How to Use a Low Cash Advance Rate Credit Card

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While the majority of credit cards can be pretty crippling when used for accessing cash, low cash advance rate credit cards make withdrawing - or purchasing - cash on credit a much more viable and cost effective option.

Make the most of your card...

- Budget your income and keep on top of monthly repayments
With many credit cards - even low cash advance rate credit cards - charging higher rates of interest on cash advances it's a good idea to keep on top of repaying any cash transactions you make on credit.

When using a credit card for any transaction, especially cash advances, it's important to budget your monthly income so that you can repay your credit card balance each month and reduce the likelihood of getting into card debt.

- Make use of the interest free period
All credit cards offer an interest free period - which is the amount of time between statements you have to repay your balance in full without being charged any interest.

While the majority of credit cards only include purchases in their interest free period, some low cash advance rate credit cards also include cash advance transactions too.

The interest free period is like a recurring 0% deal - all you have to do to benefit is repay your balance in full - effectively using your credit card like a charge card.

If your low cash advance rate credit card also includes cash transactions within the interest free period this is a great feature to make the most of - and will keep your cash advances interest-free if your repay your statement balance in full.

- Use online account management services
Using a credit card for withdrawing or purchasing cash can be much harder to keep abreast of than simply using a credit card for purchases.

Making good use of online account management services can help you know exactly what transactions you've made and what you current credit card balance is - so that you don't exceed your credit limit.

When using online account management services remember to keep your log-in details safe - be aware of any conspicuous looking e-mails - 'phishing e-mails' asking for your online account details and password. You should never reveal your online account details via e-mail.

Things to watch out for...

- Cash advances abroad
While a low cash advance rate credit card will help to lower cost of withdrawing or purchasing cash in the U.K. - making cash transactions abroad may carry other fees too.

Most credit cards will charge a 'foreign transaction fee' when you use the card to make a transaction in a foreign currency abroad or even over the Internet.

Cash advances are also subject to this foreign transaction fee when made abroad - and will be added on to any cash advance handling fee your credit card charges.

- Loyalty reward schemes
Credit card loyalty reward schemes are a great way to earn points that can be redeemed for free rewards, such as cash back, goods and services and travel.

However, these reward schemes will never award you with points on cash advances made with your credit card.

So if your low cash advance rate credit card also offers a reward scheme, remember you'll only be able to accumulate reward points on your purchases - and not when you use your credit card for withdrawing or purchasing cash.

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