When Should You Ignore the 5/24 Rule?
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The award travel community isn’t immune from the dangers of groupthink, and there are some things we accept as gospel without ever stopping to question them. Perhaps the most well-known example is Chase’s 5/24 rule, which means that Chase will reject you for nearly all of its credit cards if you’ve opened 5 or more cards across all banks in the previous 24 months. (If you’re new to the points and miles world and don’t fully understand 5/24 or its implications, start by reading our “Ultimate Guide to Chase’s 5/24 Rule.”)
The logic that derives from the 5/24 rule is that you should make sure that your first 5 credit card applications are with Chase and Chase only. Still, there are a few times when it might make sense to ignore the overarching 5/24 rule and focus on making the best decisions for you as an individual. Today we’ll take a look at a few such cases.
Note: If you do decide to forego a 5/24 slot and apply for a non-Chase credit card, this is not a decision you should make lightly. Even in all the situations I mention below, you should spend a few days thinking it over instead of rushing to apply right away. You might even want to ask for advice in the TPG Lounge to make sure you’re making the right decision. Once you go over 5/24, it’s hard and expensive to get back under it.
When Does It Make Sense to Ignore 5/24?
You Receive an INCREDIBLE Targeted Offer
While most of the best credit card offers are publicly available for anyone to apply for, you might receive a targeted offer from time to time in the mail or online. Many of these offers aren’t worth wasting a 5/24 slot over, but there’s one that certainly can be. I’m talking about the elusive 100,000-point welcome offer after spending $5,000 in the first three months on The Platinum Card® from American Express. Some people receive mailers with a unique code inviting them to apply for this deal, while others are targeted online by going through the CardMatch tool.
TPG values Membership Rewards points at 2 cents each, making this offer worth a sweet $2,000. And since Amex only allows you to earn the welcome bonus on a credit card once per lifetime, many people wait to apply for the Platinum card until they receive this 100,000-point offer. These targeted offers are only valid for a limited amount of time and subject to change at anytime — with CardMatch the offer might even disappear if you exit your browser and come back 5 minutes later. So if you’re lucky enough to get this offer, it might be worth foregoing a 5/24 spot in order to apply.
You’re Playing in “Two-Player Mode”
Two-player mode, also known as the act of having a spouse or family member you can team up with to earn points faster, is a huge advantage when it comes to accumulating points. If this applies to you, you might find that you don’t need all of your 5/24 slots. Take the Chase Freedom Unlimited as an example. I consider this to be one of the best credit cards Chase offers, and it was actually the second card I ever applied for. This no-annual-fee card earns an unlimited 1.5% cash back (1.5x points) on all purchases, with no limits or bonus categories to worry about.
The biggest downside to the Freedom Unlimited is that its sign-up bonus is based entirely on spending. New applicants will earn 3% cash back (3x points) on all purchases for the first year on the first $20,000, up to $600 (60,000 points). That’s a great deal if you can max it out, but if you normally don’t spend that much on a credit card in a year, the value of the offer might be wasted. More importantly, if you’re in “two-player mode” you don’t need two different Freedom Unlimiteds. Player 1 can get a Freedom Unlimited and add Player 2 as an authorized user so they can still maximize their combined spending.
You Need Specific Miles for an Upcoming Trip
I always say that the people who are most successful when it comes to award travel are the ones who have a plan. Depending on what you’re trying to achieve, Chase Ultimate Rewards points might not be the best way to get you there. A prime example of this would be Qatar Qsuites, which is undeniably the world’s best business class product and a great experience for couples traveling together. If you have your eyes set on this double bed in the sky, your best bet is to book with American Airlines AAdvantage miles. In fact, Chase points would be of no use here. Chase’s only Oneworld transfer partners are Iberia/British Airways, but the distance-based Avios award charts will make flights from the US to Doha (DOH) unreasonably expensive.
Pro tip: Consider applying for American Airlines business credit cards, like the CitiBusiness / AAdvantage Platinum Select World Mastercard and the Barclaycard AAdvantage Aviator Business Mastercard to earn AA miles without using up a 5/24 slot.
You’re Interested in Earning Cash Back
While you can use the Chase Freedom Unlimited as a cash back card (that’s actually how it’s marketed), Chase doesn’t offer the most robust cash back card portfolio. When it comes to pure cash back, ideally you want a card that earns a minimum of 2% on every purchase — cash back offers a lower return than points to begin with, so you can’t afford to sacrifice another 0.5%. Maybe you opt for the Citi Double Cash Card, which offers 2% cash back; 1% back at the time of your purchase and another 1% back when you pay your bill.
Or maybe you take a hybrid approach. The Capital One Venture Rewards Credit Card isn’t a true cash back card, but it does earn 2x miles on all purchases. You have the option of transferring these miles to a number of airline partners (mostly at a 2:1.5 ratio) or using them at a rate of 1 cent each to erase eligible travel purchases made with your card. This hybrid approach gives you a higher baseline earning rate than most Chase cards, and lets you switch between fixed-value redemptions and transferable points as you please.
You’re Not Eligible for Business Cards
When you start thinking about the best ways to use your 5/24 slots, you’ll quickly realize that Chase’s lineup of Ink business credit cards are an important element. While there’s a good chance that you’re eligible for a business credit card even if you don’t realize it, many people are either not eligible or not interested in dealing with the extra hassle of applying for business credit cards.
Looking only at personal credit cards, everyone should probably get either a Chase Sapphire Preferred or Sapphire Reserve (unfortunately you can’t get both), a Freedom Unlimited and maybe a Chase Freedom as well. At this point you’ve used up 2-3 of your slots and covered all your bases in terms of core Ultimate Rewards earning cards, so what’s next? The World of Hyatt Credit Card? A United card, or maybe a Marriott card? None of these are bad choices, but they aren’t necessarily a given either. The Hyatt credit card is great, unless you’re fiercely loyal to Hilton, in which case it does you no good. Maybe you fly American instead of United, or don’t want to collect MileagePlus miles after United’s recent switch to dynamic award pricing. This will be a much more personal decision, but when it comes to using 5/24 slots on cobranded credit cards, it’s time to think for yourself instead of following the herd.
When Should You Stick With 5/24?
Like I said before, abandoning 5/24 is not something you should do lightly. Even if you feel tempted to, make sure you’re not falling into one of these traps.
You Can’t Imagine Opening 5 Credit Cards
If you’re new to the world of points and miles, you might not have had five credit cards in your entire life up until now and it can be hard to imagine opening that many in just two years. I felt the exact same way when I started this journey in my sophomore year of college — I didn’t think I would ever be able to open cards that quickly. Go figure. I ended up opening about 15 cards in my first year, and while I didn’t waste any of my 5/24 slots on non Chase cards, I do wish I’d been a little more thoughtful about which ones I’d picked.
You’re New to Points and Don’t Fully Understand 5/24
One common reason I hear for why people ignore the 5/24 rule is because they a) don’t know that it exists, or; b) are so new to the points and miles world they don’t really understand the implications of it. If you’re rushing to apply for new credit cards, you’re more likely to make a costly mistake. Sure, it might be too late for you to get this summer’s vacation for free on points and miles, but if you slow down and take your time, you’ll get better results overall.
You Don’t Have a Clear Card Strategy in Place
Last but certainly not least, it’s easy to ignore 5/24 if you don’t have a clear credit card strategy in place. While some elevated welcome offers like the 100,000 points on the Amex Platinum might be worth changing your plans over, you shouldn’t jump at every shiny welcome offer you see without having a clear plan in place. Almost every card you want will still be around after you finish filling your 5/24 slots, so there’s no reason to jump the gun.
There are two different ways to look at the 5/24 rule. While it’s an unfortunate restriction, it also makes it easy in the beginning because your choices are relatively limited to just Chase cards. 99% of the time, it makes sense to apply for Chase cards first, but there are certainly times when you’ll come out ahead if you deviate from the 5/24 rule.
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