Cash Advance Loan Calculator

Cash advances, which allow you to “borrow” money from a credit card account, are a unique way of getting cash fast. Convenient but can be very expensive if you need more than the money you borrowed from your account. Cash advances come with high fees and interest rates. Although obtaining a low cash advance rate is possible, you should strongly consider using loan calculator before applying for a cash advance.

What is the cost of a Cash Advance?

Let’s suppose you are at a festival and need cash. These fees are added to your card.

  • ATM withdrawal fees: $3
  •  fee: The greater amount of $10 or 5% from the total transaction cost.
  •  Interest Rate:21.99%

Your initial costs if you drew $500 on the first day of the festival would be:

  • ATM withdrawal fees: $3
  • fee: $25
  • Total: $528

The rate of interest accrued on this withdrawal would be 21.99% APR.

How do I calculate the total cost for my Cash Advance?

It is easy to calculate your cash advance cost. To calculate the total cost, you simply add the interest and fees to the loan amount. These are the fees and interests that will add up to your cash withdrawal sum:

  1. APR. The interest rate that you begin to accrue the day after you make your transaction. This is the most common credit card interest rate, and it is usually higher than 25%. Credit union cards are the exception. These cards may have an intro APR of 0% for cash advances, but all cards have a low APR of 9% to 18%.
  2. fee. The fee you pay when you cash advance. You’ll typically find a fee between 3% to 5% on the amount. This fee is wholly exempted for some cards issued by credit unions.
  3. ATM fees. You will be charged a $3 fee for each withdrawal. This fee can usually be avoided if your money is withdrawn from an ATM owned by your card issuer.

How do I calculate Cash Advance interest?

Let’s say your cash advance APR was 26%. This is the annual interest rate. It means that you will earn less than 0.1% each day. Let’s suppose you withdraw $500 and want to pay it off within 30 days. Let’s see how it works:

26 percent /365 days = 0.0712x $500×30 days = 1,068/100% = $10.68

If you paid the $500 cash withdrawal off within 30 days, you’d pay $10.68 in interest

Is it ever a good idea to get a Cash Advance?

Cash advances can be expensive and last-resort options, but sometimes they are necessary.

Use your debit card instead if you have one. This will save you fee as well as the cash advance APR. If that is not possible, you can calculate the cash advance costs and create a repayment plan.

Other options for obtaining a Cash Advance

Cash advances are not the only option if you require immediate cash access. You can apply for:

  • Purchase intro APR credit card with 0% interest rate.  Credit cards with a 0% intro APR term on purchases might be a good option, especially if you want to make purchases now and pay them off in 12 to 20 months without paying interest.
  • Balance transfer credit cards. You should consider a balance transfer card with a 0% intro APR period if you have credit card debt that is difficult to pay. After you have transferred your balance, you will be eligible for between 12 and 21 months of 0% intro-APR period. This will help you pay down your debt quicker and without interest.

In conclusion

If you need money right now, a cash advance might help. On the other hand, credit card cash advances are virtually always an expensive alternative due to high rates and fees.

If you really must use a credit card for cash withdrawals or other loan activities, make sure to select one with a low rate and examine choices to keep your costs down.

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