Interest Calculator on Credit Card Cash Advance
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Reviewed by Calculator Editorial Team
Credit card cash advances allow you to withdraw money from your credit card account, similar to an ATM withdrawal. However, cash advances typically come with higher interest rates than purchases. This calculator helps you estimate the interest you'll pay on a cash advance.
How Credit Card Cash Advances Work
When you take a cash advance on your credit card, the issuer provides you with cash (or a check) in exchange for a short-term loan. The amount is debited to your credit card account and must be repaid within a certain period, usually 45 days.
Key Features of Cash Advances
- Higher interest rates than purchases (typically 5-20% APR)
- No grace period (interest accrues immediately)
- Lower credit limit than purchases
- Possible fees for cash advances
Cash advances are often used for emergencies or when you don't have access to your bank account. However, they can be expensive due to the high interest rates and fees.
Comparison with Purchases
| Feature | Cash Advance | Purchase |
|---|---|---|
| Interest Rate | Higher (5-20% APR) | Lower (typically 12-25% APR) |
| Grace Period | None | Usually 21-25 days |
| Credit Limit | Lower | Higher |
| Fees | Possible | None |
How to Use This Calculator
Our cash advance interest calculator estimates the total interest you'll pay on a credit card cash advance. Simply enter the amount you want to borrow, the interest rate, and the number of days you'll take to repay the amount.
Formula Used
Interest = (Principal × Rate × Time) / 100
Total Amount = Principal + Interest
Assumptions
- Daily interest calculation
- No additional fees
- No grace period
Worked Examples
Example 1: $500 Cash Advance at 15% APR for 30 Days
Using our calculator:
- Principal: $500
- Interest Rate: 15% APR
- Days: 30
The calculator shows:
- Interest: $22.50
- Total Amount: $522.50
Example 2: $1000 Cash Advance at 18% APR for 45 Days
Using our calculator:
- Principal: $1000
- Interest Rate: 18% APR
- Days: 45
The calculator shows:
- Interest: $77.43
- Total Amount: $1077.43
Frequently Asked Questions
- What is the difference between a cash advance and a purchase?
- A cash advance is a short-term loan from your credit card issuer, while a purchase is a transaction you make with your credit card. Cash advances typically have higher interest rates and no grace period.
- How is the interest on a cash advance calculated?
- The interest is calculated daily based on the outstanding balance and the annual percentage rate (APR) for cash advances. The formula is (Principal × Rate × Time) / 100.
- Can I pay off a cash advance early?
- Yes, you can pay off a cash advance early without penalty. However, you may still be charged interest on the advance until it's fully paid.
- Are there fees for cash advances?
- Some credit cards charge a fee for cash advances, typically 3-5% of the advance amount. This fee is in addition to the interest.
- How can I avoid high interest on cash advances?
- To avoid high interest, try to repay the cash advance as soon as possible, use the cash advance only when necessary, and consider using a personal loan or credit card with a lower APR for larger amounts.