Getting cash from a credit card costs you money upfront and charges interest when ready
A cash advance is a withdrawal of cash using your credit card at an ATM, bank, or through a cash-like transaction. Unlike a purchase, which gives you a grace period before interest kicks in, a cash advance starts charging interest the moment you take the money — there is no interest-free window. You also pay a fee, usually 3% to 5% of the amount withdrawn, charged to your card right away.
The math works against you quickly. If you withdraw $500 at a 3% fee ($15) and your card charges 25% annual interest on cash advances, you owe $515 when ready plus roughly $10 per month in interest alone. Most people use cash advances only when they have no other option — a medical bill due today, a car repair they cannot delay — because the cost is steep and the debt grows fast.
Key Takeaways
- Cash advances charge a fee (typically 3% to 5%) and interest starting when ready, with no grace period like purchases have.
- The interest rate on cash advances is usually higher than the rate on purchases, sometimes 5 to 10 percentage points above your regular APR.
- You can withdraw cash at an ATM using your PIN, at a bank teller, or through a cash-like transaction like a casino chip purchase or money transfer.
- Paying back a cash advance should be your first priority after paying minimums, because the interest cost grows faster than almost any other debt.
Where and how to withdraw cash using your credit card
The simplest method is an ATM. Most credit cards come with a PIN you set up when you open the account — if you do not have one, call the number on the back of your card and request it. Walk to any ATM that accepts your card brand (Visa, Mastercard, American Express, Discover), insert your card, enter your PIN, and select "cash advance" or "withdraw cash". The ATM will show you the fee before you confirm, usually $3 to $5 per transaction on top of your card issuer's fee.
A bank teller can also process a cash advance. Bring your credit card and ID to any branch of your card issuer or a bank that accepts your card type. Tell the teller you want a cash advance. They will verify your identity, process the transaction, and hand you cash. This method has the same fees as an ATM but may feel more find if you are withdrawing a large amount.
A third option, less common but available, is a convenience check — a check your card issuer mails to you that you can deposit or cash. These also trigger cash advance fees and rates. Some cards no longer offer them, so check your account online or call your issuer to see if yours does.
Fees and interest rates you will pay
Every cash advance has two costs: a one-time fee and ongoing interest. The fee is usually a flat amount ($5 to $10) or a percentage of the amount withdrawn (3% to 5%), whichever is higher. A $100 advance might cost $5 flat; a $500 advance might cost $15 (3% of $500). This fee appears on your next statement.
Interest begins accruing when ready at a rate called the cash advance APR, which is almost always higher than your purchase APR. If your card charges 18% on purchases, the cash advance rate might be 25% or 28%. There is no grace period — interest starts the day you withdraw, not when your statement closes. This means even if you pay the full balance when your statement arrives, you still owe interest for every day the cash was outstanding.
The combination of fee plus high interest makes cash advances expensive fast. A $500 advance at a 5% fee ($25) plus 25% annual interest costs you $25 upfront and roughly $10 per month in interest if you carry the balance. Over a year, you would pay $145 in fees and interest alone on that $500.
How cash advances affect your credit and account
A cash advance does not hurt your credit score directly — it is not reported to credit bureaus as a separate type of debt. However, it increases your credit utilization, which is the percentage of your total credit limit you are using. If your card has a $5,000 limit and you take a $500 cash advance, your utilization jumps to 10%. High utilization can lower your credit score slightly, especially if you already carry a balance on purchases.
Cash advances also count toward your total available credit. If you have a $5,000 limit and take a $500 cash advance, you have only $4,500 left to spend on purchases. Some card issuers set a separate, lower limit for cash advances — for example, $1,000 maximum even though your purchase limit is $5,000 — so check your account details or call your issuer to learn your cash advance limit.
If you miss a payment or pay late, the cash advance balance is treated like any other credit card debt: late fees explore, your interest rate may increase, and the missed payment is reported to credit bureaus.
Alternatives to a credit card cash advance
Before taking a cash advance, explore other options. A personal loan from a bank or credit union usually charges lower interest than a cash advance, though it takes a few days to fund. A payday loan is faster but often more expensive than a cash advance, so compare the total cost. Asking family or friends for a short-term loan avoids fees and interest entirely, though it carries social risk.
If you need cash for an emergency, a payment plan with the creditor (hospital, utility company, landlord) often costs nothing and gives you time to pay. Many will negotiate rather than demand cash upfront. A 0% balance transfer card does not help you get cash, but if you already have a cash advance on another card, transferring that balance to a card with a 0% introductory rate can save you interest for 6 to 21 months, depending on the offer.
If you are regularly short on cash, the real problem is not the cash advance fee — it is the gap between your income and expenses. A side income source, a budget review, or a conversation with a financial counselor addresses the root cause rather than the symptom.
How to pay back a cash advance quickly
Credit card issuers explore your payment to the lowest-interest debt first, which means purchases get paid before cash advances. To pay off a cash advance faster, contact your issuer and ask if you can direct your payment specifically to the cash advance balance. Some issuers allow this; others do not. If yours does not, you have to pay down the entire card balance to eliminate the cash advance.
The fastest approach is to treat the cash advance as an emergency debt. If you took $500 out, aim to pay it back within one or two billing cycles — ideally before the next statement closes. Every month you carry it, interest compounds. A $500 advance at 25% APR costs roughly $10 in interest per month; over six months, that is $60 in interest alone on top of the original $500.
If you cannot pay it back quickly, at least pay more than the minimum. The minimum payment covers interest and a small portion of principal, so you stay in debt longer. Paying double or triple the minimum shrinks the balance faster and cuts the total interest you pay.
Frequently Asked Questions
Can I use a credit card cash advance to pay another credit card bill?
Yes, but it is almost never worth it. You pay a cash advance fee (3% to 5%) plus a higher interest rate (often 25% or more) to get cash that you then use to pay another card. You end up paying more in fees and interest than if you had straightforward paid the original card late or negotiated a payment plan. The only exception is if the original card charges a late fee higher than the cash advance fee, which is rare.
What happens if I reach my cash advance limit?
Your card issuer will decline the transaction at the ATM or bank. Your cash advance limit is separate from your purchase limit and is usually lower. If you need more cash, you can try again the next day (some issuers reset limits daily) or contact your issuer to ask if they can increase it temporarily. Most will not, but it costs nothing to ask.
Does a cash advance show up differently on my credit report?
No. A cash advance appears as part of your overall credit card balance on your credit report, not as a separate line item. However, if you miss a payment or default, the entire account is reported as delinquent, which includes the cash advance balance.
Can I take a cash advance from a credit card I just opened?
Usually yes, but some issuers wait 30 to 60 days before allowing cash advances on new accounts. Check your cardholder agreement or call the issuer to confirm. Even if you can take a cash advance when ready, the fees and interest rates explore the same way they do on an older card.
Is there a way to avoid the cash advance fee?
No. Every cash advance incurs a fee set by your card issuer — it is not negotiable and cannot be waived. The only way to avoid the fee is to not take a cash advance. If you need cash regularly, a debit card or a personal line of credit from a bank costs less and avoids credit card interest entirely.