Cash Advance Repayments and Cash Advance Apps 101

If you're short on funds, you might consider a cash advance. And while they might be an easy, convenient way to tap into a source of cash, you'll want to know the pros and cons of doing so. Here, we'll dig into what exactly a cash advance is, when it might make sense for you, its pluses and minuses, and how to use cash advances responsibly.

What is a cash advance?

A traditional cash advance is essentially a short-term loan that you're taking against your credit card. In other words, you're borrowing money from your existing credit line. You'll likely want to use a cash advance for emergency expenses, such as unexpected bills or gaps in your cash flow. These are for purchases or expenses you can not put directly onto your credit card.

You've probably also heard of a cash advance app. Note this is different from a traditional cash advance that's taken from a credit card. Also known as early payday apps or direct-to-consumer earned wage access, cash advance apps offer small sums of money, and they're linked to either your bank account or payroll.

Depending on the service, advances can be anywhere from $25 to $750, with higher amounts typically available only to repeat borrowers. One example is Self Cash*, a cash advance tool available in the Self app, which offers small disbursements to qualifying users.

When a credit card cash advance might make sense

A credit card cash advance could make sense for you for unexpected expenses that need to be handled right away where you can't use your credit card – think to help pay for part of your rent, or for services where the vendor doesn't accept cash. Ideally, cash advances shouldn’t be used for non-essential purchases. It's usually a good idea to think twice before tapping into a cash advance for a splurge or big-ticket item that isn't a necessity.

When a cash advance app might make sense

A cash advance app might make more financial sense if you're in a financial pinch and don't need a huge sum of cash. This could be a good idea if there's a small, one-time, necessary expense you need to cover.

For instance, let's say you have a few more days until your next paycheck, and you need to fill up your gas tank or pay for sundry expenses. The key is that you'll be able to get by with the amount taken out of your next check – so take out that advance with care.

Potential costs and risks of credit card cash advances

The reality is that credit card cash advances are expensive. It's important to know the fees and APR on a cash advance up front. You can find this information on a credit card's website under "terms" or on your monthly credit card statements.

Credit card cash advances tend to have high fees – we're talking 24.99% to 29.99% APR or more. Note: the current average APR on credit cards as of May 2025 is 21.16%. Plus, there is usually a cash advance fee, which can be a minimum flat fee of $10 or 3% to 5% of the advance amount, whichever is larger. So if you take out $30 on a cash advance and it's a $10 fee, you're looking at a steep fee.

Plus, there's no grace period with cash advances, which means the interest accrues from day one. You can also find yourself paying ATM fees, bank fees, and transaction fees. Data from the Consumer Financial Protection Bureau (CFPB) finds that in 2022, credit card issuers charged consumers $717 million in fees on $3.6 billion in overall cash advance volume. This represents $1 for every $19 spent.

Potential costs and risks of cash advance apps

As we discussed, you can also access funds through cash advance apps. As for fees, some cash advance apps may have lower fees than traditional credit card cash advances. However, they might charge subscription fees, instant transfer fees, or some may nudge you to cover an "optional" tip.

Besides the costs that might come tacked onto a cash advance app, such as monthly subscription fees, transaction fees, express delivery fees, or suggested tips, you'll want to remember that you'll have less funds available from the next paycheck.

This could potentially lead financial snags down the line. Research by the Financial Health Network found that taking out two or more advances across multiple periods could lead to significant fees over time.

Using credit card cash advances responsibly

If you do decide to go the cash advance route, be sure to proceed with plenty of caution. Here are some pointers:

• Borrow the minimum amount needed. Steep fees and high APR rates can make cash advance fees cost a pretty penny. Only borrow what you need – nothing more. Besides saving you money in interest and fees, you'll have an easier time paying off your cash advance.
• Avoid using them for recurring expenses. Avoid using them for ongoing expenses, such as car payments, utility bills, or student loan payments. Instead, if it is a timing issue consider adjusting the payment due dates for some of your recurring expenses to align with your paychecks and cash flow.
• Know your credit card terms. Be aware of the APR, limits, and fees. As mentioned, you can find this information on the card issuer's website or your monthly credit card statement. Don't treat them as regular income. By no means should a cash advance be used as a financial safety net. This is an expensive form of financing, and you should not rely on them for gaps in cash flow regularly.

If you're struggling financially, seek help from a non-profit credit counseling. For example, you can find a list of counselors through the National Foundation for Credit Counseling (NFCC).

Using cash advance apps responsibly

Here are some basic pointers on how to use credit card apps conscientiously.

• Be aware of the costs. Before you sign up for a cash advance app and take out some cash, look at all the costs. Read the find print and understand exactly how much an advance can cost you. Some cash advance apps offer free advances if you use ACH. So if you plan ahead you may be able to still access the funds without the expedited payment fee.
• Steer clear from taking consecutive advances. If you take multiple advances in a row, you might easily fall behind. When a little bit of your paycheck gets gobbled up each time, you could find yourself with less and less to work when payday rolls around. Instead, aim to take out a cash advance money sparingly. Think twice whether you really need the money or not.
• Rake in additional income. To avoid relying too heavily on cash advance apps, see if you can take on a side hustle or take on extra hours at your job. That way, you won't have to lean too heavily on cash advance apps.

Paying back credit card cash advances strategically

When it comes to paying back credit card cash advances, here are some ways to pay back that advance in a strategic way:

Create a clear repayment plan. Before you take out a cash advance, you'll want to come up with a clear repayment plan. For example, if you take out a $200 cash advance, figure out how much you can reasonably pay each month, and stick to it. For instance, aim to pay it off in four monthly installments.

Avoid minimum payments. Remember: Credit card cash advances have higher interest rates than standard credit card purchases. Plus, there's no grace period on advances, which means interest racks up immediately.

If you can, make payments that are larger than the minimum amount. That way, you won't be stomaching a ton in interest. Aim to pay it back as soon as possible. The sooner you can pay it back, the more you'll save on interest – and perhaps less stress looming over you.

Make adjustments in your budget. To make sure you can afford your monthly payments on your credit card advance, see what you can do to either lower your expenses, or rake in more money each month.

For example, if you want to put, say $100 toward your payments each month, where in your budget can you cut back?

Similarly, where can you shave off X amount each month in recurring bills? For instance, bumping down your home internet bill from $80 to $50 might not seem like much, but that's a $30 or $360 savings a year.

To accelerate your repayments, you can also find ways to earn more money, either by side hustles or working overtime at your job. Also see about committing a portion of any workplace bonuses or small windfalls of cash, such as your annual tax refund, toward paying back your credit card cash advance.

Set payment reminders. That way, you'll steer clear of missing due dates. You can also adjust your payment due date, which can help you sync up your payments with your cash flow. For example, to make a payment close to the second paycheck of the month.

Paying back cash advance apps strategically

Now that we've gone over how to pay back credit card cash advances in a mindful, strategic way, we'll do the same for funds you get from cash advance apps:

Create a repayment plan. It's important you're able to prioritize paying back the cash advance. Even if it's an automatic payment, you'll need to plan ahead so that you can comfortably afford to have that repayment taken out from your next paycheck.

Account for the difference in the next paycheck. Because a cash advance means you'll have less from your next paycheck, you'll want to figure out how to account for the difference. Let's say you take a cash advance of $75. Because that's $75 less from your next paycheck, you'll need to either cut back on expenses by that much, or work extra hours or take on side hustle work to cover for that difference.

Pause auto-payment. If you suspect that you might have trouble paying back your advance when the next payday rolls around, see if you can pause "auto-payment." This might be an option on some cash advance apps, especially if you give them a head's-up.

Find ways to rake in extra money. Beyond covering for the difference, it's a good idea to find ways to make extra money on an ongoing basis. That way, you won't rely too heavily on these advances, which could end up creating more anxiety and stress.

Bottom line

Both cash advances and cash advance apps are certainly an option to be used for emergencies, but they require a healthy dose of caution. Responsible, mindful borrowing can preserve your financial health. Be sure to plan, practice discipline, and have plenty of financial awareness to avoid costly consequences that you might regret later.

*Self Cash is offered in the Self app only, bank account connection via Plaid and associated debit card required, not offered in all states.

About the author

A personal finance writer for over 8 years, Jackie Lam covers money management, lending, insurance, investing, and banking, and personal stories. An AFC® accredited financial coach, she is passionate about helping freelance creatives design money systems on irregular income, gain greater awareness of their money narratives, and overcome mental and emotional blocks.

Her work has appeared in publications such as Bankrate, Time's NextAdvisor, CNET, Forbes, Salon.com, and BuzzFeed. She is the 2022 recipient of Money Management International's Financial Literacy and Education in Communities (FLEC) Award, and a two-time Plutus Awards nominee for Best Freelancer in Personal Finance Media. She lives in Los Angeles where she spends her free time swimming, drumming, and daydreaming about stickers.

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