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Answer: If your credit card offers a cash advance option, you can get the advance by using your PIN at an ATM or by using a convenience check that’s sent to you by your issuer.
This might sound like an easy way to get a quick loan, but you’ll find this is a very expensive way to solve a cash flow problem. Here are the disadvantages:
With a $2,000 cash advance, you’re looking at up to $100 in fees and then around $42 in interest expense if you pay it off in one month. So you end up paying around $142 to borrow $2,000 for one month.
Does getting a cash advance ever make sense? I suggest you explore every other possibility before getting a cash advance on your credit card. The only circumstances where this isn’t likely to become a financial disaster for you is if you’re in a dire emergency and you know you’ll be able to pay it back within the month.
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