Sometimes when you need cash quickly to pay someone back or take care of a bill, your bank account might not be an option. Depending on whether your credit card has a cash advance feature, you may be able to access the funds you need. But first, you must know how to get cash from credit card transactions, such as those completed at an ATM or a bank.
How to Get Cash From a Credit Card
Getting cash from a credit card is easy. You can go to an ATM or visit a bank associated with your credit card. Here’s how:
How to Get Cash From a Credit Card at an ATM
- Have the personal identification number or PIN that was assigned to your credit card ready. If you don’t have a PIN, you’ll need to call your credit card issuer.
- Find an ATM that will allow you to make a cash withdrawal with your credit card, and swipe or insert your card in the machine.
- Enter the PIN and select the “credit” option when asked which account you want to withdraw funds from: checking, savings or credit.
- Select the amount you want to withdraw.
How to Get Cash From a Credit Card at a Bank
- Have your credit card and driver’s license or other bank acceptable form of identification ready.
- Go to a bank that offers cash advances for the credit card network listed on your card: Visa, Mastercard, American Express or Discover.
- See a teller to complete your transaction.
How to Get Cash From a Credit Card Without a Pin
Besides being able to visit a bank teller to get cash from a credit card without a PIN, you also have another option: convenience checks.
Some credit card issuers provide convenience or access checks that you can use to draw on your credit line at banks that accept them. The terms that apply to cash advances — higher APRs, and no grace period — also apply to convenience check withdrawals.
How Much Cash Can I Withdraw From My Credit Card?
The amount of money you can withdraw from your credit card depends on the cash advance limit on your account less the cash advance fee.
Your current balance and available credit also play a part. If your cash advance limit is $1,000, but you only have $500 available credit on the card due to your current balance, you will be restricted to a cash advance of $500 or less including fees.
You can find your cash advance limit by referencing your account statement or by calling the credit card company that issued the account.
The Cost of Withdrawing Money From a Credit Card
Be sure to read terms of your credit card agreement before taking out a cash advance. Credit card issuers usually charge both an upfront fee and a cash advance APR when you withdraw cash from your credit card.
You may also have to pay an ATM or bank fee issued by the owner of the ATM or bank where you get the cash advance.
- Cash advance fees – These fees may vary, depending on the card issuer. For example, one bank’s cash advance fee may be the greater of $10 or 3%. While another bank’s cash advance fee is $10 or 5%, whichever is greater.
- Cash advance APR – These fees may also vary, depending on the card issuer. For example, if one credit card charges a variable APR of 24.9% for cash advances, another may charge a variable cash advance APR of 27.49%. These fees are typically higher than purchase APRs, and they don’t include a grace period — interest starts accruing automatically.
How to Calculate the Cost of Getting Cash From a Credit Card
Once you know your credit card’s cash advance APR and fee, you can calculate how much it can cost you to get a cash advance.
For example, if you take out a $500 cash advance with a 26% APR, here’s the calculation to figure the annual rate of interest:
$500 cash advance x 0.26 interest = $130 in annual interest
Fee and interest costs if it takes one year to pay off the cash advance:
$130 in annual interest + a 3% cash advance fee of $15 = $145
Bottom line: The $500 cash advance will cost you a total of $645 with the fee and interest.
But what if you could pay it off faster?
Fee and interest costs if it took a month to pay off the cash advance:
First, you need to calculate how much interest you would pay each day on a cash advance of $500:
$130 yearly interest /365 days = $0.356 daily interest
This is how much you would pay in monthly interest:
$0.356 daily interest x 30 days =$10.68 in monthly interest
This is how much you would pay for the fee + interest:
$10.68 in monthly interest + 3% cash advance fee of $15 = $25.68
Bottom line: If you pay off the $500 cash advance in one month instead of one year, you’ll pay a total of $525.68 for the fee and interest a savings of $119.32.
Use this handy calculator to determine the true cost of a loan and the potential savings for paying it off quicker.
You Could End up Paying More for a Cash Advance
Credit card cash advances carry interest rates and balances that are separate from those of credit purchases, but the creditor can apply your payment to both balances.
If you only pay the minimum payment due, however, the credit card issuer can choose, by law, to apply the payment only to the balance featuring the lowest interest rate, which is often the rate for purchases. In that case, the cash advance balance will continue to accrue the higher rate of interest each month, which will increase your cash advance balance.
Is Getting Cash From Your Credit Card the Best Option?
Only you can answer this question. However, due to APR, fees and conditions tied to a credit card cash advance, there are some questions you can ask yourself to make sure this is the best decision for your financial situation:
- Is the cash advance for an emergency expense, or can you opt to wait until you can afford to pay cash?
- If you take the cash advance, can you repay the money within the next month to avoid interest charges from accruing indefinitely?
- Do you have another option for getting the emergency cash you need?
Strategies for Avoiding Credit Card Cash Advance Fees
Depending on the amount of the cash advance and how long you think it may take you to pay it back, you might want to consider other options to avoid fees and interest.
1. Ask a Friend or Family Member
If you need a short-term loan, you can consider asking a financially stable friend or family member if they can give you a loan. You can offer to sign a written agreement that details how much you’re borrowing, amount of payments and interest and how long it may take you to pay it off.
2. Unsecured Personal Loan
If your credit is good, you may be able to get a personal loan from a bank. A personal loan could potentially be cheaper than a cash advance that takes you months or years to pay off by making minimum payments.
3. Secured Loan
A secured loan may be an option if a bank is unwilling to grant you an unsecured personal loan. This type of loan is anchored by something of value that you own — also known as collateral — such as a certificate of deposit or savings account. If you don’t make the payments on the loan, the bank can take possession of the collateral.
4. Borrow From Your 401 (K)
If your credit history is a concern, you may be able to borrow money from your 401 (k). With a 401 (k) loan, no credit check is involved. Fees and interest rates can vary by employer and plan administrator, but they often compare with current personal loan rates. You can borrow up to 50% of available funds — up to a maximum of $50,000 for up to five years.
Is Getting Cash From a Credit Card Worth It?
Whether or not a cash withdrawal from your credit card is worth it is for you to decide. You can consider factors such as how much you are planning to borrow and what the interest rate and fees are — as well as how long it will take you to pay it back.
