice from a certified credit counselor).
• How to build a robust emergency fund (explore budgeting and savings guides).
• Detailed comparisons of personal loan providers (research reputable financial institutions).