If you need a quick influx of funds, whether it be for an emergency, to cover an unexpected expense, or to take advantage of a great deal, a cash advance is a great option. In this article, we’ll explain the four different versions of an advance, and offer five scenarios in how they can be used.

5 Ways to Use a Cash Advance

All cash advances are short-term loans that are unsecured, meaning that you don’t need to offer any of your assets (such as a car) as security to be granted a loan. The amount of money they offer is generally limited, and the repayment period is usually short. The four different types of cash advances are as follows.

Four Different Types of Cash Advance

Before you learn about the uses of a cash advance, you must first know about its different types.

Before you learn about the uses of a cash advance, you must first know about its different types.

1. Wage advances

These are short-term loans due to be repaid on your next payday. They are the low-fee alternative, typically charging a 5% flat fee on the amount lent ($5 on a $100 loan).

If you default on your payment, you don’t usually need to worry about late fees or penalties; wage advances were created with those struggling to make ends meet in mind. You will also get the money you’re trying to borrow immediately, as every transaction is done digitally.

Wagetap offers loans up to  $2,000 and a bill-split option that allows you to split your repayments into three or four equal sums, giving you convenience and peace of mind. 

2. Payday loans

Payday loans are short-term loans with longer repayment periods than wage advances. They are a higher-cost option best used for emergency expenses. Payday loans typically have a 20% establishment fee plus a 4% flat monthly fee and often have late fees and charges.

3. Credit card cash advances

These are advances that you can take out against your credit card limit from your bank. Typically, you get your money quickly, but be wary of transaction fees and high interest rates. As costs rack up you could run into debt. 

4. Bank loans

These are longer-term loans that come with lower interest rates and more flexibility. They are typically used for larger expenses like home repairs or car purchases.

Five Common Uses of Cash Advances

After looking at the different types of cash advances, you should also know how to use them. Knowing its ins and outs will help you utilise its advantages and will be able to help you better. Here are five common uses of cash advances:

1. Bill Relief

Bills can add up, whether they be for electricity, gas, water, phone, TV, or internet, and you may need additional funds to cover them all because of unforeseen circumstances. A wage advance can help you pay them upfront and relieve any anxiety about incurring late fees.

Emergencies

 When faced with an emergency, a cash advance can be a lifesaver. It can provide you with the funds you need to cover the cost of medical bills, medications, and other necessary costs. Worrying about a loved one is already hard enough, so eliminating the burden of looking for money to pay these expenses can be a relief. A trip to the dentist, depending on the state of your teeth, could also be considered an emergency. 

2. Council Rates

If you need help paying council rates, so your government can build infrastructure and other utilities to help you live comfortably, Wagetap can help you do so.

3. Groceries

Food, toiletries, and other necessities, grocery expenses add up. A cash advance can help you pay for groceries when you’re short of funds instantaneously depositing the money directly into your account online. 

4. Childcare

Children are expensive: daycare, schooling, food, medical expenses, and toys add up. Budgeting these expenses can get tricky. Wagetap helps cover childcare expenses by allowing you to borrow money at your discretion. Support your child the way you want to.

5. Car Repairs

Car repairs can be a huge inconvenience, and public transportation is often unreliable A car is the best way to travel to work, shop for groceries, and be mobile in the event of an emergency.. A cash advance can be a great way to get the money you need to cover the cost of repairs and avoid dealing with late buses and trains.

Should I Get a Wage Advance?

Whether or not you should get a wage advance depends on your situation. If you are in a financial emergency and need the funds quickly, then a wage advance can be a great option. However, it is important to make sure you understand the terms of the loan and that you can pay it back in a reasonable amount of time. 

Always remember to understand the different types of cash advances and how they can be used. Ultimately, the decision whether to use one or not is up to you. Try to spend your money wisely to avoid being short on cash in the first place.

Get Instant Cash With Wagetap and Take Control of Your Finances

Wagetap is a pay advance app designed to help you when you are in need of instant cash. There are plenty of ways to use a cash advance, and Wagetap ticks all the boxes. Whether for a medical emergency, an unexpected car repair or any bills due, Wagetap has you covered.

App Store

For additional help, you can always download Wagetap. It is a leading wage advance and bill split app that allows you to access your pay early. Emergencies can always happen, and Wagetap can help you handle life's unexpected expenses.

For additional help in improving your spending habits, you can always download Wagetap. It is a leading wage advance and bill split app that allows you to access your pay early. Emergencies can always happen and Wagetap can help you handle life's unexpected expenses.