Should I Use a Cash Advance for Christmas Cash?

As you get full swing into your Christmas shopping, you might be considering a cash advance from your credit card to give yourself cushion to cover the cost of all those gifts. But what is a cash advance?

A cash advance is a short-term loan offered by your credit card company. The credit card company bases what you can borrow on the available amount of your credit line. Note that most credit card companies won’t allow you to use your entire credit line as a cash advance. Many credit card companies cap cash advances at a few hundred dollars for most cardholders.

While a cash advance seems tempting, it’s important to understand the pros and cons. Determining if this decision will help or hinder you is the first step in deciding if a cash advance is a good idea. So, before you run off to the ATM, ask yourself the following questions:

How much will this cash advance cost me?

What you might not know is, cash advances are priced higher than purchases.

Take the Citi®️ Double Cash Card for example, the standard variable APR (annual percentage rate) for purchases is 13.99% to 23.99% while the APR for a cash advance is 25.24%.

Also, there is no grace period. Therefore, you will be charged interest as soon as the cash hits your hands.

Are there fees involved?

The short answer is yes! A cash advance fee is standard and ranges from 3% to 5% of the cash advance amount. Depending on where you make your transaction, there could also be an ATM withdrawal fee.

Fees are a big part of cash advances. So, be sure to read all the fine print.

How long will I have to pay back the cash advance?

Although a cash advance is based on the available amount of your credit line, you might not be allowed to use the full amount. Therefore, reading the terms and conditions is important.

Unlike your regular credit card balance, that you can pay in full each month, the payment schedule for a cash advance may involve a fixed term and payment amount.

Are these gifts worth me going into debt?

I’ll tell you right now, going into debt for one day of bliss is not worth it. Hopefully, you’ve been checking off your Christmas list, using a budget, so you know how much you can (and should) spend.

Is my credit score enough to qualify for a cash advance?

Your credit score is always a consideration. When you request a cash advance,

a credit issuer may check your credit report, even though you’re already an established customer.

Real talk, a cash advance can be a great way to get a cash injection in an emergency. But, before you consider a credit card cash advance for Christmas shopping, I urge you to think long and hard about the real costs associated with withdrawing a cash advance.


Getting a cash advance for Christmas cash might sound like a good idea initially, but you must ask yourself if the associated APR and fees are genuinely worth it. By being more thoughtful with your spending, you’ll be able to seek alternative methods to make everyone’s holiday wish come true – without busting your budget. Want more guidance on making informed financial choices? Join the Flyy Credit University today by clicking here.


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