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Huge Earning Potential With Chase Freedom, Chase Sapphire Preferred® Card and Checking Combination

by on July 26, 2011 · 73 comments

in Cash Back Rewards, Chase, Chase Sapphire Preferred, Credit Cards

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Update:  As of July 20, 2014, the Chase Sapphire Preferred Card no longer offers the 7% annual points dividend. View the current sign up offer here.

I generally don’t pay much attention to cash-back cards, because I find more value in earning points and miles that can be used for travel. With travel cards I generally get at least 3 cents per point in value, versus 1 cent usually earned with cash-back cards.

However, several readers have recently tipped me off to a lucrative way to earn 5+ points per dollar with the Chase Freedom card. And get this – if you have the Chase Sapphire Preferred® Card as well, those Freedom points can be transferred to the Ultimate Rewards partners at a 1:1 ratio (United, British Airways, Korean Air, Southwest, Hyatt, Priority Club, Marriott, Ritz-Carlton and Amtrak).

Wow.

Let’s take a look at the basics of the Freedom card.

Annual fee: $0
Sign up bonus: 10,000 points or $100 cash back with $500 spend within 3 months
Earning: 1 point per dollar spent (or 1% cash back), with rotating categories that allow you to earn 5 points per dollar (5% cash back), up to $1,500 in spend per quarter

The Bonuses

For 2012, the 5 points to $1 spend for up to $1,500 cash-back categories so far are:

January-March:
Gas Stations and Amazon.com

April-June
Grocery stores and movie theaters

Additionally, if you are a Chase checking customer, you will earn a 10% bonus on all points earned each month, plus 10 points per purchase (even if the purchase is 20 cents). The example in the Chase material from this Fatwallet thread is:

Update: The Chase Freedom card no longer offers a bonus of 10% on all purchases plus a 10 point per transaction bonus additional 10% Cash Back. Instead, both of those benefits have been replaced with a 10% annual bonus at the end of the year on all purchases.

Example: make 16 purchases spending $400 in a month

400 points: standard $1/1 point Freedom reward
+40 points: 10% bonus points
+160 points: 10 pts per transaction (16 transactions)
400+40+160=600 pts for $400 worth

So now you have a bunch of these Freedom points for cash back, but if you also have the Chase Sapphire Preferred® Card, instead of liquidating these points for a penny each, you can transfer them to any of the Ultimate Rewards partners at an instant 1:1 ratio!

So this 20,000 points (Update: bonus is now 10,000 points) on a fee-free card will almost get you a free night at any Park Hyatt, including the Maldives, which goes for over $1,000 a night (free nights are 22,000 Hyatt points).

Example Case

So let’s say you only use your Freedom card on the spend categories each quarter. That would be $6,000 in spend and you’d get 30,000 points (5%) plus 600 for the 10% checking bonus and let’s say there were collectively 60 purchases, so add on an extra 600 points. 31,200 Continental/British Airways/Hyatt/Marriott/Priority Club/Amtrak points for a mere $6,000 in spend is pretty darn good. Plus factor in the 20,000 sign-up bonus points and we are talking enough for a round-trip coach ticket to Asia on Cathay Pacific using BA miles! Or you could simply take the cash back and put $510 in your wallet – still not a bad option.

I have to admit, I haven’t done this yet, but the wheels are in motion and I’ve confirmed this strategy with multiple people. And while the general rule is to wait 1 month between Chase applications, a reader recently emailed me that he applied for two in one day and got declined for both initially, but got them approved when he called the reconsideration line. Not bad, since two applications from the same issuer will only be 1 hard inquiry on your credit. I don’t think this will work for everyone, but if you have strong credit and a good relationship with Chase, I suspect its more than possible. I think the argument could easily be made to get a Freedom card for everyday spending (in the categories) and to use the Chase Sapphire Preferred® Card for international travel since it doesn’t have a foreign transaction fee (plus it looks really, cool as Ben from One Mile at Time recently wrote about).

Does anyone here have experience leveraging the Freedom and Chase Sapphire Preferred® Card (and even Chase checking) to max out point earning?

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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{ 53 comments… read them below or add one }

infamousdx July 26, 2011 at 12:51 pm

I haven’t employed this strategy exactly but Chase Freedom used to be my daily no-fee card with the rotating categories. I was very pleased to find out that when the Sapphire Preferred card came out that I could just transfer points right to my Sapphire Preferred account. I even transferred my fiancee’s points to my Sapphire Preferred account INSTANTLY. Very nice way to use those points instead of the standard 1% cashback.

Anonymous July 26, 2011 at 12:56 pm

So…the $200 cash back can be “redeemed” or transferred to BA points, correct?

Carsten Varming July 26, 2011 at 12:57 pm

As of yesterday I can confirm this setup. The chase freedom can be incredible valuable in some quarters and pretty useless in other quarters. But the card is free so I don’t see any reason not to have it. I guess this deal isn’t really for big spenders as the categories are limited to $1500 per quarter.

As a side note; in Jan-Mar the freedom had 5% on groceries. I don’t spend $1500 on groceries in one quarter, but that quarter I stocked up on gift cards to my local grocery store and effectively advanced my grocery spend into a 5% rebate (and now a 5 points per $).

Steve July 26, 2011 at 1:11 pm

Minor math correction?
Didn’t you say the 10% bonus was on points earned, so that in your $6k spend in the 5x categories example it would be 30k plus 3k bonus plus 60*10 per transaction or 600 more for a total of 33,600 (vs the 36.6k you cited)

Nkatt July 26, 2011 at 1:16 pm

I’m confused. It seems to me that the CapitalOne Venture Card would be the best all-around card to have. They give you 2 points for every $1 spent in all categories all the time. Isn’t this the best deal?

Anonymous July 26, 2011 at 1:17 pm

My math was wrong, however I don’t believe the 10% bonus is eligible on bonus categories as well. I think it is only on base spend (like shown in the example). If anyone knows if you get the 10% bonus on top of the 5% category spend, please let me know and i’ll update.

Anonymous July 26, 2011 at 1:20 pm

Capital One Venture is great, but those points CANNOT be transferred to airlines/hotels like Chase and Amex can. So if you try booking a $10,000 business class award, you will need 1 million points (cap one points = 1 cent each towards airfare), versus as little as 50,000 points when transferring to airline programs.

dracs July 26, 2011 at 1:23 pm

I can confirm this from my last statetemt: two transactions only
10% Bonus Points per $1 You Spend 9
Bonus 10 Points on Every Purchase 20

Greg July 26, 2011 at 1:27 pm

does anyone know if points earned with the freedom card can be transferred to someone else’s sapphire preferred card?

infamousdx July 26, 2011 at 1:32 pm

I just posted that as the first comment ;)

CU July 26, 2011 at 1:37 pm

I guess my question is whether this is the best option. Following your great advice (seriously great!), I now have British Airways, Amex Platinum and Sapphire Preferred. I met the spend requirements on BA and Amex Platinum and am now working on Sapphire’s spend requirement (won’t be a problem). Once that’s done, Amex Platinum was going to be my everyday card (with Sapphire as a back-up for places that don’t take Amex) b/c of the many benefits and the fact that points accrue quickly. Assuming I get this Freedom card, what should be my go-to everyday spending card in your opinion? In other words, is it worth to take the spending/point accrual away from Amex Platinum (including shopping thru their portal) in those Freedom categories? Hope this question makes sense…

monarch20 July 26, 2011 at 2:36 pm

Some additional details on how to take advantage of the 10 points per transaction bonus:
http://www.fatwallet.com/forums/finance/1100158/

Jeff July 26, 2011 at 3:27 pm

Do you have to keep the Sapphire card open in order to transfer the Freedom points to UR points? I currently have the Sapphire card, but plan on canceling at some point to avoid annual fees. The Freedom card sounds like a good long-term card, especially if you can continue to transfer points to UR.

Latimer July 26, 2011 at 3:42 pm

your statement of “you will earn a 10% bonus on all points earned each month” should actually be “you will earn a 10% bonus for each $1 spent each month, rounded UP to the nearest whole number”. Therefore, $71 will earn you 8 points and I just verified that on my statements.

Anonymous July 26, 2011 at 4:22 pm

Yes- you need to have a sapphire preferred card open to be able to transfer to the ultimate rewards airline/hotel partners

TrentSwanson July 26, 2011 at 5:46 pm

Thanks CU.. I feel each new card, while accruing its one-time point bonus makes sense, over time cannibalizes the earnings potential of the other cards. BA Chase, AMEX Platinum, Sapphire Preferred, AMEX SPG. TPG, Could benefit from some sort of force ranking. Tx

Mike July 26, 2011 at 6:29 pm

Last year I accidentally applied for Chase United and Continental within 30 days and was denied the Continental card initially. I spent 2 hours on the phone climbing the ladder of supervisors until I hit one nice woman who felt sorry for me, looked at my credit and saw it was excellent and approved me. I would advise against doing two Chase apps within 30 days unless you are ready to do an extended battle with Chase. I tread lightly with Chase due to them having sooo many of the available offers.

Anonymous July 26, 2011 at 7:07 pm

This is very tempting to me as I have already been tossing around the Chase Sapphire Preferred 50k bonus card. I was able to get in on the Citi AA cards for myself and my husband in June, so we are on our way to a combined 300k AA miles!!! However, we are wanting to go to Greece and I decided that Star Alliance miles are better for that because of direct flights to Athens from US and the alliance with Aegean to get to Santorini. However, the options look pretty bleak for using anything less than 100k miles per coach ticket. If I do this Sapphire card (and possibly the freedom), I want to get the most bang for my buck and that appears to be converting to miles.

Does anyone have experience with the difficulty of booking a reward ticket on Continental/United, US Air, etc. Are the agents pretty helpful in trying to bounce you between Star Alliance partner airlines? I just don’t want to to sign up for the Chase Sapphire and not get the most for my time/effort!! Thanks to Points Guy and everyone who contributes. I now read this blog every. single. day. :-)

Anonymous July 26, 2011 at 7:14 pm

100k for coach? NO WAY! 100k for business is more like it :-) If you are flexible and dont mind routing through Frankfurt/London/Munich you can definitely do it. The nonstop EWR-ATH is a bit hard to get, but not sure where in the US you are, but you should be able to make it work. I’d play around at continental.com to see what options are there for sample dates.

Anonymous July 26, 2011 at 7:19 pm

I know!!! 100k was nuts to me! Ok. I will play around and see what I can find. I am a bit anal and plan way ahead, so I cannot even look at the actual dates I want yet :-) If planning far in advance, I could definitely build in flexibility with our dates. I just wanted to make sure I wasn’t going to be wasting my time trying to accumulate Continental/United miles if they are difficult to book with. Delta has given me fits in the past. Cannot subject myself to that again :-) Thanks so much!

Avi4 July 26, 2011 at 7:45 pm

Couldn’t find a reference to this condition (having an open Sapphire Card in order to transfer the UR points) on the Chase website. Could you provide a quote or a link?

Anonymous July 26, 2011 at 7:49 pm

There are three different programs at play. Sapphire regular which allows 1 cent conversions to travel, Freedom which is cash back and Sapphire Preferred which has Ultimate Rewards transfers to airlines and hotels. It just makes sense that you’d need to have a Sapphire Preferred card to be able to use the benefits of its program. I suppose you could also have an Ink Bold Plus which has the same Ultimate rewards. But if you merely have a Freedom or regular Sapphire, you cannot transfer to the airline/hotel programs.

Vishal July 26, 2011 at 11:23 pm

I have a Freedom Card and Chase checking. But I was declined for my Sapphire Preferred. Damn.

toomanybooks July 27, 2011 at 1:03 am

If going to Greece, you might want to look at the Doubletree on the island of Kos. Hilton category 2, 12,500 HH a night, an absolute steal. Frugal Travel Guy had a post several weeks ago saying if it were in a more accessible location, it would be $400+ a night. Aegean flies there.

Not that Santorini isn’t awesome as well.

PJ July 27, 2011 at 1:24 am

wow CHase Sapphire is offerring 50K bounus points with spending requirement $750/3months ; my duaghter got targetted thanks Brian for the good news freedom points can be transferred into Sapphire points

PJ July 27, 2011 at 1:33 am

I did not make it clear : THIS IS NOT SAPPHIRE preferred ; Prefeered has been offering 50K and many of us were lucky enough to get 100K. The INVITATION is for CHASE SAPPHIRE basic card.
another good feature of Sapphire Preferred is : I was told you can transfer points to all authorized users on the card just as Amex points

AAP July 27, 2011 at 4:00 am

I would try both Continental.com, as well as, http://www.aeroplan.com (Air Canada’s website). Continental has some non-Star Alliance partners (like Virgin Atlantic), and the Aeroplan websites shows availability of all Star Alliance carriers.

Then when you are ready, you can call and make the reservation (assuming you are not able to do it online).

MileCards July 27, 2011 at 4:08 am

The Continental mileage booking tool is a godsend compared to Delta’s. You will be in awe at how well it works.

Gpapadop July 27, 2011 at 1:59 pm

Well, since I recently booked award trips to Greece with my CO miles and am a Delta Platinum, here are my two cents:

You will definitely find award seats to Greece using CO miles!! Use the continental website and just a little flexibility you can get what you want and then call them to book it. Don’t just get to ATH, use SKG too if you do not plan to spend any time in Athens at all. The Doubletree in Kos island is superb as toomanybooks has pointed out. 100k CO miles should get you business, 60k in coach. And yes, Delta Skypesos blow:-)

Anonymous July 27, 2011 at 2:16 pm

Great info and it makes me feel much more confident about actually being able to use my rewards. I did the Chase Sapphire Preferred (approved yesterday!!) so I am at least 50k miles on my way to a CO reward :-) Thanks again for the pointers. I am definitely going to take a look at the Doubletree in Kos.

PJ July 27, 2011 at 5:29 pm

Confirmed by Chase: Since myself is an authorizer user on my Daughter’s Sapphire Preferred , my Ultimate rewards points under Chase Freedom Visa and Master card can all be trasnferred into the Sapphire account. Incidentally, I have discovered a way to gather enough points for a particular household/friend and relatives airline account for travel reward. >>Just add the target travel milege account holder into the Sapphire Preferred.. then points can flow from Sapphire into the travel mileage account to be patched up!! SOmehow Sapphire Preferred transfer/convert rules duplicate AMEX rules :)

PJ July 27, 2011 at 9:50 pm

somehow I’ve had Chase Freedom Visa as well as Master cards for a long long time. I need two cards since in old days you were MAXed out $300 rebate each year however 5 % on DRUG GROCERY AND GAS ALL YEARS AROUND not a bad idea to get 5 % off on these necesities up to 12,000 a year since I have two cards. Occasionally I paid 950 for 1000 Grocery GIFT cards which can be turned around to buy gift cards on GAS or HOME DEPO , Resturants when I know I am going to shop or eat.
Chase has removed the cap on Ultimate Rewards and rotate different categories for 5% rebate in different quarter of the year. If you can trust you can keep GIFT cards as well as you keep CASH then in the 1st quarter of the year you can stock up GIFT CARDS from Grocery stores ( 5 % rebate in 1st quarter on Chase Freedom cards) and use them later. a way of saving 10 % on 6000 ( if you have one card) 12,000 on 2 cards . The SHOPRITE in NJ even issues replacement gift cards as long as you keep receipts and cards proved NOT used. Thanks Chase !!

Goby July 28, 2011 at 6:20 pm

There’s been some mention of Chase Saphire Preferred members getting 100k miles instead of the stated 50k… am I missing something?

Ari July 29, 2011 at 4:47 am

So I got both AA citicards 2 days ago. And today the Amex Spg. Do you think it would be bad judgement to apply for the Chase Saphire Preffered also today.If so how long should I wait.

Ari July 29, 2011 at 4:47 am

So I got both AA citicards 2 days ago. And today the Amex Spg. Do you think it would be bad judgement to apply for the Chase Saphire Preffered also today.If so how long should I wait.

PJ July 31, 2011 at 10:39 pm

I dont think it is worthwhile to risk being blacklisted by ONE of the best banks in the world if not the best. I do know small trades with this nature is ok : say you are at a supermarket doing self check out instead of swiping a card once for 12 items, you break them into 12 swipes well small but points add up .

Recaps of other strategies on chase freedom cards I posed here
1. When possbile CARRY MORE THAN one Freedom card; sign on bonus is attractive and 1500 quarterly cap becomes 3000 a free option in life with good returns
2. Buy GIFT cards from your favorite supermarket gearing to your yearing spending patterns on grocery gas etc. Gift cards can be turned around to buy gift cards on GAS Resturants; some supermarkets let you have $1000 worh of cards for $950 which you get more than 5 % off
3. A few days ago, I even stocked up some gas cards to be used outside this quarter.

Hemi August 12, 2011 at 10:54 am

Have had the chase sapphire card for a year now, and the annual fee of $85 just got applied…spoke to several chase CSR’s who all said they could not do anything about the membership fee (which i found odd because a CSR from Citibank gladly credited me the $85 for the annual fee on both my Citi AA Amex, and AA Visa with no hesitation)…

Wanted to know if anyone had success getting the annual fee waived on their Chase Sapphire???

adam August 14, 2011 at 1:37 am

>>>Additionally, if you are a Chase checking customer, you will earn a 10% bonus on all points earned each month, plus 10 points per purchase (even if the purchase is 20 cents). The example in the Chase material from this Fatwallet thread is:

Does anyone have any Chase links that state this? I’m a new customer and I’m not sure what I have to do to enroll in this bonus. I have chase freedom card and chase checking

Quincy September 15, 2011 at 9:52 pm

I just signed up for the Chase Freedom card and opened a Chase checking account. When I called to ask about the 10% bonus, the Freedom rep said that is was not available for me. Is this a targeted promo?

Jon Gray September 21, 2011 at 2:46 pm

Hey someone please check my math. If you have the Sapphire/Freedom/Checking combo, there would NEVER be any reason to use the Sapphire at all unless you are in a foreign country or spending on travel/dining categories when those categories are not part of the Freedom bonus categories. Otherwise, the 10% bonus will outdo Sapphire’s 7% dividend, not even including the 10 pts per transaction, and you can just transfer the Freedom dollars to your Sapphire rewards account.

Melvin September 21, 2011 at 4:23 pm

I have a Chase freedom check and opened a Chase checking account online after hearing about the 10 pts/transaction promo. Just called the CSR attached to my Chase Sapphire Preferred card and was told that I am not eligible for the 10 pts/transaction. She said that promotion only is available for Chase Freedom “with exclusive benefits” cards, which may only be opened at a physical Chase branch…anyone have similar experience?

Jon Gray September 21, 2011 at 6:11 pm

I spent 20 mins on the phone with a chase freedom rep, transfered to a checking rep, then transferred to a credit card specialist, who said the benefit would be automatic once it flowed through the system, and that in theory my account could be converted to the “10 by 10″ ultimate rewards program manually if needed. Going to wait until my freedom statement closes next month and see if the points appear, if not, I’ll call again.

Logan September 23, 2011 at 2:32 am

I just applied and got the Sapphire Preferred card on Sept. 12th, and I just got a targeted offer in the mail for the Freedom card with an offer of 30,000 points after the first purchase on the card. Obviously I want to pounce on this, how long should I wait before responding the offer?

Thanks!

Anonymous September 23, 2011 at 2:35 am

The common rule is to wait a month, but even then you may still get denied. If your offer expires before Oct 12, I say go for it and talk you way into an approval via the reconsideration line (I think you have extra weight on your side since you were targeted for the offer)

Logan September 23, 2011 at 3:36 am

Thank you for the quick reply! The offer is good until November 7th. I will probably wait until the end of October to try.

MJLouise November 7, 2011 at 2:06 pm

Any hints on getting a free or low cost checking account from Chase? minimum amount on deposit etc?

John December 19, 2011 at 2:24 pm

How do you transfer points from Freedom to Prferred?

Jared February 3, 2012 at 9:28 pm

Hey Brian, got a question for you. I have had the Chase Freedom for about 6 months now, and would love to get a Sapphire Preferred, but my credit isn’t quite there yet. My parents are talking about getting a Sapphire Preferred card–if I were an AU on their account, could I transfer my miles out that way? Or could I send miles to their Chase account only to have them convert these to, say, United miles for me?

Nishanth May 7, 2012 at 10:05 pm

So, I applied for and got approved for a Chase Freedom card. When I received a card and called to activate, I was told that what I got was a Chase Freedom Ultimate rewards card, not a Chase Freedom 1010 card, which has the 10% bonus and 10 bonus points with checking and they couldn’t convert it to the other. Now, why would they have the exact same card, with no annual fee, but one card gets bonus points for each transaction. Has anyone else faced this issue?

Guest September 18, 2012 at 12:58 am

Jon Gray is REALLY smart

Bruce Farley May 12, 2014 at 12:01 am

“So let’s say you only use your Freedom card on the spend categories each quarter. That would be $6,000 in spend and you’d get 30,000 points (5%)”

I find that to be next to impossible Brian. Really? You can and are willing to blow $6K a quarter on any one of the quarterly categories? Seems to be more a pipe dream than anything else for the common folk.

thepointsguy May 12, 2014 at 11:25 am

6k a year in spend (1,500 per quarter/ 500 a month) is not totally out of the question for a large portion of the population

Bruce Farley May 12, 2014 at 11:45 am

A year I agree. I assumed you were referring to a quarter :)

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