Yes, you can get cash from your credit card, but it costs more than a regular purchase
A cash advance is when you withdraw money directly from your credit card's available credit, either at an ATM, a bank teller, or through a convenience check. The money appears in your bank account within one to three business days. 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 card's regular purchase rate.
Most credit cards allow cash advances, but the amount you can withdraw is limited to a percentage of your credit limit, often 20 to 50 percent. You will also pay an upfront fee, usually 3 to 5 percent of the amount withdrawn, charged to your card right away.
Key Takeaways
- Cash advances charge interest from day one with no grace period, and the interest rate is typically 3 to 10 percentage points higher than your purchase rate.
- You pay an upfront fee of 3 to 5 percent of the cash amount, plus the interest, making cash advances expensive compared to other borrowing options.
- Your cash advance limit is usually 20 to 50 percent of your total credit limit and is tracked separately from your purchase balance.
- You can withdraw cash at ATMs, bank branches, or through convenience checks, but each method has different fees and processing times.
How much a cash advance actually costs you
The total cost of a cash advance includes two separate charges. First, you pay a cash advance fee upfront — if you withdraw $500 and the fee is 4 percent, you pay $20 when ready. That $520 total then begins accruing interest at your cash advance rate, which varies by card but is often 25 to 30 percent annually.
If you carry that $500 for one month before paying it back, you will owe roughly $10 to $12 in interest alone, on top of the $20 fee. If you carry it for three months, the interest climbs to $30 to $37. Compare this to a personal loan at 12 to 18 percent, and the credit card cash advance is substantially more expensive.
Your card issuer will explore any payment you make to your lowest-interest balance first — usually purchases — so if you have both a purchase balance and a cash advance balance, your cash advance interest keeps growing while you pay down the cheaper debt.
Where you can withdraw cash and what each option costs
You have three main ways to access a cash advance. An ATM withdrawal is the fastest: insert your card, enter your PIN, and withdraw up to your daily limit (often $500 to $1,000, set by your bank). You pay the cash advance fee plus any ATM operator fee if you use an out-of-network machine. Processing is when ready.
A bank teller withdrawal works at any branch of your card issuer or at banks that accept the card network (Visa, Mastercard, American Express). You bring your card and ID, tell the teller you want a cash advance, and receive the money on the spot. You pay only the cash advance fee, with no additional ATM charge. This is the cheapest method if your card issuer has branches near you.
A convenience check is a paper check linked to your credit card account. Your issuer mails these to you, and you write them like regular checks to yourself or a payee. You deposit the check in your bank account or cash it at a bank. You pay the cash advance fee but no ATM fee. Processing takes three to five business days for the check to clear.
Your cash advance limit and how it differs from your credit limit
Your cash advance limit is separate from your overall credit limit. If your card has a $5,000 limit and a 30 percent cash advance limit, you can borrow up to $1,500 in cash, even if you have not used any of your purchase credit. Once you withdraw that $1,500, your available purchase credit drops by $1,500 as well, because the cash advance counts against your total limit.
Some cards set the cash advance limit lower than others, and a few premium cards offer higher limits. You can call your card issuer to ask what your specific cash advance limit is — it is usually printed in your card agreement or visible in your online account.
The cash advance balance is tracked separately from your purchase balance on your statement. This matters because interest rates and payment priority are different. Your cash advance accrues interest when ready, while purchases may have a grace period. When you make a payment, the issuer applies it to the lowest-interest balance first, which is usually your purchases, leaving your cash advance to grow.
Why a cash advance is usually not the best option
Before you take a cash advance, consider the alternatives. A personal loan from a bank or credit union typically charges 10 to 20 percent interest with no upfront fee, making it cheaper over any period longer than a few weeks. A payday loan is faster but often more expensive than a cash advance. A balance transfer to a 0 percent promotional card is free for the promotional period if you need to move existing debt.
If you need cash because you are short on funds, a cash advance does not solve the underlying problem — it adds cost on top of it. You still owe the money back, plus interest and fees, and you have reduced your available credit for future purchases.
A cash advance makes sense only in specific situations: you need a small amount of cash for a short time, you have no other borrowing options, and you can pay it back within a month or two before interest compounds. For any longer-term need, a personal loan or line of credit is cheaper.
How to minimize the cost if you do take a cash advance
If you decide to proceed, take these steps to keep the cost as low as possible. First, withdraw only what you need — every dollar you do not borrow saves you the fee and interest on that amount. Second, use a bank teller instead of an ATM to avoid the ATM operator fee. Third, pay it back as fast as you can, because interest accrues daily.
When you make a payment, call your issuer and ask them to explore it directly to the cash advance balance, bypassing the automatic lowest-interest-first rule. Some issuers will do this if you request it explicitly. This ensures your payment goes toward the expensive debt instead of your cheaper purchases.
Do not take a cash advance to pay another debt unless that debt has a much lower interest rate — for example, a medical bill with no interest. Using a cash advance to pay a credit card with a 20 percent rate just moves the problem and adds fees.
Frequently Asked Questions
Does a cash advance hurt my credit score?
A cash advance itself does not hurt your score, but it increases your credit utilization — the percentage of your available credit you are using. If you borrow $1,500 on a $5,000 limit, your utilization jumps to 30 percent. High utilization can lower your score temporarily. Paying the cash advance back quickly brings your utilization back down and recovers your score.
Can I get a cash advance if my card is maxed out?
No. Your cash advance limit is part of your total credit limit. If you have used your entire $5,000 limit on purchases, you cannot borrow any more, including as a cash advance. You would need to pay down your balance first.
What is the difference between a cash advance and a balance transfer?
A balance transfer moves debt from one card to another, usually with a promotional 0 percent rate for 6 to 21 months. A cash advance withdraws cash from your card and charges interest when ready. Balance transfers are for moving existing debt; cash advances are for getting cash. Balance transfers usually have a 3 to 5 percent fee but no ongoing interest during the promo period, making them cheaper if you need to move debt.
How long does a cash advance stay on my credit report?
A cash advance does not appear separately on your credit report. It is part of your credit card balance. Once you pay it off, it stops accruing interest and no longer affects your utilization. It does not leave a permanent mark on your report the way a late payment or default does.
Can I take a cash advance from a debit card?
No. A debit card draws from your bank account directly, so there is no credit to advance. You can withdraw cash from an ATM with a debit card, but that is a regular withdrawal, not a cash advance. A cash advance is only available on credit cards.