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LaToya Irby

Are Costly Cash Advances Wise?

By , About.com GuideSeptember 27, 2008

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The speedometer on my car goes up to 160 miles per hour. But just because my car can physically go 160 mph, doesn't mean I should ever drive that speed. Cars are more difficult to control at high speeds and a crash at that speed could be fatal.

Just because your credit card allows you to take out a cash advance doesn't mean it's a smart decision. A cash advance is one of the most expensive types of balances you can carry. The interest rate is higher, you won't have a grace period, and you'll pay ATM fee and cash advance fees. Those costs make a cash advance one expensive loan.

I'd be remiss if I told you to stay away from cash advances and failed to tell you the smart way to do one. As long as cash advances are an option, some cardholders are going to use them. If you're going to go that route, be smart about it. Take Out a Cash Advance Without Plummeting Into Debt has tips on handling a cash advance and alternatives to cash advances.

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September 28, 2008 at 10:56 am
(1) My Debt Refinance :

Cash advances can be even more dangerous when you already have some debts in your credit card, as they can go to the end of the queue of your bill for payment. (with some credit cards)

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