Double usage of the word “game” is intentional. Last Friday I’ve mentioned a new product called Chase Freedom Unlimited Visa that should be available within the next few weeks. Update: The card is now available and it pays me commission.
Basically, it comes with a very simple earning structure: 1.5 Ultimate Rewards points per dollar on all purchases. If you decide to cash out the rewards, it would amount to 1.5 % return: not bad, but not great.
Of course, the real value lies in ability to transfer to partners like Southwest, Avios, Hyatt and United, and get a potentially much better return on your points. Let’s take Southwest program. You can get roughly 1.5 cents towards “Wanna get away” fare per each Ultimate Rewards point. So, 1.5 UR points will give you approximately 2.25 cents on Southwest Airlines. That’s better than 2% you would get with a no-annual-fee Citi Double Cash card. Read this post with analysis of Ultimate Rewards program when it comes to regular family.
But there is one problem. You still need to have a premium card like Chase Sapphire Preferred or Chase Ink Plus. And those products come with a $95 annual fee. If you’ve been around my site for the last few years, you probably know that I always encourage folks to be very careful when it comes to annual fees. Of course, it doesn’t mean you should never pay them. I just hope you do the math and decide if it’s worth it.
Something I’ve seen Dan from DansDeals mention a few times to readers. He said you don’t technically need CSP or Ink Plus because as long as you have Chase Freedom or Freedom Unlimited, you can upgrade it to CSP as needed. The annual fee of $95 on Chase Sapphire Preferred doesn’t kick in immediately, so you can always downgrade it after transferring the points to airline or hotel program. I’ve never done it, but I suppose it could work. I do caution readers not to rely on this method being available at the time you need to make a redemption.
Few things to keep in mind about new Freedom Unlimited card:
1) While earning 1.5 UR points on everything is pretty good, you will do better by buying $300 Visa gift cards at Staples.com and using them for everyday spending.
I wrote a post Is $300 Visa Gift Card at Staples.com a Game Changer? which I recommend you read. Obviously, if you plan on buying expensive equipment, using credit card is preferable. But if you are willing to use gift cards for everyday purchases, buying Visa gift cards at Staples.com with your Chase Ink Plus is the way to go. Overall, if you want to collect Ultimate Rewards, it will be very hard to beat Chase Ink Plus/Chase Freedom combo. Adding Freedom Unlimited card will probably yield marginal benefit.
2) If you plan to stick with Chase Sapphire Preferred instead of Ink Plus, Freedom Unlimited is worth considering.
Having regular Freedom card is still a no-brainer, but adding Unlimited to the mix could make sense. You’ll have a trifecta of Freedom/CSP/Freedom Unlimited. Use the first one for 5% bonus categories, second one for dining and travel, and third one for everything else. However, I recommend you don’t get hung up on buying regular gift cards with Chase Freedom or Ink.
As I wrote in my post last week, you can often do better by going through third-party resellers. Sure, you can buy Olive Garden gift card at Staples with Ink Plus and get 5 points per dollar OR you can buy the same gift card at 15% off through Cardpool (my link, you’ll get $5 off your first purchase) or another store. Amazon and gas gift cards are rare exceptions, as you can’t usually get a big discount on those.
Update: My reader Audrey has mentioned that purchases from third-party reseller CardCash code as Utility category (a fluke?), so you should be able to get 5 points per dollar when using your Chase Ink Plus.
3) If you apply for new cards regularly, you won’t be able to get Freedom Unlimited due to 5/24 Chase rule.
But you should be able to convert Chase Sapphire Preferred or another Chase Freedom to this product. I actually plan to convert my husband’s CSP to Freedom Unlimited as soon as it becomes available. I currently only apply for cards that come with a decent sign-up bonus upfront, and don’t have a 2% cash back card. So, having one that pays 1.5% will be the next best thing.
Going after sign-up bonuses will still be my core strategy for the foreseeable future. I just expect it to be less lucrative overall. But free is still free.
4) As always, I encourage you to look at other cards when it comes to everyday spending.
I put together a list of “keeper” cards and best 2-card combinations for a middle-class family. I recommend you take a look and see if perhaps going after cash back or other flexible rewards currency could be advantageous. I’ve written quite a few posts on Amex Everyday Preferred and why it’s a game changer. While it has an annual fee, you can usually make up for it via various promos.
Getting several good cash back cards could also make a lot of sense. Read my post on US Bank Cash Plus Visa Of course, everyone’s circumstances will be different, so I can’t say what will or won’t work for you. If you love staying at Hyatts/ flying Southwest and would otherwise pay cash for those, then you will most likely do better sticking with UR cards’ combination.
5) Chase Freedom vs. Freedom Unlimited comparison will be very YMMV
That means “your mileage may vary.” If you are just starting out in the hobby and debating on which one of those two cards to get, it will heavily depend on your spending pattern. If you don’t like to buy gift cards from reselling sites, you might want to go with Chase Freedom. Those 5% categories can be quite lucrative, especially when it comes to gas and Amazon purchases. In all likelihood, you will average 2 points per dollar at the end of the year. I think for most people, original Freedom is a superior choice.
However, if you are a person who likes simplicity, then perhaps it’s better to get Unlimited version. Once again, I assume that you plan on accumulating transferrable Ultimate Rewards points and want to get Chase Sapphire Preferred or Chase Ink Plus down the road. Otherwise, get a decent 2% cash back card like Citi Double Cash and call it a day. To new readers: if all of this confuses the heck out of you, feel free to email me or look at my Free consulting service page.
Readers, who is excited about Chase Freedom Unlimited?
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