My New Work Horse Credit Card – The Chase Freedom Card

Jul 2, 2012

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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.

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

As I’ve mentioned before, the Chase Freedom card (No longer open to new applicants) can be a great weapon in your points-earning arsenal, especially when used strategically in combination with the Chase Sapphire Preferred® Card, Ink Bold and Chase checking accounts. However, I haven’t talked much about the Chase Freedom card on its own even though I’ve been shifting more and more of my spend to it.

One of the great things about the Freedom Card is a rotating list of quarterly spending bonus categories that earn cardholders 5 points per dollar spent up to $1,500 per quarter at various types of merchants. You can always find the list at this link, but for your information, the 2012 Q3 bonus categories for July-September will be gas stations and restaurants – two places where I spend a fair chunk of their money. After that, the October-December bonus categories will be at hotels and airlines – two more huge categories for me – as well as at Best Buy and Kohl’s, so I’m planning on raking in the Ultimate Rewards points during the remainder of the year. Unfortunately, the max spend per quarter is $1,500, but still I’m earning 5 Ultimate Rewards points (which can be transferred to United and Hyatt, for example) for every day spend. That’s pretty incredible.

This year’s 5x quarterly bonus spend categories for the Freedom card.

But the bonuses don’t end there. To further maximize Chase earning, you can get still more points by having Chase checking accounts (which are free if you have a direct deposit set up or $1,500 average daily balance) through the Chase Exclusives program. Once you have a checking account you are eligible for an additional Freedom bonus of 10% on all purchases plus a 10 point per transaction bonus. So even a $1 pack of gum will earn you 12 points, a $20 shirt you’d get 32 points, a $100 purchase would be 120 points and so on.

My Chase Exclusives welcome letter explaining the benefits I get with my Freedom card including 10% bonus points on all purchases plus a 10-point per-transaction bonus.

Though I still appreciate the annual 7% dividend on all points (including the sign-up bonus) that the Chase Sapphire Preferred® Card gets me, the Freedom’s 10% bonus and 10-point transaction bonus has it beat. Plus, the Freedom has no annual fee, meaning I can keep it open forever with no penalty and it helps build my credit score by lengthening my credit history as long as its open.

The summary of my Chase Freedom activity so far.

Though I haven’t had my card long, I’ve already started earning valuable Freedom points (which I can then transfer to my Ultimate Rewards account) with just a few uses of my Freedom card on purchases that would have only earned me 1 point per dollar on most other cards. As you’ll see, I earned 3,374 points on purchases, plus a 10% bonus of 338 points and then 80 points from a 10-point per-purchase bonus and an additional 34 points from my 5% category spend bonuses (from April-June those were groceries and movie theaters- I ended up maxing out my spend in these categories, but not before this statement closed). So in all on this statement, I spent $3,374 but earned 452 bonus points for a total of 3,826 points, essentially earning a 13.4% point bonus on my spending-  number that increase drastically once I start maxing out spend categories. This was also my first quarter in the exclusives program, so I plan to maximize my earning this coming quarter – especially with the great 5x categories.

There are, however, several circumstances where I will still use Chase Sapphire Preferred® Card including travel and dining (except when these fall under the Freedom’s 5x quarterly bonuses) because the Chase Sapphire Preferred® Card always gets me 2 points per dollar spent in these categories – though I also use my Premier Rewards Gold Card from American Express for airfare since I get 3x, and my Ink Bold for office expenses since that brings me 5 points per dollar (wireless/telecommunications services, cable and satellite television and radio services, office supply stores and wholesale distributors of office supplies). I’ll also use the Chase Sapphire Preferred® Card on purchases abroad since it does not charge foreign transaction fees whereas the Freedom card charges 3%.

The other reason to keep my Chase Sapphire Preferred® Card open is that alone, points you earn on your Chase Freedom card are only good for cash back or merchandise and travel redemptions at a fixed rate of 1 cent per point, whereas the Ultimate Rewards I earn with my Chase Sapphire Preferred® Card are transferable to British Airways, Korean Air, Southwest and United, Hyatt, Marriott, Priority Club, Ritz-Carlton and Amtrak. So I need to keep my Chase Sapphire Preferred® Card or Ink Bold card open in order to transfer my Freedom points to my Ultimate Rewards account and use those points for travel. When you have multiple accounts with Chase you should get them all under one online login and then when you log-in it will give you the option to combine points. You can also combine points with anyone else by logging into and then selecting Manage Ultimate Rewards -> Combine points.

Overall Chase has me hooked – not only do they offer great sign-up bonuses, but they keep me as a customer by offering strong spend bonuses on my every day personal and business spend.

My Chase-filled wallet.


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