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7 Alternatives for Credit Card Cash Advances

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7 Alternatives to Cash Advances on Credit Card Cash Advances

Cash advances are expensive. They’re an option if you’re in a bind, but take a look at your options first.

by Kimberly Palmer Senior Writer/Spokesperson | Personal finance, budgeting, family finances Kimberly Palmer is a personal expert in finance at NerdWallet. She is also the author of three books on finances “Smart mom, Rich Mom,” “The Economy of You” and “Generation Earn.” Kimberly’s work is published on .

as well as Funto Omojola as Lead Writer Auto loans and credit cards Funto Omojola started writing for NerdWallet in 2020. Before joining NerdWallet, she covered topics related to personal finance for financial organizations and websites and has over five years of experience in writing about money. Her writing has been featured by MarketWatch, Yahoo Finance, Realtor.com, New York Post as well as Nasdaq, among other publications. Funto obtained her bachelor’s degree in global and international studies and the MFA at Bard College. She is based in Brooklyn, New York.

Dec 1, 2022

Editor: Erica Corbin Assistant Assigning Editor Erica Corbin joined NerdWallet in 2020 as an assistant assigning editor at large. She has previously written and edited material for companies such as GOBankingRates and Nasdaq. The work she wrote was published on USA Today, Yahoo Finance, MSN and more. She has also worked as an editor and freelance writer for more than a decade with different publications and clients across different industries. Erica holds a bachelor’s level degree in English literary studies at Seattle Pacific University.

The majority or all of the items featured on this page are from our partners who compensate us. This influences which products we write about and the location and manner in which the product appears on the page. However, this does not influence our opinions. Our views are our own. Here is a list of and .

Taking out a on your credit card might sound appealing. You’ll have quick access to cash, which could be used to purchase groceries or pay rent.

But there are significant downsides for cash advances, such as fees that tend to be high , and the interest starts growing immediately. There’s often a cap on the amount you are able to withdraw however, and it’s usually less than your overall credit limit.

While they may be a feasible option- and a better option to take out a cash advance should be utilized only as a last resort if you are facing financial hardship.

Before you pull one out, consider these options:

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1. Low-interest or 0% intro APR credit cards

Some credit cards have zero percent intro APR on purchases. This means that you can pay for the purchase of groceries and other essentials , without paying interest upfront. Of course, you’ll owe the money, but you’ll have a significant period of time which can be anywhere between six months and nearly two years to pay it back in full before the interest starts to accrue.

By taking advantage of the, for instance it is possible to avail of a two-year break from interest. It gives you an APR that is 0% at the beginning on purchases for up to 21 month and the option of a zero-introductory APR for Balance Transfers of up to 21 months after the date of account opening for qualifying balance transfers. Then, the current APR of 17.49%-29.49% Variable APR .

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2. 3. Credit card loan programs

Some credit card issuers offer loans to existing customers which can, among other things permit them to pay specific purchases over time, and for the cost of. Examples of this are and features.

Similar to that, Citi offers a and Chase also has . These programs permit customers to borrow money at a lower cost than what they get with the cash advance, and also to pay it back over the course of.

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3. Payment services from third parties

If you need to buy the time between your next pay day, you might look into a service to cover a few bills. The site allows you to utilize a credit card pay for expenses that aren’t otherwise able to be paid in this way, including rent, utilities and day care. For the 2.9 per cent service fee, Plastiq will charge your card for the bill, send a check out to the vendor in your name and mail it to them.

In the event that you are able to pay the balance quickly — that is, without carrying it over to the next month, and then being hit with your credit card’s double-digit rate of interest — a 2.9% convenience charge may be worth it and could be less expensive than other options. If you’re using a rewards credit card to pay the bill, it can aid in paying for the upfront fee.

4. Buy nowand pay later for services

It’s sometimes not feasible to cough up a large amount of money in one time, whether you’re cash-strapped or not. Companies, such as Affirm, Afterpay and Klarna, allow users to divide purchases into smaller payments that can be paid over time — typically anything from 3 to 12 months.

While some BNPL options come with interest rates and fees which can be expensive If you’re capable of paying the bill in a short period of time they could provide an easier and more flexible way to pay for your financial obligations.

It is crucial to remember, however, that BNPL is provided only by particular merchants. So if you need cash fast to pay rent or buy groceries such as, for instance, the services may not provide you with the needed cash.

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5. Options for credit cards with flexible options

There are some that offer flexible and less costly financing options that cash advances. For instance, the zero -annual-fee allows holders to use their credit limits for personal loans. Customers can pay back the amount they borrowed in equal monthly installments with an interest rate fixed.

Alternative credit cards are typically more accessible to people who may not be able to qualify for more typical credit card. That’s because many of them don’t rely solely on typical credit scoring models when determining the eligibility. The cards that are eligible comprise that (issued by ) the, and the .

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6. Personal loans

There are a myriad of types of loans, which are backed by collateral, as well as unsecured loans, which aren’t. Some come with fixed rates, meaning that you have the same monthly payment each month until the loan is fully paid back Some lenders offer variable rates, meaning that the amount you pay can alter over time. Rates typically range between 5% and 36 percent.

While the rate of interest is still relatively high, it is lower than a cash advance in particular when you consider the other costs involved in taking one out which is usually a flat fee or a percentage of the amount you withdraw.

7. Alternative ‘quick cash’ options

If you’re facing a dire financial situation and require more immediate funds, here are a few quick solutions to get some relief:

Cash out your rewards If you own a credit card with an incentive program for cash-back it is possible to redeem your rewards for an amount of money.

You can request an advance from your paycheck: Although a cash advance on your credit card could be costly and risky and costly, soliciting your employer to grant an advance of your pay can be a way to cover your financial requirements without incurring any fees or charges.

Get help from local sources There are many local organizations that provide financial aid to those who are facing hardships. Local organizations that are likely to assist you could comprise religious institutions, non-profit groups, or community centers.

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About the authors: Kimberly Palmer is a personal finance expert with NerdWallet. She has appeared on the “Today” show as well as on The New York Times.

Funto Omojola is Auto loans writer for NerdWallet. Her work has been featured by MarketWatch, Yahoo Finance and Nasdaq.

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