Why a Cash Advance through Your Credit Card Is a Bad Idea

Using a cash advance is a popular way to get money when you are in trouble financially. Many people get cash advances from their credit cards because of the convenience that it offers. However, this is typically not in your best interest. Here are a few things to consider about getting a cash advance through your credit card.

Higher Interest Rate

When you get a cash advance through your credit card, you will end up paying a different interest rate than you pay on your other balances. The cash advance rate will almost always be higher than the other rates. Typically, credit card interest is high. The rate with cash advances is even higher. Therefore, this method could end up costing you quite a bit of money in the long run.

Keeping Track of Borrowed Amounts

With a cash advance from a credit card, it can be difficult to keep track of how much you have borrowed. When you get in the habit of using this method to get cash, you begin to leave beyond your means. If you do it enough, you could borrow thousands of dollars before you realize what you have done. This could put you in a financial hole that takes years to get out of.

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