How I Divided My Ultimate Rewards Stash Before Converting Chase Sapphire Preferred to Freedom Unlimited

I’ve mentioned before that I’m very cheap when it comes to paying annual fees. If I’m going to shell out money each year, there better be some tangible benefit I gain in return. And no, earning two points per dollar on dining doesn’t count. I do pay annual fees on some cards, but in exchange I get perks which IMO make the juice worth the squeeze. Low spenders like myself need to be very careful not to buy into the hype of renewing a card just because it provides a benefit or gives extra points in one category.

One card I have no intention of renewing is Chase Sapphire Preferred. Don’t get me wrong, I think it’s a good product for some, especially those who put close to six figures on credit cards each year. It provides primary car insurance, plus offers trip delay coverage even on award tickets (see this post on VFTW). I think most business travelers who buy lots of airplane tickets and spend a ton on dining will probably benefit from having it in their wallet year after year.

But normal family? I don’t see it. While trip delay coverage is a decent perk, it’s not sufficient  because you will still need medical and evacuation coverage, not to mention, solid  cancellation and trip interruption (not to be confused with “trip delay”) benefits. Primary car rental benefit? Nice, but this year we don’t plan on renting any cars at all.

Two UR points on dining and travel purchases? I mostly use miles and points for trips and channel my spending toward new credit card sign-up bonuses. Besides, if those categories were that important to me, I would just get Sam’s Club MasterCard. Of course, as always, I encourage you to do the math because your situation may differ from mine.

But what about ability to transfer to travel partners like United, Hyatt and Southwest on 1:1 basis, not to mention new 5/24 rule? After all, I may never be able to apply for Chase Sapphire Preferred again (weeps). Hang on, I’ll get to it in a minute.

The other day my husband and I were in Carrabba’s with our friend who recently got Chase Sapphire Preferred via recommendation from yours truly. He pulled it out of his wallet to pay the bill and mentioned how much he likes the look of the card, well, getting almost 60,000 points doesn’t hurt either.

I said that he needed to figure out what to do with his stash within a year before converting CSP. He got this horrified look on his face. His words: “You mean I won’t have this card anymore?” I told him he can still  look at it, gently stroke it from time to time, and even keep it under his pillow at night. It just won’t work for purchases. Of course, I explained all the reasons why he probably won’t benefit from paying $95 per year. I have a feeling he’ll end up renewing it anyway!

black model

Image courtesy of Ambro at FreeDigitalPhotos.net

There is something very wrong with this stock photo model…

Naturally, when the time came to renew my husband’s Chase Sapphire Preferred, there was no dilemma. The card was going to be canned, aka converted to new Chase Freedom Unlimited. I suppose we could call and see if Chase would waive $95 annual fee, but it would require my husband’s involvement. No thanks. He is going to the dark side lately and constantly complaining about switching credit cards in his wallet.

But first I needed to divide the stash of almost 78K UR points. I’m including the amount from my Chase Freedom because points are combinable with my husband’s. As long as it’s your spouse or domestic partner, you can transfer points back and forth to each other. See this infographic Chase point transfer rules made simple on Frequent Miler for more.

I’ve mentioned awhile back that I dumped 8,000 points to Hyatt for a specific redemption I also transferred 30K points to United. Why? My sister-in-law is supposed to come with us to Europe next year and this will hopefully cover her one-way award ticket back to US. I’m using AAdvantage for flights to Europe.

The rest? I left it sitting in the account. What??? Wouldn’t it be much better to transfer them to Southwest where I can get 1.5 cents per point toward flights? I already have 120K Rapid Rewards points and 100K more coming my way. This should take care of the next three years worth of vacations since it’s unlikely we’ll be flying Southwest more than once per year.

But what about having United miles on-hand in case of emergency back in Belarus? I’ve mentioned that I was thinking about transferring some points for that reason. But here is the thing.  I’m hoping that if the need arises, I can still have my United miles after all. How come? I can simply convert my husband’s Chase Freedom Unlimited or my regular Chase Freedom to Chase Sapphire Preferred.

I did this particular conversion  through secure message, and it took a total of three hours for Freedom Unlimited to show up in my husband’s profile. I believe if true emergency back home arises, I can just call and convert either my Freedom or Freedom Unlimited to CSP within a matter of minutes. Then, after the transfer is complete, I can downgrade the card again.

Of course, I’m assuming there is even award availability on Lufthansa, United partner. If there isn’t, I can look into using AAdvantage miles or simply pay for a  ticket. I didn’t cash out my  40K UR points for $400, I simply left them sitting in the account waiting for the perfect opportunity to utilize them. Who knows, it may even be a category 1 Hyatt down the road.

So, why didn’t I just leave 30K UR points in the account instead of transferring them to United? After all, the transfer is instant, so why lock in the points prematurely? Because there is some uncertainty in whether I’ll be able to convert the card to CSP when the time comes. I’m fairly sure that we will be able to utilize this United redemption, so don’t want to take a chance. Besides, I would rather save this option for true emergencies so I don’t draw attention needlessly.

I’m like reader Cheapblackdad who said  he subscribes to DBI rule when it comes to dealing with banks. Don’t Be Interesting. BTW, the rule does not work in blogging.  I think if I started to flip flop between CSP and Freedom, it would draw unwanted attention. Besides, I may need to cash out this stash for real American dollars. Not all emergencies involve flights or hotel stays. Shocker!

Readers, what do you think of my split?

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10 thoughts on “How I Divided My Ultimate Rewards Stash Before Converting Chase Sapphire Preferred to Freedom Unlimited

  1. In essence, you are keeping a UR emergency fund, dependent on making the unlimited>CSP conversion in the future. It saves you $95. Not bad if it truly works.

    Are there data points that suggest one can convert the unlimited to a CSP? Or did chase confirm this with you?

    I rate the CSP a keeper. My wife has kept herd open since she first got it. I like Chase to be happy with us, so we pay the occasional annual fee with then. Combine that with the transfers and the fact that we eat out more than is like, and that she can buy food for her accounting firm team on a regular basis and be reimbursed and we are regularly pulling on 4 figure UR sums every month.

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    • @Cheapblackdad That’s exactly right. I’m counting on ability to convert either Unlimited or Freedom to CSP when/if the need arises. I’ve seen Dan from DansDeals blog mention it a few times as an option, and I don’t see why it wouldn’t work. Reportedly, the annual fee of $95 isn’t billed right away, so you can potentially convert it back after the “deed” aka transfer is done.
      As far as keeping CSP long-term, it’s definitely YMMV kind of thing. I absolutely don’t think there is anything wrong with renewing it, I’m simply encouraging people to do the math before passively paying $95 each year. That adds up over time. You’ve mentioned your reasons for renewing it, and they make perfect sense. #CSPForever

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    • @Cheapblackdad Forgot to mention. There aren’t any data points yet on converting Unlimited to CSP because the card just came out. But I don’t see why it would be any different from regular Freedom. Unlimited earns UR points that are combinable with those earned through CSP and INK. The fact that they let me downgrade CSP to Unlimited suggests that those products are interchangeable. I do have regular Freedom as well, so between those two cards it should work, I hope. Maybe I’ll never be in a situation where I have to test it out. Who knows, Chase may relax the rules in the future. Some people report being successful already in spite of 5/24 rule.
      BTW, there are quite a few reports that folks can get Unlimited in spite of 5/24 rule as long as they apply over the phone or in-branch.

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  2. I’m not following you…if you have dumped the CSP, and thus have no card that can transfer URs into points/miles, how are you going to convert 40K URsto Hyatt points for a cat 1 Hyatt? Are you counting on being able to upgrade back to CSP like CBD speculated? Or are you thinking that $400 cash is good for a night or two at a cat 1 Hyatt? I thought CFU was still a standard cash back card unless you combined it with CSP/Ink. Unlike, for example, the no-fee Amex Everyday.

    Why not get Ink Plus on the next big bonus? You’ve been clearly running a blogging/travel consulting business for nearly 3 years. Anybody can see that if you point them to the site. Maybe you are not making “Titan” money but it is still some business income at some level so you certainly qualify. If you’re worried about Chase scrutinizing every charge as you work towards the signup bonus target and making a judgement call about whether that specific purchase is truly related to your business – as Sweet Brown would say, ain’t nobody got time for that. The types of businesses that exist in the world and their related expenses are truly infinite. Seriously…there are corporate execs who have “personal appearance” expense accounts which can mean anything from getting their hair/nails done on a regular basis, designer clothing, or having a high-end car/house to keep up with the executive Joneses. And they charge it to a corporate card.

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    • @Erik Sorry for confusion! I don’t think I made the post clear enough. As I’ve told CBD, I hope to be able to convert ether Unlimited or Freedom to CSP when the need arises. It’s not a sure thing, of course, and I don’t recommend it to those who will definitely need the ability to transfer points. The thing with me is, I don’t have a clear need for transferrable UR points in a near future. I would hate to lock them into one program, be it Hyatt, United or whatever. Yeah, I was talking about transferring 5,000 points to Gold Passport for Cat.1, though in all likelihood, I would end up using other programs like IHG. The biggest appeal for me would be United if something happened back home n Belarus. Those last-minute tickets to Europe can be expensive!
      As far as applying for Ink, that’s a tough one… I thought about it. Maybe I’ll just buy groceries with it and include photos of me eating in my posts. Boom! Business expense. 🙂 I’ll have to think about it some more, but it’s tempting. Maybe I can find an angle that wouldn’t feel deceptive. It’s a slippery slope, so I have to be careful. I’m not telling others how to do things and am not judging anyone. But yes, this blog is most definitely a business, based on how much time and energy I put into it. I like to think of myself as a mini-titan!

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  3. Your post just reminded me to look at my husband’s CSP that is coming up on its one year in April. We decided to cancel it, and I was able to transfer about 600 UR points to my account. I’m still hoping that I can get approved for the CSP someday and that Chase will relax the 5/24 rule.

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  4. Out of curiosity, if my wife downgrades her card to one of the Freedom cards, and I am an authorized user, can she transfer points gained using those cards to my UR account still? Since we both have CSP and are auth users on each other’s accounts, I figure as long as we keep one CSP open, we will continue to have the ability to transfer the points out. Do you know if that will work, or will she no longer be able to transfer her points to me because she doesn’t have a CSP or Ink?

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    • @Doug Yes! She absolutely can transfer the points to your CSP account after downgrading the card. That’s what I initially did with my Freedom because I was planning on transferring points to various travel partners via my husband’s CSP. I don’t have CSP myself and haven’t had it for years. As long as she has Freedom or Freedom Unlimited, she can combine the points with yours. There really is no good reason to have more than one premium Chase card (CSP or Ink Plus) in the same household. You would be paying double in fees needlessly.

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  5. Pingback: When Tragedy Strikes, Miles and Points Aren’t Always the Answer | Miles For Family

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