Credit card debt can be difficult to overcome, and taking cash advances can make it so much worse. Everyone with a credit card has received this in the mail – the tempting offer to take cash advances from a credit card (such as using a credit card at an ATM). During the summer months when consumers are on that much need vacation, what could it hurt to take a little quick cash from the credit card? 

Actually, quite a lot. Consider that the average interest rate on cash advances is about 24% according to an analysis by (some are as high as 36%!). And unlike purchases, there is no grace period before interest begins to accrue! On top of that, there’s an upfront fee of as much as $10 or 5% of the transaction.

So let’s say you take a $1,000 cash advance for spending money on the beach, and you pay it off in full in 30 days when you get your statement. That spending money could cost you a whopping $70 in fees and interest. Bad idea right? So what about the so-called “convenience checks” credit card companies are so fond of mailing – basically checks that work as cash advances on credit cards. Generally it’s the same result, it’s just a different way of buying cash off the credit limit. If you’re already trying to dig out of credit card debt, cash advances are going to make that hole even deeper.

So before you head out this summer, plan for your cash needs – when you plan your vacation, start putting cash away immediately. Or better yet, keep the money in the bank and simply use a debit card from a bank account (most bank cards can be used as credit cards against a bank account). If it’s too late, and the credit card debt is insurmountable (don’t worry, you are not alone!) then it may be time to consider bankruptcy to get that immediate fresh start.