Excellent ! This is the quality content this community needs.
Note on interest: if you use the “cash advance” feature, and withdraw cash with a credit card, interest will accrue from the first day.
On credit cards not being for everyone: I like to see it as a metaphorical Stanford marshmallow experiment. If you belong to the group who would would eat the first marshmallow right away, credit cards are not for you.
Credit cards are objectively better than debit cards if you can play the game right. They have better protection, cash back, etc… But they do have traps, and you have to be the type of person who can avoid those traps. They are designed to make you want to spend more. Examples: no interest for the first 18 months on some, cash back on most, some are even made of metal and shiny which boosts your ego when you pay at the cash register.
Also this most is mostly relevant for the US, probably Canada and a few other countries. Rules might differ elsewhere.
The correct way to use cash advance is to never use it. Seriously they have a totally different (way higher!) APR that accrues from the first day. Read the conditions of your card and calculate how much you'll be paying if you take out $100 for example
Much better to get a personal loan if you are in that situation. The interest will suck but way less than cash advance
Agreed, cash advance is generally bad. I have thought about doing it in the past for obtaining foreign currency when travelling abroad and needing to pay cash.
Yes, you get very high interest, but overall, if you compare with alternatives:
withdraw $1000 using a debit card, you get the standard 3% fee with most banks, end up paying $30 of fees
withdraw $1000 using a travel credit card that waives foreign currency exchange fees, and pay it back immediately. Maybe the transaction posts within 3 days and you pay 3 days worth of 30% interest. That is still only about $2 or $3 worth of interest depending on their day count convention. Better than the first option.
exchange cash at a foreign currency kiosk: ouch. Fees are extremely high.
I think the travel credit cards that waive the foreign transaction fee still apply it for cash advance? In the grand scheme of things it is not a huge difference
Oh, I was thinking about the situation where you need cash quickly because you don't have enough money to cover something. If you can pay it off immediately then that changes the entire conversation.