Why are credit card cash advances so expensive?

Cash advances are one of the costliest ways to borrow. Unlike purchases, they have no grace period – interest starts accruing the moment you take the cash. The cash advance APR is usually higher than your purchase APR, often 25–30%, and there's an up-front fee of around 3–5% (or a $10 minimum) on the amount withdrawn. So pulling $500 might cost $15–$25 immediately plus daily interest from day one. Worse, payments are typically applied to lower-rate balances first, so the expensive advance can linger. Using your card at an ATM, buying cash-like items (money orders, gift cards, some crypto), or certain transfers can all trigger advance fees. Treat cash advances as a last resort. If you need emergency cash, a personal loan, a 0% card purchase, or tapping savings will almost always cost far less.