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Official application link: Chase Freedom Unlimited Card with 3% cash back in your first year up to $20,000 spent; then 1.5% cash back
College students are at a huge disadvantage when it comes to racking up points and miles, with limited credit histories, little to no income and little exposure to the financial world. This makes some of the best points and miles cards just out of their reach.
The Chase Freedom Unlimited answers all of these complaints, while still providing outsized benefits to those with limited credit history. Read on to see why it should be the first card on every college student’s list.
1. It Doesn’t Have an Annual Fee
They really put the “free” in Freedom Unlimited — as long as you pay your bills on time and don’t use the card for purchases outside the US, Chase will never charge you a penny for renewing this card. That means more money in your pocket to spend on food and activities while you’re traveling. But there’s a long-term benefit to this as well: You can keep this card open forever without worrying about an annual fee, and boost your credit score at the same time.
15% of your credit score is determined by the length of your credit history, or how long your accounts have been open. Starting with a no-annual-fee card that you’ll keep open for a long time is a great way to boost that number.
Before you apply for your first credit card, it’s important to know what your credit score is and to fully understand the factors that influence it. If you miss payments or spend money that you don’t have just to earn points, it will wind up costing you in both the short term and long term — and you’ll end up paying way more than any value you get in rewards.
2. It’s Relatively Easy to Get Approved
Because the Freedom Unlimited has a lower bonus and fewer perks than some of its pricier counterparts, it’s generally one of the easier credit cards to get approved for. Building credit is like chutes and ladders; a few approvals can boost your score quickly, but a rejection early on can set you back in the short term. It helps to be conservative in the early stages and apply for cards that you’re more likely to get approved for.
3. Start Building Credit, and a Good Relationship With the Issuer
It takes years of consistent payments and responsible spending to build a truly immaculate credit score, but it helps to make some friends along the way. If you’re new to credit and you show Chase that you can be responsible with the first card it gives you — make all your payments on time, don’t consistently max out your credit limit, etc. — Chase (and other issuers) will be much more likely to approve you for other excellent cards down the line.
4. No Minimum Spending Requirement for the Sign-Up Bonus
Many of the best credit cards on the market have minimum spending requirements of $3,000 to $5,000 in the first three months, but how are you supposed to do that if you don’t even have that much money in the bank? Thankfully, the Freedom Unlimited is much more manageable as it doesn’t require any minimum spending amount to earn a bonus.
The sign-up offer recently changed from a fixed $150 reward after spending $500 in the first three months (which itself was a manageable amount) to a much simpler structure. New applicants to the Freedom Unlimited will earn 3% cash back on all their purchases for the first 12 months, up to $20,000 spend. Regardless of whether you spend $500 or $20,000 in your first year, you’ll earn 3% cash back on your purchases.
5. The Bonus Can Easily Be Worth Several Hundred Dollars
While it can be hard to estimate the value of this bonus without knowing how much you’ll spend, this new offer is a serious improvement for most people. If you spend $10,000 during your first 12 months — including spend you can put on your card related to tuition, textbooks, domestic travel, dining or groceries — you’ll come out ahead relative to the old offer. The 3% cash back during your first year is 1.5% more than the card normally earns, so if you spend more than $10,000 in your first year you’ll beat out the fixed $150 bonus offer.
You’ll definitely get more value if you also hold a card that earns Chase Ultimate Rewards points, such as the Chase Sapphire Preferred Card, since you can transfer the cash back you earn with the Freedom Unlimited (or the Chase Freedom) to the other card and redeem it as points — either with a transfer partner or through the Chase travel portal. In any case, it’s nice to know that you can always walk away with a few hundred dollars in your pocket if you decide this isn’t right for you.
6. Amazing Long-Term Earning Potential
After you open your Freedom Unlimited you’ll be one step closer to possessing the “Chase quartet” of credit cards with the best bonus categories. Here’s how it breaks down:
- Chase Freedom Unlimited: 1.5% cash back/1.5x Ultimate Rewards points on every purchase (first year purchases earn 3%/3x on the first $20,000 in spend)
- Chase Freedom: 5% cash back/5x points on rotating quarterly bonus categories (such as restaurants, departments stores or transportation) up to $1,500 a quarter (activation required)
- Chase Sapphire Preferred OR Chase Sapphire Reserve: The Sapphire family offers either 2x (Preferred) or 3x (Reserve) points on dining and travel. The Reserve has a high annual fee of $450, and comes with plenty of premium travel benefits.
- Optional: Ink Business Cash Credit Card: This card offers 5% back/5x points at office supply stores and on internet, cable and phone services and 2% back/2x points at restaurants and gas stations on the first $25,000 each account anniversary year . It might not make sense when you’re a college student, but it could become a useful card down the line.
Remember: While the Freedom and Freedom Unlimited have strong earning potential on their own, they’re technically just cash-back cards. In order to unlock the full range of Ultimate Rewards redemptions, including transferring to Chase’s airline and hotel partners or booking travel directly through the Chase portal, you need to pair the Freedom Unlimited with a premium UR-earning card like the Sapphire Preferred. In addition to all the reasons mentioned above, I like starting with the Freedom Unlimited because by the time you eventually get around to opening a Sapphire card, you’ll already have plenty of points in your account ready to use!
7. The 5/24 Rule
When you first start collecting points and miles, you’re bound to be overwhelmed by a bunch of jargon. This time last year I could barely tell my URs from my MRs (Chase Ultimate Rewards points and American Express Membership Rewards points, respectively) and that’s okay. You can and should learn as you go, but it helps to be aware of one thing from the start when it comes to applying for Chase card’s: the issuer’s infamous 5/24 rule. Simply put, if you’ve opened five or more credit cards in the last 24 months (across all issuers), Chase will automatically reject you for most of its credit cards. This means that you generally want to start by filling up your five “slots” with Chase before moving on, and the Freedom Unlimited is a great way to start.
The Chase Freedom Unlimited often gets overlooked because it doesn’t offer the same eye-catching welcome bonuses you’ll find on premium cards like the Chase Sapphire Reserve or the Platinum Card® from American Express. Still, if you’re a college student or entering the points hobby with a limited credit history, there’s no shame in starting small and applying for cards that you can actually get approved for. By the time you’re ready to upgrade to a Chase Sapphire card, you’ll already have built up a meaningful stash of points and be well on your way to a free vacation.
Featured photo by The Points Guy staff.
Official application link: Chase Freedom Unlimited Card with 3% cash back in your first year up to $20,000 spent
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TPG'S BONUS VALUATION: $600
CARD HIGHLIGHTS: No annual fee + earn 1.5% cash back on all purchases after you meet the $20,000 cap
- New Offer! Double Cash Back: Earn 3% cash back on all purchases in your first year up to $20,000 spent. After that earn unlimited 1.5% cash back on all purchases.
- 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 17.24-25.99%. Balance transfer fee is 3% 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