There is no doubt about it, for the past few years Chase has been the absolute leader in consumer credit cards. I can’t think of another card issuer out there that offers such a well-rounded group of credit cards that offer mass appeal. Specifically, Chase has done an excellent job marketing their Chase Freedom and Sapphire line-ups of cards.
Well, it seems that Chase still isn’t done making improvements to that well-rounded line-up. A few days ago Chase introduced a significant change to the Chase Freedom Unlimited Card. Personally, I think it’s a change that should have received more attention.
For A Limited Time The Chase Sapphire Unlimited Card Offers 3% Cash Back On All Purchases
For the past several years there where essentially two Chase Freedom cards. There was the standard Chase Freedom card which offers 1% Cash Back on all purchases and 5% Cash Back on quarterly rotating bonus categories.
Additionally, there was the Chase Freedom Unlimited card which offered 1.5% Cash Back on all purchases, but did not include rotating bonus categories. It’s this card, the Chase Freedom Unlimited card which recently received the major improvement in benefits.
Chase recently introduced a sign-up bonus in which the Chase Freedom Unlimited card will now earn 3% Cash Back on all purchases. However, this benefit is capped to the first $20,000 of spend or the 1st year of card membership, whichever comes first. After the offer period, card holders will continue to earn 1.5% cash back on all other purchases.
How To Maximize The New Freedom Unlimited 3% Cash Back Benefit
Although on the surface this minor 1.5% increase in Cash Back appears to be a small improvement, the implications of the change are quire large. See, Chase Freedom credit cards earn cash back, but those cash back “points” can be transferred into Ultimate Rewards points. However, you can only make this transfer if you also carry a Chase Sapphire card.
So, because I already carry an Ultimate Rewards card, the Chase Sapphire Reserve card, I can pair the card with a Freedom Unlimited card and earn 3X Ultimate Rewards points on all purchases. Additionally, I also carry the Chase Freedom card which means I’ll also earn 5X Ultimate Rewards points on up to $1,500 of bonus category spend quarterly.
So, if I max out all of this properly, I’ll earn 60,000 Ultimate Rewards points from the Freedom Unlimited and 30,000 points from the Freedom cards over the next year. That’s approximately $1,350 (90,000 * $0.015/point) of value from two no annual fee credit cards. I have to admit, that’s a pretty darn good return.
However, this offer is only valid for the first $20,000 of spend or the first year of card membership. So, I’m not sure this card is worth carrying long term and likewise, if you won’t maximize the benefit, it might not be worth applying.
What This Means For My Wallet
This is where things really get interesting (aka you can stop reading now if you want). I currently earn 5X points on Airfare purchases from the American Express Platinum card. I have no plan on closing that card. Next, I plan to open the Citi Prestige card from which I’ll earn 5X points on all dining purchases. Again, a card I plan to keep if I open it.
What’s left is the Citi ThankYou Premier card, the Chase Sapphire Reserve card, and the American Express Gold card.
I’ve kept the Citi TYP card open for years because of the 3X gas benefit, but with the Freedom Unlimited I’ll earn 3X on gas, and everything else. So, I think it’s finally time product change this card.
Likewise, I’ve had the Chase Sapphire Reserve card open for years, but if I add the Citi Prestige card I’ll have little use for it. However, I have to keep a Chase Sapphire account open in order to utilize the points transfer from the Chase Freedom cards so I may keep this open. Likewise, I’ll look into downgrading this card into either the Chase Sapphire Preferred or the no annual fee Chase Sapphire card.
Finally, I think my love affair with the American Express New Gold card is over. I just don’t have any use for the card. I still think it’s a great card on it’s own, but the card fails to offer any unique benefits given my current (planned) portfolio of cards. So, sadly, I think it’s time to ditch the Rose Gold Gold card.
Final Thoughts
I’m actually surprised this announcement didn’t receive more attention! Allowing card holders to essentially earn 3X points on ALL purchases is a huge deal even if it is just for $20,000 or 1 year.
If the Chase Sapphire Reserve card introduced the same benefit I’d bet people would get quite excited. However, generally people don’t get as excited about Cash Back credit cards.
Lastly, this change might actually have a major impact on my wallet at least for the upcoming year. After the introductory year period I suspect it will once again be time to evaluate my wallet.
