Can I Withdraw Money from My Milestone Credit Card?

The Milestone Gold Mastercard and Milestone Platinum Mastercard from Credit One Bank offer cash back rewards, no annual fee, and other benefits on your purchases. However, a common question cardholders have is – can I withdraw cash or take out money advances using my Milestone credit card?

The short answer is yes, you can withdraw cash against your Milestone credit card’s limit if you need to. However, doing so frequently or in large amounts is not recommended, for several important reasons we’ll explore.

In this comprehensive guide, we’ll cover:

  • How cash advances work on Milestone credit cards
  • Fees, interest rates and limits for cash withdrawals
  • Pros and cons of using your card for cash advances
  • Impacts on your credit score and card benefits
  • Alternatives to avoid taking cash advances
  • Tips for responsible use if withdrawing cash

Let’s dive into the full details on whether tapping your Milestone card for cash makes financial sense.

How Do Cash Advances Work on Milestone Cards?

Milestone credit cards do allow you to withdraw cash up to your available credit limit. Here is how cash advances work:

  • ATM Withdrawals – Use your Milestone card at an ATM to withdraw cash just like a debit card.
  • Over the Counter – Many banks allow credit card cash advances over the counter at a teller.
  • Checks – You may be able to request convenience checks to write against your Milestone card’s limit.
  • Transfers – Transferring balances to your Milestone card from another credit account is considered a cash advance.

So through various methods, you can withdraw cash against your Milestone credit limit. But be aware this is treated very differently than purchases. Let’s look at the costs.

Fees, Rates and Limits on Cash Advances

Unlike purchases which have an interest-free grace period, cash advances on the Milestone cards incur fees and high interest immediately:

  • Fees – You will be charged a cash advance fee, either $5 or 8% of the amount, whichever is greater.
  • APR – Cash advance APR is typically at least 25% and could be up to 29%, much higher than purchase rates.
  • Limits – Cash withdrawals are limited to 50% of your total credit limit on some Milestone cards.
  • Repayment – No grace period. Cash advance interest accrues immediately on the withdrawal amount.

As you can see, the costs and downsides of using your Milestone card for cash are steep compared to purchase transactions. Now let’s weigh some pros and cons.

Pros of Cash Advances on Milestone Cards

While costly, here are some potential benefits of cash advances against credit cards like the Milestone:

  • Quick cash access – Get cash immediately in an emergency versus waiting on a loan.
  • No credit check – Cash advances don’t require a hard credit check like a new loan would.
  • Convenience – Withdraw or transfer cash easily any time directly from your credit account.
  • Credit line reuse – Tap unused credit limit without opening a new credit account.
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In certain urgent cash crunch situations, the ability to quickly access funds against your existing credit line can be helpful. But there are also some big drawbacks to watch out for.

Cons of Cash Advances on Milestone Cards

Some major disadvantages of relying on cash advances from Milestone credit cards include:

  • High fees – Cash advance fees take an immediate bite out of withdrawn amounts.
  • High APR – Double-digit interest starts accruing right away on cash withdrawals.
  • Interest accumulation – Unlike purchases, no grace period before interest starts accumulating.
  • Risk of overspending – Easy cash access makes it tempting to withdraw more than is affordable.
  • Repayment challenges – Cash advances in addition to normal spending can be difficult to pay off.
  • Lower availability for purchases – Cash withdrawals reduce your available limit for purchases.
  • Credit damage – Frequent cash advances may hurt your credit utilization and score.

The steep fees and lack of grace period on cash advances make them extremely costly compared to standard purchases with Milestone cards. Cash advances also carry some additional risks we need to consider.

How Cash Advances Can Impact Your Credit Score?

Beyond just the financial costs, relying on cash advances can also impact your long-term credit health in a few key ways:

  • Higher utilization – Cash advances raise your credit utilization immediately since no grace period. This can lower your credit score if too high.
  • Increased potential for late payments – If cash withdrawals overextend your budget, you may miss payments and hurt your credit.
  • Potential closure or limit cuts – Issuers may cut your limit or even close your account if you constantly rely on cash advances.
  • Future credit denials – Lenders view frequent cash advances negatively and may decline future applications.

While not an immediate concern with occasional use, regularly tapping your Milestone card for cash advances can be problematic for your credit profile over time.

Effects on Credit Card Rewards and Benefits

One other consideration is that cash advances do not qualify for credit card rewards and benefits. For example:

  • No cash back rewards – Milestone card cash back programs exclude cash advances.
  • Loss of grace period – Even for purchases, cash use forfeits your interest-free grace period.
  • Not covered by fraud protection – Cash advances often aren’t included under credit card fraud policies.
  • No purchase protections – Benefits like price protection, return protection and extended warranties typically exclude cash-like transactions.
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So relying on cash withdrawals means missing out on some of the key perks and protections of Milestone card membership.

Alternatives to Avoid Cash Advancing on Credit Cards

Given the drawbacks, it’s usually best to avoid using Milestone cards for cash advances unless absolutely necessary. Here are some healthier alternatives to consider first:

  • Personal loans or lines of credit – Unsecured loans or HELOCs typically have lower rates than credit card cash advances.
  • Paycheck advances – Some employers provide paycheck advances with fees lower than credit card rates.
  • Overdraft protection – Opt in to overdraft coverage on your checking account for urgent overages.
  • Peer-to-peer loans – Services like LendingClub allow borrowing funds from individual investors at better rates.
  • 401(k) loans – Borrowing against your own 401(k) avoids credit impacts and may offer low interest.
  • Cash flow adjustments – Revisit your budget to cut discretionary spending and redirect funds to priorities before adding debt.

These options provide less costly sources of cash in a crunch that won’t damage your credit standing like cash advances ultimately can.

Tips for Responsible Cash Advance Use

If you do need to take a cash advance against your Milestone card, follow these tips to be smart about it:

  • Check alternatives first – Exhaust other, cheaper borrowing options before using the card.
  • Withdraw only what you can repay quickly – Don’t take on unaffordable debt just because the limit allows it.
  • Have a firm payoff plan – Know exactly when and how you will pay off the advance. Build into your budget.
  • Track interest accruals – Understand daily compounding interest and how much you will end up paying.
  • Read disclosures carefully – Cash transactions may have different dispute rights compared to purchases.
  • Watch out for fees – Know foreign transaction fees and low balance fees that may apply to cash withdrawals.
  • Avoid at high balances – Don’t withdraw cash if your balance is already near the credit limit.
  • Contact issuer if needed – Discuss a temporary rate reduction or hardship plan if facing repayment challenges.
  • Use sparingly – Cash advances should be rare, for true emergencies only. Don’t use regularly or for discretionary spending.
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Following prudent practices prevents cash advances from becoming a dangerous debt trap. As a last resort with discipline, they can serve as a cash flow bridge in tough spots.

FAQs

Can I withdraw cash from my Milestone Credit Card?

Yes, you can typically withdraw cash from your Milestone Credit Card, but it’s subject to cash advance fees and interest rates, which are often higher than standard purchase rates.

How do I withdraw cash from my Milestone Credit Card?

You can withdraw cash from your Milestone Credit Card at ATMs that accept your card network (Visa, Mastercard, etc.). You’ll usually need a PIN provided by your card issuer to complete the transaction.

What fees are associated with cash advances on Milestone Credit Cards?

Cash advance fees typically range from a percentage of the amount withdrawn to a flat fee, whichever is higher. Additionally, interest on cash advances usually starts accruing immediately and at a higher rate than regular purchases.

Is there a limit to how much cash I can withdraw from my Milestone Credit Card?

Yes, there’s usually a cash advance limit on your credit card, which may be lower than your overall credit limit. You can check your card’s terms and conditions or contact customer service to find out your specific cash advance limit.

Are there any alternatives to withdrawing cash from my Milestone Credit Card?

Yes, if possible, it’s generally more advisable to use your credit card for purchases rather than cash advances, as the latter comes with higher fees and interest rates. If you need cash, consider other options like using a debit card or getting a personal loan with more favorable terms.

The Bottom Line – Should You Use Your Milestone Card for Cash Advances?

While Milestone credit cards do enable you to withdraw cash against your limit, it should generally be avoided outside of temporary emergencies. The exorbitant fees, high interest rates beginning immediately, credit score risks, and loss of card benefits like rewards make cash advances a very expensive source of funds.

Practice smart credit management by reserving cash advances only for absolute necessities you can quickly repay, after exhausting safer and cheaper alternatives. With a measured approach, you can tap into cash access if absolutely needed while minimizing financial harm. But restraint is ideal to maximize the value of your Milestone card membership.