If you are in a bind there is a way to access emergency funds using your credit card. This is called a cash advance. While it may seem convenient there are some reasons why you shouldn’t rely on these to fund your expenses. Many people are caught taking out large amounts only to be hit by interest rates that made them regret even taking out the transaction in the first place. Be responsible and if using your cash advance for a short term solution and by paying it back quickly, you won’t have to deal with situations that could potentially ruin your bank account.
Taking out cash through your credit card is expensive. There is also no grace period so the day that you post the transaction is when your interest starts to accrue. There are times where you will end up paying the amount that you took out due to interest, which can easily put you in debt. Higher interest rates takes place when you take out a cash advance and there may be additional fees associated that regular credit card purchases are not subjected to.
There are cases where people just can’t afford things so they resort to taking out a cash advance. Confusing your needs and wants is a common issue that credit card holders have which explains the numerous amounts of debt issues. While the initial feeling of satisfaction takes place after your purchase, the price you pay can immediately lead to regret. Impulsive reactions are a habitual tendency and should be taken care of before resorting to using your credit card.
Cash advances are a short term solution and should be paid back as soon as the owner can. Another issue for people is credit card debt. If you are already in debt with your credit card, there shouldn’t be a reason to pay off that debt with another credit card. It’s a risky and dangerous financial strategy that usually doesn’t end well for the borrower.