Bonus Category Overlap: When To Use Sapphire Preferred vs. Freedom vs. Premier Rewards Gold

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Update: Some offers mentioned below are no longer available. View the current offers here – Premier Rewards Gold Card from American Express

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 always think twice (or thrice) when deciding what credit card to use for every purchase I make. While a big portion of maximizing miles and points is in the redeeming process and knowing how to get the best awards possible, it’s just as critical to maximize every single dollar you spend to bank the most miles and points for your buck.
From now until September 30, 2012, the Chase Freedom is offering 5 points per dollar spent on the first $1,500 spent at gas stations and restaurants. While I spend a lot in those two categories, this has thrown me for a loop because I normally put restaurants on my Sapphire Preferred (for 2.14 points per dollar: 2x base plus a 7% annual dividend) and gas on my American Express Premier Rewards Gold (2.5 points per dollar: 2x base plus Amex gives a 15,000 point bonus when you hit $30,000 in spend, essentially making the first $30,000 spent worth 1.5 points per dollar base earning).

My Strategy
Since the Freedom’s 5x points is far superior to the other two my main goal is to max out the $1,500 in spend, which isn’t hard to do over 3 months of spending. I also get a 10% bonus and 10 extra points per transactionbecause I have a Chase checking account, which makes Freedom card bonus categories way too lucrative to pass up.

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.

I value Ultimate Rewards points over American Express Membership Rewards points, so I want to put as much gas on the Freedom card as possible, so I don’t eat up that whole $1,500 with dining spend, because I want all excess dining spend on my Sapphire Preferred for the 2.14 (if I overspend on the $1,500 on the Freedom I’d be earning just 1 point per dollar on dining!). Update: The Chase Freedom card no longer offers 10% cash back when you shop online at select merchants through Chase.

Doing this takes a little bit of planning, but I basically charted out how much I plan to spend on gas until September 30 and then carved out a chunk that I should spend on dining. This doesn’t need to be 100% exact, because if I spend less than I thought at gas stations, I can always buy gift certificates right before the quarter comes to an end. An alternate strategy would be to just focus the Freedom on gas stations and buy up gift cards with whatever remainder is left, but I’m personally not a huge fan of having tons of gift cards laying around because I find them annoying to use and lug around with me since my wallet is already chock-full of plastic.

I’ve had to condition myself to not use the Premier Rewards Gold on gas this quarter, but I have still been using it for airfare (3x points per dollar) and groceries (2x points per dollar.)

Remember, if you have a Freedom card, the 5x points earned are marketed as cash back, but Chase actually allows you to combine points, so you can get the 5x bonus categories and then instantly move those points into your Sapphire Preferred or Ink Bold/ Plus Ultimate Rewards account, which makes those points transferable to United, British Airways, Southwest, Korean, Hyatt, Marriott, Ritz-Carlton, Priority Club and Amtrak. I look at it that I’m earning 5 United miles per dollar spent on popular spend categories, which is a pretty incredible deal (I value United miles at 2 cents a piece, so its like getting a 10% rebate), especially since the Freedom card has no annual fee! Note: You have to activate the 5% bonus categories each quarter and you have until September 14, 2012 to activate the current gas station/restaurant categories (thankfully registration is retroactive so you will get credit for all spending that quarter).

Future Freedom Bonus Categories:
October-December 2012: Hotels, Airlines, Best Buy, Kohl’s

Having Multiple Freedom Cards
To really maximize Freedom earning, you can get both the Freedom and MasterCard versions of the card. This way, you can earn up to $1,500 a quarter/$6,000 a year x 5 points x 2 cards = 60,000 Ultimate Rewards points a year from bonus category spend. 60,000 points transferred to United can get you one-way to Asia in business class – easily a $3,000 value – not bad for only spending $12,000, that’s a 25% return on your spend. Chase even confirms that you can have multiple Freedom cards and max out the bonus on each of the cards per this FAQ question:
Q. If I have multiple Chase Freedom cards, do I need to activate all accounts?
A. Yes, please activate all of your Chase Freedom cards to make sure you earn 5% cash back in bonus categories on up to $1,500 spent on each card each quarter.”

If you are given a pending decision or declined for a second card, you can always chat with the friendly folks at the reconsideration line at 1-888-245-0625 and let them know why you need two Freedom cards – like being able to use Visa or Mastercard at certain vendors that might only take one or the other or that you like to split your personal finances on two cards to help better track certain types of expenses.

Freedom Visa Application Link
Freedom Mastercard Application Link

The best beginner points and miles card out there.
Chase Sapphire Preferred® Card

The Points Guy Assessment:

The Chase Sapphire Preferred is a great pick for the beginner and the frequent traveler. The CSP has superb travel benefits, double points on certain purchases, and a 50,000 point sign up bonus. The $95 annual fee is waived the first year so this puts it as one of the less expensive cards, while still allowing you to earn one of the most valuable point currencies.

Apply Now
More Things to Know
  • Earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $625 toward travel when you redeem through Chase Ultimate Rewards®
  • Chase Sapphire Preferred® named a 'Best Travel Credit Card' by MONEY® Magazine, 2016-2017
  • 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
  • No foreign transaction fees
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 50,000 points are worth $625 toward travel
  • No blackout dates or travel restrictions - as long as there's a seat on the flight, you can book it through Chase Ultimate Rewards
Intro APR on Purchases
Regular APR
17.74% - 24.74% Variable
Annual Fee
$0 Intro for the First Year, then $95
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent Credit

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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