Credit card showdown: Chase Freedom vs. the Amex EveryDay
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No-annual-fee cards are a great, low-cost way to get into the world of points and miles. They typically don’t offer rewards as lucrative or travel protections and perks as wide-ranging as premium credit cards, but they can become powerful additions to your wallet when paired with premium cards. For instance, when you pair the Chase Freedom (No longer open to new applicants) with another Ultimate Rewards-earning card, such as the Chase Sapphire Preferred® Card, you can combine your points in a single account and increase your return on spending to as much as 10% on select quarterly bonus categories.
Related reading: Chase Sapphire Preferred and Freedom Unlimited: A powerful duo
The information for the Chase Freedom has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.
Both of these cards offer bonus categories with elevated earnings. With the Chase Freedom, you can earn 5% cash back up to $1,500 in a bonus category that rotates on a quarterly basis. Past categories have included select department stores, gas stations and streaming services — all generally applicable to most people’s spending habits. However, you have to remember to activate the bonus each quarter.
Meanwhile, the Amex EveryDay offers 2x Membership Rewards at U.S. supermarkets up to $6,000 a year (then 1x). There’s also the opportunity to earn 20% more points when you make 20 or more purchases per billing period, upping the 2% to an earning of 2.4%.
The information for the Amex EveryDay credit card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.
Since the main feature of both these cards is their earning in bonus categories, it’s important to take a look at your spending habits. Do you spend $6,000 a year on groceries? If yes, then the Amex EveryDay could be a great option. If you could really take advantage of the rotating bonus categories on the Chase Freedom and pair it with an Ultimate Rewards-earning card, then that may be the winner for you.
Here’s a look at how the two cards compare:
|Benefit/Feature||Chase Freedom||Amex EveryDay|
$150 after you spend $500 in the first three months
|10,000 Membership Rewards points after you spend $1,000 in the first three months (worth $200 based on TPG’s valuations). Terms apply.|
|Earning Rate(s)||5% cash back or 5x Ultimate Rewards on up to $1,500 in purchases on quarterly bonus categories (activation required). After you’ve spent a combined $1,500 in the bonus categories in a quarter, you will earn 1% cash back on all purchases.||2x points on purchases at U.S. supermarkets (up to $6,000 in spending each year; then 1x), 1x points on all other purchases. Terms apply.|
|Points Bonus||5% cash back or 5x Ultimate Rewards on Lyft rides through March 2022.||20% more points when you use your card 20 or more times on purchases in a billing period. Terms apply.|
|Foreign Transaction Fees||Yes; 3%||Yes; 2.7%|
As you can see, the main differences between the two cards are the earning rates. The Chase Freedom offers a higher return on bonus category spending, but it’s maxed out at $1,500 a quarter and the categories aren’t announced until a few weeks prior to the new quarter, so there’s no way of knowing in advance if they will fit your lifestyle. The Amex EveryDay only pays a 2x bonus and that is also capped at an average of $1,500 per quarter, but the cap is annual and therefore more flexible. Also, you know in advance that the bonus earning will be for grocery purchases.
Another factor in deciding which card might be right for you are the transfer partners that come with each. You’ll need to determine which is more valuable to you. TPG’s most recent valuations peg both Amex and Chase points at 2 cents apiece, and both offer some of the same transfer partners — including Virgin Atlantic and British Airways. However, you may be drawn to Ultimate Rewards if you have your eyes on transferring points to Hyatt, Southwest or United, while American Express allows transfers to some programs that Chase does not, like Delta SkyMiles and Air Canada Aeroplan.
Just remember that, in order to transfer your earnings on the Chase Freedom, you must have a card that earns fully-transferable Ultimate Rewards points (like the Sapphire Preferred) and transfer points from your Freedom to that card.
You should review each of the program’s list of transfer partners. The Membership Rewards program offers 22 of them (compared to Ultimate Rewards’ 13), and it includes Hilton Honors along with added airlines such as Cathay Pacific (Asia Miles) and Hawaiian Airlines. Depending on which travel partners are more appealing to you, the value you’d get from the respective point programs will vary.
The welcome bonus
The Chase Freedom offers $150 cash back after spending just $500 in the first three months. However, if you have another Ultimate Rewards-earning card such as the Chase Sapphire Preferred or the Ink Business Preferred Credit Card, you can convert the 5% cash back into 5x Ultimate Rewards, which works out to be an upgraded value of $300 based on TPG’s valuation of Ultimate Rewards points at 2 cents each.
The Amex EveryDay card will earn you 10,000 Membership Rewards points after spending $1,000 in the first three months, which TPG values at $200. Unlike the Chase Freedom, you don’t need to pair the Amex Everyday with any other cards to change cash back into points; Amex allows you to choose either for your rewards. You can also earn 20% more points when you make at least 20 purchases per billing period, upping the 1x earned to 1.2x on everyday spend.
According to TPG’s latest valuations, American Express Membership Rewards and Chase Ultimate Rewards are both worth 2 cents apiece. In general, Chase offers higher welcome bonuses and the points are slightly easier to earn. Amex is known for its premium card perks and Membership Rewards can be harder to earn, depending on the card.
Both of these cards have the potential to offer decent cash back with no annual fee. However, it’s important to take a look at the earning categories and your own personal spending habits to see which would be more rewarding for you.
There are caveats: With the Freedom, you need to hold an Ultimate Rewards-earning card to earn fully-transferable points rather than cash back. With the EveryDay, you need to make at least 20 purchases per billing period to unlock the 20% bonus and achieve the highest possible return, and your 2x earning rate at U.S. supermarkets is limited to $6,000 in spending each year.
You should also be familiar with each program’s transfer partners so you can evaluate which card will reap the best rewards for you.
Personally, I find the Chase Freedom Unlimited and Chase Sapphire Preferred duo to be an especially rewarding pair.
Featured photo by The Points Guy
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