October 29, 2024

Best Credit Cards for a Cash Advance in November 2024

06 - The Best Credit Cards for a Cash Advance (Plus Alternatives)@1.5x

If you’ve ever considered turning to a cash advance from your credit card when funds are tight, you’re not alone. In the last quarter of 2022, Americans took out more than $3.5 billion in cash advances.

But what is a cash advance on a credit card, exactly? It’s essentially a short-term loan from your credit card issuer. You can withdraw cash from an ATM or bank using your credit card up to a certain limit.

Cash advances often come with high fees and steep interest rates that start accruing immediately, making them a costly way to borrow money. Before you dive in, learn all about the best credit cards for a cash advance, the pros and cons of this type of loan, and alternative options that may be a lot more cost-effective in the long run.

Pros and cons of cash advance credit cards

When you’re in a financial bind, it’s easy to wonder if you can get cash with a credit card. The short answer is yes. But while it seems like a quick solution, it’s important to understand the pros and cons before you take out a cash advance.

Pros

1. Fast access to cash. If you’re facing an unexpected expense and don’t have enough in your bank account to cover it, a cash advance can provide quick funds.

2. Convenience. You can pick up cash at an ATM, just like with a debit card. You also use your existing credit without having to apply for a new loan or card.

Cons

1. High fees. What is a cash advance fee, exactly? It’s a fee charged by your credit card company when you initiate a cash advance. Most card issuers charge steep fees, which add up if you take out money often.

2. High interest rates. Cash advances usually come with much higher interest rates than regular purchases. If you don’t pay them back right away, you could end up paying even more than you originally withdrew.

3. No grace period. Unlike regular credit card purchases, cash advances don’t have a grace period. Interest charges begin from the transaction date.

4. Lower credit score. Taking out a cash advance increases your credit utilization ratio, which can lower your credit score and make it harder to get loans or credit cards with good terms in the future.

While credit card cash advances might seem convenient at first, they come with serious costs and risks. It’s best to avoid them unless your options are limited and you can pay off the balance quickly.

4 best credit cards for a cash advance

Figuring out how to get a cash advance from a credit card is certainly tempting. If you do go with this option, it’s important to choose a credit card with low fees and a reasonable interest rate. Don’t jump at the first deal you see. Reading the fine print can save you from shelling out more than you can afford.

While cash advances are never ideal, some credit cards are better than others when it comes to minimizing the extra costs. Here are a few of the best credit cards to consider if you need to take out a cash advance:

1. DCU Visa® Platinum Secured Credit Card

The DCU Visa® Platinum Secured Credit Card is unusual in that it doesn’t charge a cash advance fee. And the interest rate for cash advances is the same as the rate for regular purchases. You don’t need amazing credit to qualify, either.

The card’s APR is 16.75%, which is relatively low compared to many other credit cards, especially those designed for people with limited or poor credit history. Keep in mind that this is a variable rate, meaning it can change over time based on market conditions. You might end up paying more later.

A potential drawback if you’re strapped for cash is that this card requires a security deposit of at least $500. While this makes it easier to qualify if your credit isn’t perfect, it’s on the high end for a secured card.

To sign up, you’ll need to join Digital Federal Credit Union (DCU). There are a few different ways to qualify. Double-check your eligibility before submitting an application.

2. PenFed Platinum Rewards Visa Signature® Card

Another card that doesn’t charge a cash advance fee is the PenFed Platinum Rewards Visa Signature® Card. Like the previous card, this is one of the few that charges the same APR for cash advances as it does for purchases — a variable 17.99%.

Like the previous card, you’ll need to join the PenFed Credit Union to get it. But there are no special eligibility requirements other than that.

3. Star One Visa Signature Rewards Card

The Star One Visa Signature Rewards Card doesn’t charge any fees for purchases, cash advances, or balance transfers, making it a cost-effective option for a variety of use cases. The APR is a very competitive 8.75%.

But there’s a catch. You need excellent credit and a minimum credit limit of $5,000. You’ll also need to live, work, or attend school in one of the credit union’s supported areas.

4. Navy Federal Credit Union Platinum Credit Card

This card doesn’t charge any fees for cash advances, balance transfers, or foreign transactions. And one of its main benefits is its low interest rate. The variable APR for purchases and balance transfers ranges from 11.24% to 18.00%, depending on your creditworthiness. The cash advance APR is 2% higher than your variable APR, which is lower than what many other credit cards charge.

But to qualify for this card, you must be a member of Navy Federal Credit Union. Membership is open to active duty military, veterans, their families, and certain civilian employees of the Department of Defense.

6 cash advance alternatives to consider

Before turning to an expensive cash advance, consider these alternative options that are usually more affordable and less risky:

1. Credit cards with 0% intro APR on purchases

These cards allow you to make purchases without accruing interest during the introductory period, giving you time to pay off the balance. This can be a good option if you need to make a big purchase and can pay it off before the intro period ends — usually a few months.

2. Balance transfer credit cards

If you’re struggling with high-interest credit card debt, a balance transfer card might be your lifeline. You can move your debt to a different credit card with lower interest rates, saving you money as you pay it off. These cards often offer a 0% introductory APR on balance transfers for a set period, which is often a year or longer.

3. Earned Wage Access apps

These apps allow you to access your wages before your paycheck arrives. They can help you bridge the gap between earning and receiving your pay without the dangerous high costs and debt traps associated with cash advances or payday loans. For example, EarnIn lets you access up to $150/day or up to $750/pay period with no credit checks, no interest, and no mandatory fees. It could be just what you need to safely cover bills or unexpected expenses.

4. Personal loans

These loans allow you to borrow a lump sum of money and repay it over a set term, usually with fixed monthly payments. Personal loans usually have significantly lower interest rates than credit card cash advances, especially if you have good credit. But they’re usually for higher amounts — and they’re a big commitment.

5. Debt management plans

If you’re struggling with multiple high-interest debts, working with a non-profit credit counseling agency to create a debt management plan could help. These plans can negotiate lower interest rates and consolidate your debts into a single, more manageable monthly payment. That way, you won’t have to seek out cash advances in the future.

6. Borrowing from friends or family

If possible, borrowing from loved ones can provide flexibility and low (or no) interest rates. But it’s crucial to treat the agreement professionally. Be clear about your needs and have a clear repayment plan to avoid damaging relationships if things go south.

Skip the cash advances — access your pay with EarnIn

Life doesn’t wait for payday, and neither should you.

EarnIn lets you access your hard-earned pay as you earn it, whenever you need it, without the high costs of cash advances or payday loans. With our Cash Out tool, you can get up to $150/day or up to $750/pay period, with no mandatory fees, no interest, and no impact on your credit score.

Take control of your finances today with EarnIn.

Please note, the material collected in this post is for informational purposes only and is not intended to be relied upon as or construed as advice regarding any specific circumstances. Nor is it an endorsement of any organization or services.

1. EarnIn is a financial technology company, not a bank. Banking Services are provided by Evolve Bank & Trust, Member FDIC. Subject to your available earnings, Daily Max and Pay Period Max.

2. EarnIn does not charge interest on Cash Outs. EarnIn does not charge mandatory fees for use of its services. EarnIn services may not be available in all states. Restrictions and/or third party fees may apply. For more info visit earnIn.com/TOS.