Barclaycard cash advances are quite pricey, no matter which card you have. The standard Barclaycard cash advance fee is 5% of the amount advanced, or $10, whichever is higher. And most Barclaycards have a 26.24% (V) cash advance APR, which kicks in immediately. The only exceptions seem to be the new Uber Credit Card (3% fee) and the Apple Credit Card (28.24% rate). But no matter what, you’re going to be spending an arm and a leg for the pleasure of turning your credit line into cash. So it’s best to avoid cash advances except in emergency situations.
That said, let’s break down how a Barclaycard cash advance works. Say, for example, that you get a cash advance of $250. The 5% fee adds $12.50, for a total of $262.50 owed. And then a 26.24% APR immediately applies to that amount. You don’t get a grace period, and the interest compounds daily. So every day, you’ll be charged 26.24%/365 – about 0.07% – of what you owe (including interest from previous days). That might not seem like a lot at first, but it adds up quickly. From my quick calculations, you’d end up owing about $40 in interest if you paid just $25 a month. And even if you repay your balance in one month, you’d owe about $6 in interest.
So you can see that cash advances are costly. But that’s not even the worst part. On top of paying more money, you may also raise some red flags with the issuer. I’ve even seen people claim that Barclaycard lowered their credit limit because of cash advances. The bottom line is that cash advances are way too costly to do for a casual reason, and should only be a last resort. And if you absolutely have to make one, pay it back as quickly as possible so you end up owing the least amount extra.