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Cash advance VS. purchasing item for 2 times as much

Valued Member

Cash advance VS. purchasing item for 2 times as much

I have a job in about 2 weeks. For the job I need to buy some equipment (music gear). If I buy new it is $1000. I can picked up the exact same item for $500 barely used. The job is going to pay around $2500 so I can pay off both immediately.

 

My question is, if I do cash advance there is a 3% fee plus 23% interest.

 

I always pay off everything right away so I dont understand interest charges. This is a Chase frrdom card.

 

So can someone please help me calculate, if I pay this off in 30 days how much is 23.9% (roughly) on my $1000??? I dont multiple 23.9% X $1000 do I? That would be roughly $300. The lady at Chase said it would be around $20 for the interest if paid off in 30 days. I dont get how that works. Can someone please expain.

 

PS... I dont have the cash or would just do that. But If I can save $300 or $400 by buying this thing used it will help me out a great deal.

 

Thanks ahead


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4 REPLIES
Regular Contributor

Re: Cash advance VS. purchasing item for 2 times as much

The 23.9% is the yearly interest rate. Since you're paying it off in one month, you would be paying 23.9%/12 so roughly 2%. That's where the $20 came from. You should go for the used, that's totally worth paying the fee and interest charge.
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Valued Member

Re: Cash advance VS. purchasing item for 2 times as much

Perfect. Thanks for your help. I get it now

 

 


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Valued Contributor

Re: Cash advance VS. purchasing item for 2 times as much

the 3% fee on $500 would be an additional $15, still doing better than purchasing new though Smiley Wink

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Moderator Emeritus

Re: Cash advance VS. purchasing item for 2 times as much

I agree with the above posters.  Would still be a substantial savings.

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