All About Christmas Cash Advance: What to Know Before You Borrow

The holidays can be a magical time of year. It can also feel financially stressful.

There may be a lot of pressure to spend more than you have, especially if you want to host holiday parties, visit family far away, and give gifts to loved ones. Americans are turning to credit more and more to cover costs: According to the Federal Reserve Bank of New York, U.S. credit card balances hit a record of $1.21 trillion in 2024.

If you want to get a Christmas cash advance or fast access to cash, there are no shortage of options. But turning to credit card cash advances or payday loans means you’ll likely face risks, such as absorbing high fees and falling into debt cycles.

Here’s what you need to know about the available options you have to pay for Christmas, as well as safer alternatives to consider.

What is a Christmas cash advance?

A Christmas cash advance is a short-term loan that lenders promote during the holiday season to help you cover expenses during that time. Some of these include money for gifts, travel, or parties.

These types of advances are usually offered by payday lenders, online lenders, and credit card issuers in the form of cash advances. These loans are often aimed at those who want to make the holidays feel special but may not have the finances to do so.

Christmas cash advance loans usually allow you to borrow several hundred to several thousand dollars, which you repay in full within two to four weeks. But terms can vary upon approval. These loans can be expensive and risky despite the ability to access cash quickly. For one, they involve high interest rates and fees. With credit cards cash advances, for example, you will need to pay interest as soon as you withdraw the cash.

Understanding a cash advance is crucial because this type of loan is designed to offer you convenience — but it usually comes at a steep price. Even if you need to go this route, knowing what it entails can help you make better loan choices.

The risks of borrowing for the holidays

You want to create a happy experience during the holidays for your loved ones, so it can make sense to want to borrow money during this time. But options like cash advances and payday loans can have far-reaching financial consequences.

One of the drawbacks is how much you’ll need to pay to get that Christmas cash advance. Payday loans usually come with a rate that’s close to 400% APR. That’s even if you borrow a small amount. Plus, getting a credit card advance comes with rates that are higher than your regular APR. Then there’s the upfront fees. All of these costs combined mean that it's possible for you to pay more in charges than you originally borrowed.

There’s also repayment terms. You may be asked to pay back the loans in full within four weeks, or when your next payday hits. And those due dates could occur right around when you have other bills due. If that happens, you could fall behind on your other payments.

Also, if you miss a payment or are late on one, it could negatively affect your credit score or trigger overdraft fees if you don’t have enough money in your bank account to cover the payment.

Even though borrowing money may seem like a problem-solver in the moment, you could put yourself into a cycle of debt. One loan could lead to another after increased spending over the holiday season.

Comparing common holiday cash advance options

You have many options to choose from but they could come with hidden costs. Here are some of the most common short-term loan choices and how they compare.

Payday loans

These are small loans that are typically due on your next payday. They usually don’t need a credit check but the fees can add up fast. In other words, while they might have fast approval times, they also have short repayment terms, high rates, and, in some cases, fees to roll over your loan if you can't pay it back in time.

Credit card cash advances

Credit card cash advances allow you to withdraw money from your existing credit line, usually through an ATM, at the bank or using checks provided by your credit card company.

This type of loan can work if you need cash quickly. However, interest is charged immediately, there are cash advance fees, and the interest can just keep piling up until you pay off the balance in full.

Online personal loans

Online lenders offer loans that you pay in fixed amounts over a set repayment schedule. They may offer more flexibility than payday loans because the repayment terms may be longer. You may also be able to borrow higher amounts.

A possible downside is that you may have to wait several days for funding, and the interest fees are still high, especially if you have bad credit. Some lenders may also charge fees for taking out a loan. And you may also have to go through a credit check.

Cash advance apps

Some apps may market themselves as giving you easy access to cash, but they can work a lot like payday loans — with short repayment deadlines and potential for a debt spiral. You may need to buy a subscription or pay service fees, and these fees can add up. So read the fine print as fees may not be clearly spelled out.

Pawn shop loans

A pawn loan lets you use personal items like jewelry or electronics as collateral. Then you'd be offered a certain amount of cash, which you’ll need to pay back usually within 30 days. If you can’t, then you risk losing your item.

There is no credit check, but you’re facing high fees, and the loan amount is limited to the value of your item. Some pawn shops may let you pay back the loan in installments. But in most cases, you’ll need to pay it back all at once.

Earned wage access (EWA)

Earned wage access, or EWA, lets you access a portion of your paycheck before your regular payday. The amount you can get is usually based on the hours you’ve already worked.

It’s not technically a loan because you’re tapping into money you’ve already earned. Plus, you won’t be charged interest. Some EWA providers, like EarnIn, allow you to receive funds in one to two days with its Cash Out¹ feature. Get up to $150/day, with a max of $750 between paydays — no interest, no credit check, and no mandatory fees, just optional tips³ that never affect service quality.

With EarnIn's Lightning Speed³ tool, you can get access to your pay in minutes, with fees starting at just $3.99 per expedited transaction. Most EWA apps don't affect your credit score because there is no credit check required.

EWA can be a safer, lower-risk way to handle short-term expenses compared to high-interest loans.

Tips for reducing holiday costs — without cutting joy

With some advance planning, it can be possible to create a magical holiday season without overspending:

Set a clear budget. Map out what you will spend on, whether that’s gifts, travel, or meals.
Find cost-cutting measures. Discover ways to stretch your budget — like shopping early, looking for sales, using cashback apps or coupons, or setting up gift exchanges instead of buying for everyone individually.
Embrace DIY. Homemade gifts can be more meaningful than expensive store-bought ones. A framed photo, baked treats, or a handwritten letter can go a long way without costing much.
Find free activities. Check your local community calendar for free tree lighting events, parades, or concerts. A walk through decorated neighbourhoods or a cozy movie night can also boost holiday spirits.

Make this Christmas financially stress-free

It’s normal to feel the pinch during the holidays, but try to look at borrowing money as the last resort. Going into debt for a single season can leave lasting stress, with worrying about high fees and short repayment times.

Before taking out a loan, consider what alternatives might help: budgeting ahead, cutting costs creatively, or exploring EWA tools like EarnIn. That way, you can celebrate the holidays with more peace of mind.

Please note, the material collected in this post is for informational purposes only and is not intended to be relied upon as or construed as advice regarding any specific circumstances. Nor is it an endorsement of any organization or services.

This Blog was sponsored by EarnIn. While the author received compensation, the information shared is grounded in independent research and intended to provide helpful and accurate guidance to readers.

EarnIn is a financial technology company, not a bank. Banking services are provided by our bank partners on certain products other than Cash Out.

¹A pay period is the time between your paychecks, such as weekly, biweekly, or monthly. EarnIn determines your daily and pay period limits ("Daily Max" and "Pay Period Max") based on your income and financial risk factors as outlined in the Cash Out Maxes section of our Cash Out User Agreement. EarnIn reserves the right to adjust the Daily Max and Pay Period Max at its discretion. Your actual Daily Max will be displayed in your EarnIn account before each Cash Out.

EarnIn does not charge interest on Cash Outs or mandatory fees for standard transfers, which usually take 1–2 business days. For faster transfers, you can choose the Lightning Speed option and pay a fee to receive funds within 30 minutes. Lightning Speed may not be available at all times and/or to all customers. Restrictions and terms apply; see the Lightning Speed Fee Table and Cash Out User Agreement for details and eligibility requirements. Tips are optional and do not affect the quality or availability of services.

²
Tips go to EarnIn and help us provide tools such as Credit Monitoring for free and keep Lightning Speed fees low. Your service quality and availability aren’t affected by whether you tip or not.

³
Lightning Speed is an optional service that allows you to expedite the transfer of funds for a fee. Depending on the product, the fee may be charged by EarnIn or its banking partner. Lightning Speed may not be available in all states and/or to all customers. Restrictions and terms apply. See the Lightning Speed Fee Table for details.