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Update: Some offers mentioned below are no longer available – The Amex EveryDay® Preferred Credit Card from American Express
With the introduction of the Chase Freedom Unlimited Card, points and miles enthusiasts have a great new option for earning valuable rewards on non-bonus spending. Below, TPG Points & Miles Editor Sarah Silbert compares this new card with another product that can earn up to 1.5x points on everyday spending: the Amex EveryDay Preferred Card.
Chase recently announced the Freedom Unlimited cash-back card, which earns you a flat 1.5% back on all purchases with no annual fee. When you pair this product with an Ultimate Rewards-earning card to turn cash back into travel rewards, the Chase Freedom Unlimited is a particularly solid option, earning you a 3.15% return on all purchases (based on TPG’s latest valuations). Currently, the card’s offering a sign-up bonus of $150 when you spend $500 in the first three months, plus an additional $25 bonus when you add an authorized user and have them make a purchase in the first three months.
Now that you can apply for the card online rather than only at a Chase branch, you may be wondering how this card stacks up against other products. In today’s post, I’ll compare the Freedom Unlimited to another card that offers 1.5 points per dollar on non-bonus category spending (with a caveat): the Amex EveryDay Preferred Credit Card from American Express.
1.5x Ultimate Rewards vs. 1.5x Membership Rewards
So, why these two cards? Well, both of these products technically offer 1.5x points on everyday, non-bonus-category spending, making them some of the most valuable options for many purchases. With the Chase Freedom Unlimited, this requires also holding an Ultimate Rewards-earning card such as the Chase Sapphire Preferred or the Chase Ink Plus Business Card, since this is the only way to convert the 1.5% cash back into 1.5 Ultimate Rewards points per dollar.
While you don’t need to hold any other cards to earn 1.5x points per dollar with the Amex EveryDay Preferred Credit Card, you do need to make 30 purchases in each billing period. Once you meet this threshold, you’ll get a 50% point bonus, boosting the earning rate for non-bonus-category spending from 1x to 1.5x. This bonus also raises the rates for US gas station purchases (from 2x to 3x) and US supermarket spending (from 3x to 4.5x on up to $6,000 in purchases per year), but for the purpose of this post I’ll focus on the everyday spending rate, since the Chase Freedom Unlimited doesn’t offer any bonus spending categories of its own.
Of course, not all loyalty currencies are created equal, so another factor to consider in this equation is the value of the respective points you’ll earn with these cards. According to TPG’s latest valuations, American Express Membership Rewards points are worth 1.9 cents apiece, while Chase Ultimate Rewards points come in at 2.1 cents apiece. So earning 1.5x points with the Chase Freedom Unlimited equals a 3.15% return, but with the 50% bonus for meeting the 30-purchase threshold with the EveryDay Preferred Card, you’ll be getting just a 2.85% return on everyday spending.
The cards’ differences are a lot to keep track of — to simplify the comparison, here’s a chart:
|Benefit/Feature||Chase Freedom Unlimited||Amex EveryDay Preferred|
|Welcome Bonus||$150 after you spend $500 in the first three months, plus $25 when you add an authorized user and make a purchase in the first three months||15,000 points after you spend $1,000 in the first three months (worth $285 based on TPG’s valuations), or 30,000 points after you spend $2,000 in the first three months (targeted). Terms Apply.|
|Earning Rate(s)||1.5% cash back on every purchase, or 1.5x points on every purchase if you pair the card with an Ultimate Rewards-earning product||3x points on purchases at US supermarkets (on up to $6,000 each year), 2x points at US gas stations and 1x on everything else. Terms Apply.|
|Points Bonus||None||50% more points when you use your card 30 or more times on purchases in a billing period. Terms Apply.|
|Foreign Transaction Fees?||Yes; 3%||Yes; 2.7% Terms Apply.|
|APR Intro Rates||0% intro APR for 15 months on purchases and 0% intro APR for 15 months on balance transfers; after the intro period, a variable APR of 16.74% – 25.49%.||0% intro APR for 12 months on purchases and 0% intro APR for 12 months on balance transfers; after the intro period, a variable APR of 13.99% to 23.99%. Terms Apply.|
As you can see, the main differences between the two cards are the earning rates, along with whether or not there’s a points bonus. And while the Chase Freedom Unlimited offers a higher return on everyday spending, deciding between this card and the Amex EveryDay Preferred requires determining which transfer partners are more valuable to you. While TPG gives a slight edge to the Ultimate Rewards program due to an across-the-board transfer rate of 1:1 and some solid partners including Hyatt, Marriott, Southwest and United, American Express’ Membership Rewards program could be more up your alley depending on your travel preferences.
For one thing, the Membership Rewards program offers 19 travel transfer partners to Ultimate Rewards’ 10, and it includes Hilton HHonors along with more airlines such as Cathay Pacific (Asia Miles), Emirates and Hawaiian Airlines. More isn’t necessarily better, but depending on which travel partners are more appealing to you, the value you’d get from the respective point programs will vary.
Also consider that the Chase Freedom Unlimited Card has no annual fee while the Amex EveryDay Preferred Card will set you back $95 per year. That said, the latter card does offer bonus spending categories while Chase’s card does not, so you have the opportunity to earn up to an 8.55% return on US supermarket spending (though note that this is capped at $6,000 in purchases each year). Assuming you’re using either card exclusively at grocery stores, you’ll need to spend $1,759 with the EveryDay Preferred card to recoup the $95 annual fee.
The recently introduced Chase Freedom Unlimited Card is hard to beat when it comes to everyday spending, and the 3.15% return on every purchase is even more impressive considering this is a no-fee card. However, if you can maximize the Amex EveryDay Preferred Credit Card and its 50% points bonus, this product could also be a valuable option.
While both cards can earn you 1.5x points on everyday spending, it’s important to consider the caveats (for the Freedom Unlimited, you need to hold an Ultimate Rewards-earning card to earn points rather than cash back, while you need to make at least 30 purchases per billing period with the EveryDay Preferred to get 1.5x points). You should also be familiar with each program’s transfer partners so you can evaluate which option will reap you the best rewards for you.
What’s your favorite card for earning 1.5x points on everyday spending?
- Unlimited 1.5% cash back on every purchase - it's automatic
- Earn a $150 Bonus after you spend $500 on purchases in your first 3 months from account opening
- 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 16.74-25.49%. Balance transfer fee is 5% of the amount transferred, $5 minimum
- No minimum to redeem for cash back
- Cash Back rewards do not expire as long as your account is open
- Free credit score, updated weekly with Credit Journey℠
- No annual fee