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The new Chase Freedom Unlimited advertises a $150 signup bonus for spending $500 in 3 months, but in reality that comes in the form of 15,000 Chase Ultimate Rewards points. You’ll get an additional 2,500 points for adding a free additional user which will leave you with a total of 18,250 points after spending $500.
It has no annual fee.
The real kicker is that although it advertises 1.5% cash back, that too comes in the form of 1.5 points per dollar. When used properly those points are worth far more than 1% each.
The beauty of miles is that the sky is the limit (see the end of this post for more on that or see this post for ideas for your miles). I’ve had redemptions where my miles have been worth 50 cents each. If you’re good at the game, it’s not difficult to get a value of at least 2 cents from your miles, which would mean this card would be worth 3% cash back everywhere for you. That’s tough to beat.
If you value Chase points at 1.7 cents each then earning 1.5 points per dollar everywhere is like earning 2.55% cash back. It shouldn’t be hard to attain a value like that between Hyatt and airlines like British Airways, Iberia, Korean, Singapore, Southwest, and United.
If you value them at 1.6 cents each you would be earning 2.4% cash back. Even if you value them at just 1.5 cents each it would still be like getting 2.25% cash back and still beats a 2% cash back card.
You can pay your federal taxes for a 1.87% fee, so it can make sense to use this card to pay your taxes as long as you value Chase points at a paltry 1.2 cents each.
The good news is that you can convert this card into a Sapphire Preferred card and then convert it back. You can also convert your Freedom or Sapphire Preferred card into a Freedom Unlimited card, though you don’t get signup bonuses for card conversions. If you do convert your Freedom card into a Freedom Unlimited card, be sure to first finish the $1,500 in Q2 bonus spending.
It can be tough to get cards like Freedom or Sapphire if you have received 5 or more cards in the past 24 months, but exceptions have been made and bankers have been able to help some people with Chase checking accounts appeal a denial.
There are lots of cards that offer bonuses for spending in specific categories:
-I always max out the $1,500 of 5x quarterly spending on the Chase Freedom Visa. That’s an easy way to pickup 30K miles per year. Last year it even offered up to 11 points per dollar in December as a special “5th quarter” promotion. It has no annual fee.
-The Premier Rewards Gold Card from American Express offers 3 points per dollar on airfare and 2 points per dollar on dining, US gas stations, US supermarkets, and Uber. It is free for a year and is $195 afterward, but if comes with a $100 airline fee credit that helps offset that fee.
-The Ink Plus card offers 5 points per dollar on office supplies (including hundreds of gift cards sold by office supply stores), cell phone, internet, and telecom bills, and 2 points per dollar on gas and hotels. It has a $95 annual fee.
-The Sapphire Preferred offers 2 points per dollar on airfare, car rentals, hotels, and dining, plus it comes with travel insurance and free primary car rental insurance. It’s free for the first year and then has a $95 annual fee.
-The Amex EveryDay Preferred Credit Card is one of the best hybrid card offerings because it offers a great value for everyday spending and spending in select categories. If you have 30 transactions per month it offers 4.5 miles per dollar at US supermarkets, 3 points per dollar at US gas stations, 2.5 points per dollar on Uber, and 1.5 points per dollar everywhere else. That’s an excellent all-around card, but it requires discipline to make sure that you reach 30 transactions per month. It has a $95 annual fee.
-The Amex EveryDay Credit Card has no annual fee and if you make 20 transactions per month earns 2.4 points per dollar at US supermarkets and Uber, and 1.2 points per dollar elsewhere. It’s the only no-fee card that allows you to transfer points into miles.
-For everyday spending without needing 20 or 30 transactions per month the long-time gold standard has been the Starwood Consumer AMEX and the Starwood Business AMEX. The built-in 25% bonus when transferring points into miles means that you effectively earn 1.25 miles per dollar and Starwood has an awesome array of airlines. Alas transfers from Starwood take a few days and while SPG is safe for now, it won’t be around for more than a couple of years due to Marriott taking it over. And the Starwood card’s only bonus category is for spending money at Starwood hotels.
-For my everyday spending I’ve been using a United Club card as that earns 1.5 miles per dollar spent. That card normally has a whopping $450 annual fee, though I only pay $40/year for it as a lifetime club member and a United 1K. It’s a great card, but the miles are locked into United.
So the Freedom Unlimited offers a unique value proposition. It has no annual fee. It doesn’t require that you make a certain number of transactions per month. And it offers 1.5 points per dollar everywhere. Its’ only Achilles heel is that it requires that you, a spouse, or an authorized user on your account has a Sapphire Preferred or Ink Plus in order to transfer its points into hotel points or airline miles. As Chase allows you to upgrade to Sapphire Preferred and downgrade back to Freedom or Freedom Unlimited that’s a not a big deal though. It even has a huge advantage over the $450/year United Club card in that the points can be transferred to Chase’s other excellent airline and hotel partners and aren’t locked into United miles.
Will you switch your everyday spending to Freedom Unlimited?