The main ways to get cash from a credit card
You can get cash from a credit card through a cash advance, which is a short-term loan against your credit limit. The card issuer gives you the money at an ATM, bank branch, or through a balance transfer to your bank account. Unlike a purchase, a cash advance starts charging interest when ready — there is no grace period — and the interest rate is usually higher than your purchase rate.
A second method is a balance transfer to your checking account. Some cards offer this as a feature; you request the transfer through your online account or by phone, and the issuer deposits funds directly into your bank. This is still a cash advance in function, even though the mechanics feel different.
A third option is to use your credit card at a cash-back ATM or to request cash back when you make a purchase at a store. These are technically cash advances too, though some cards charge lower fees for ATM withdrawals than for over-the-counter cash advances.
Key Takeaways
- Cash advances charge interest from day one, with rates typically 3 to 5 percentage points higher than your purchase rate, and fees of 3 to 5 percent of the amount withdrawn.
- You can withdraw cash at an ATM, request it over the counter at a bank branch, or have it transferred to your checking account, depending on your card's terms.
- The total cost of a $500 cash advance can easily reach $50 to $75 in fees and interest within the first month if you do not pay it back quickly.
- Paying back a cash advance does not reduce your credit card balance as fast as a regular payment would, because the issuer applies payments to the lowest-interest debt first.
How much a cash advance actually costs
A cash advance has three costs: the upfront fee, the interest rate, and the speed at which interest compounds. The upfront fee is usually 3 to 5 percent of the amount you withdraw — so a $500 advance costs $15 to $25 before you even leave the ATM. Some cards charge a flat fee instead, such as $5 or $10, which is cheaper for large withdrawals but more expensive for small ones.
The interest rate on a cash advance is not the same as your purchase rate. Most issuers charge 2 to 5 percentage points more for cash advances. If your purchase rate is 18 percent, your cash advance rate might be 23 percent. Interest accrues daily from the moment you withdraw the money, with no grace period. A $500 advance at 23 percent costs about $9.58 in interest in the first month if you make no payment.
The real trap is how payments are applied. When you pay your credit card bill, the issuer applies your payment to the lowest-interest debt first — usually purchases — and the cash advance sits there accruing interest. If you have both purchases and a cash advance on the same card, your payment reduces the purchase balance before it touches the cash advance. This means you can pay $200 toward your bill and still owe nearly all of the cash advance interest.
Where and how to withdraw cash
You can withdraw cash at any ATM that displays your card's logo — Visa, Mastercard, American Express, or Discover. The ATM will ask whether you want a cash advance or a balance transfer; choose cash advance. You will see the fee amount before you confirm, so you can cancel if the cost surprises you. Most ATMs allow withdrawals up to your available credit, though some cards set a lower daily or monthly limit.
You can also walk into a bank branch — yours or any other — and request a cash advance over the counter. The teller will process it the same way an ATM does, and you will pay the same fee. Some people prefer this method because they can ask questions and see the fee clearly before completing the transaction.
A balance transfer to your bank account works differently. You log into your credit card account online or call the issuer's customer service line and request a transfer to your checking account. The money usually arrives within one to three business days. You still pay the cash advance fee and the higher interest rate, but you avoid the ATM step. Some cards offer a lower fee for balance transfers than for ATM withdrawals, so check your terms.
When a cash advance makes sense
A cash advance is expensive enough that you should only use one if you have no other option and can pay it back within days. The main legitimate use case is a true emergency — a car repair, a medical bill, or an urgent expense — when you have no savings and no access to a personal loan or line of credit.
Even then, the math matters. If you need $500 and can pay it back in two weeks, the total cost is roughly $25 in fees plus $3 in interest — about $28, or 5.6 percent of the amount borrowed. That is expensive, but it is not catastrophic if the alternative is a late payment on something else or a payday loan, which costs far more.
If you cannot pay back the cash advance within a few weeks, the cost spirals. A $500 advance at 23 percent interest costs $95 in interest alone over three months if you make no payment. Add the upfront fee and you have paid $120 for a $500 loan — a 24 percent cost in three months. At that point, you should look for a personal loan, a line of credit, or a balance transfer card with a 0 percent introductory rate instead.
Alternatives that cost less
A personal loan from a bank or credit union usually charges 6 to 36 percent interest, depending on your credit score, and has no upfront fee. The interest rate is fixed, so you know exactly what you will pay. A $500 personal loan at 15 percent over six months costs about $40 in interest — less than half the cost of a cash advance.
A 0 percent balance transfer card lets you transfer a balance from another card and pay no interest for 6 to 21 months, depending on the card. You pay a balance transfer fee of 3 to 5 percent upfront, but after that, interest is zero. This works well if you have an existing credit card balance you want to move, not if you need new cash.
A credit line from your bank or credit union, if you have one, usually charges less interest than a cash advance and lets you draw money as you need it. If you do not have one, you can open one before an emergency happens — the process takes a few days to a week, and the line sits unused until you need it.
A payday loan is more expensive than a cash advance and should be a last resort. A typical payday loan charges $15 to $20 per $100 borrowed, which works out to 400 percent annual interest. A cash advance, despite its flaws, is cheaper.
How a cash advance affects your credit
A cash advance does not directly hurt your credit score the way a missed payment does. However, it does increase your credit utilization — the percentage of your available credit you are using. If you have a $5,000 credit limit and you take a $500 cash advance, your utilization jumps from 0 to 10 percent. High utilization can lower your score by a few points, though the effect is temporary and reverses once you pay the balance down.
The real credit damage comes if you cannot pay back the cash advance and it sits on your card for months. Late payments, high balances, and interest charges all hurt your score over time. The cash advance itself is not the problem; the debt it creates is.
Frequently Asked Questions
Can I use a credit card cash advance to pay another bill?
Yes. You can withdraw cash and use it for any purpose — rent, utilities, medical bills, or anything else. The issuer does not restrict how you spend the money. However, the cost is the same regardless of what you use it for, so the question is whether the expense is worth the fee and interest.
What is the difference between a cash advance and a balance transfer?
A balance transfer moves debt from one card to another; a cash advance gives you new cash. Both charge interest from day one and both cost money upfront. Balance transfers are useful if you have existing debt on another card; cash advances are for when you need new money.
Will my credit card company let me withdraw my full credit limit as a cash advance?
Most will, but some cards set a lower cash advance limit — for example, 50 percent of your credit limit. Check your card's terms or call customer service to find out your limit before you go to the ATM.
How long does it take to pay off a cash advance?
That depends on your payment. If you pay $100 per month on a $500 cash advance at 23 percent interest, it takes about six months and costs roughly $70 in interest. If you pay it off in two weeks, it costs about $5 in interest. The faster you pay, the less you spend.
Is there a way to avoid the cash advance fee?
No. Every cash advance charges a fee — it is built into the product. Some cards offer slightly lower fees for ATM withdrawals or balance transfers, so compare your card's terms. The only way to avoid the fee is to not take a cash advance.