Tips Concerning Credit Card Checks and Cash Advances

 

Once you’ve got a credit card, you’ll find that you can do more with it than just pay for things with the card. You might be sent a credit card checkbook, for those times when you’re paying someone who can’t accept your card. After all, the company wants you to use the account as often as possible.

 

You might also be offered cash advances – a way of withdrawing cash directly from your credit card, either to your bank account or from a cash machine. This is designed for when you need cash in an emergency. You really shouldn’t overuse either of these features, and here’s why.

 

1.  You Pay More Interest.

 

With most cards, checks and advances are charged at a higher rate of interest than normal spending. You often give up any interest-free period (your normal grace period), meaning that you start paying interest on the money literally from the minute you spend the money. Not only that, but most cards will also charge a fee each time you use cash advances or credit card checks – and using an ATM may increase the fee even further.  Check the fine print in your card’s terms and conditions to see what sort of cash advance fee they are charging.

 

2. It makes you a marked man (or woman).

 

When you use a credit card check, or accept a cash advance, you’re spending habits will be showing in your records (at the credit card company).  Repeated purchases in this way, especially advances, goes to show that you’re not just using a credit card for convenience – you really need the money. This marks you out in the credit card company’s records as someone who shouldn’t be given a good deal. After all, you won’t be going anywhere.

 

3. Try to spend with the card instead

 

Instead of using cash to pay for small things and finding you have to take advances or use checks to pay for bigger things, it’s better to do it the other way around. If you’re in a situation where you’re relying on advances, you should start using your card for smaller things where you wouldn’t usually bother, just to avoid taking the advances and paying more interest. Be strategic in how you spend.

 

Remember that there are very few bills now that must be paid for by check or cash, so there aren’t many reasons to ever use credit card checks. If you’re willing to call them up and wait in their queue for a while, the chances are you can get them to accept a credit card payment just by you reading the number.

 

4.  Look out for cash advance limits.

 

If you start relying on cash advances, sooner or later you’ll probably run into an advance limit. The credit card companies don’t always advertise it (but it is usually listed in the terms and conditions, and often is listed on your monthly statement), but many of them