Why earning 5x points while still sitting on the couch is extremely easy this quarter

Oct 15, 2019

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Most credit cards have the same set of bonus categories 365 days per year. You know the ones… things like 2 points per dollar on travel and dining on the Chase Sapphire Preferred Card or 4 points per dollar spent at U.S. supermarkets (up to $25,000 per year; then 1x) and dining on the American Express® Gold Card.

Other cards like to keep you a bit more on your toes. While it requires more mental brain space (or Post-it notes) to keep up with rotating bonus categories for the cards that change things up every quarter or so, doing so can be extremely rewarding — especially when the bonus categories land on an easy-to-use type of spending.

(Photo by Isabelle Raphael/The Points Guy)
(Photo by Isabelle Raphael/The Points Guy)

As it happens, we’re in one of those times right now. Through the end of the year, the no-annual-fee Chase Freedom card has some pretty great 5% cash back (5x point) bonus categories: PayPal, Chase Pay and department stores. All of these can be useful for different types of transactions, but PayPal is my favorite of the bunch as it allows you to earn 5% cash back (5 points per dollar) on almost anything you buy online and beyond.

Chase Freedom is currently offering a sign-up bonus of $150 (or 15,000 points) after you spend $500 on purchases in the first three months.

When shopping online, it’s very common for PayPal to be a checkout option, as shown below at HomeDepot.com. If you select that option and then pay via PayPal with your Chase Freedom, then as long as you activate the 5x bonus by Dec. 14, 5x points are yours — up to the $1,500 quarterly maximum for the 5x bonus categories.

Pay for your HomeDepot.com purchase with PayPal.
Pay for your HomeDepot.com purchase with PayPal.

But what about other PayPal options, like sending money to someone else? As luck would have it, my family had lots of PayPal transactions in the last couple weeks to test out. I was very curious to see if you would really earn 5x points per dollar on all PayPal charges — even the ones where you’re paying back a friend. So we ran PayPal/Freedom tests with the following retailers:

  • Lululemons
  • A local farm
  • A local school donation
  • Paying back a friend
  • Paying for some goods purchased with a Paypal.me link
  • Ordering the kid’s volleyball pictures

The results? From sending cash to a friend to shopping via online retailers with the PayPal checkout option, all of the different types of PayPal charges I tested with my Freedom indeed coded as 5 points per dollar.

For instance, I owed a friend $120 that I sent via PayPal. As usual, there’s an added fee when using PayPal to send money to a friend (though not usually when checking out with an online retailer). In this case, the fee was $3.78 to send $120. However, I earned 619 points on that charge. Since I also have a Chase Sapphire Reserve, those 619 points are worth $12.38 based on TPG’s point valuations, which is obviously more than the $3.78 in fees it cost me to earn the points.

If you don’t also have a premium Ultimate Rewards card, then the points earned on the Freedom are worth 1 cent each, which would be $6.19 in the example above, which is still $2.41 more than the fees.

So while some credit card bonus categories are easier to use than others, don’t underestimate the extremely easy earning power of Chase Freedom + 5x on PayPal through the end of 2019.

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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