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If you’re into earning points through credit card spending, you shouldn’t be earning just a single point per dollar spent. Rather you should be earning anywhere from 1.5-5x points on all of your spending.
This is done both by maximizing the points you’re earning for non-bonused spending, as well as by having credit cards that offer valuable bonus categories, which can often earn you 2-5x points. Thanks to a combination of using the right cards for everyday spending and the right cards for bonus categories, I’m earning an average of over three points per dollar spent.
In this post, I wanted to take a closer look at a popular no annual fee card that earns up to 5x points on spending.
Chase Freedom Card Basics For May 2020
The value you get from those points varies significantly based on what other cards you have, though. For example, at a minimum, those points can be redeemed for one cent each, and at best they can be converted into Ultimate Rewards points, which I value at 1.7 cents each.
Chase Freedom Welcome Bonus Offer
The Chase Freedom has a sign-up bonus of 20,000 bonus points after spending $500 within three months. That’s marketed as $200 cash back after spending that amount, though there are many ways you can redeem those points.
The Freedom Card is not available to those who currently have this card, or previous cardmembers that have received a new cardmember bonus on the card in the past 24 months.
Chase has something that’s known as the 5/24 rule. With this, you typically won’t be approved for the card if you’ve opened five or more new card accounts in the past 24 months. So if you do apply for this card, make sure you’re under that limit.
Chase Freedom No Annual Fee
The Freedom Card has no annual fee. You can also add authorized users at no extra cost, so that you can earn rewards for their spending.
Chase Freedom Card Rewards Structure
There are certain categories where you’ll want to put spending on the Chase Freedom, and other categories where you won’t want to. Let’s take a closer look at those.
Chase Freedom 5x Points In Rotating Quarterly Categories
What makes the Freedom Card so great is that it offers 5x points in rotating quarterly categories. Card members who register can earn 5x points on the first $1,500 they spend on combined purchases in those categories each quarter.
This concept is intended to keep cardmembers engaged, and offer some awesome rewards for spending in certain categories. Obviously, the value of these categories will vary by consumer per quarter, since not everyone has the same spending patterns.
Here’s the Chase Freedom calendar, that’s always updated with the latest bonus categories.
How To Register For 5x Points Bonus
Earning the 5x points does require registering every quarter. Registration always opens on the 15th of the month prior to that quarter, and stays open until the 14th of the last month of the quarter.
In other words, the first quarter bonus runs from January 1 through March 31, and you’d need to register between December 15 and March 14. Registration is easy, and just requires entering your last name, last four digits of your card, and zip code.
How To Track Your Spending
The Chase Freedom limits you to earn 5x points on the first $1,500 spent each quarter in eligible categories. This is based on cumulative spending in all categories that are bonused that quarter. In other words, if the bonus category is for gas stations, internet, cable, and phone services, and select streaming services, your first $1,500 of combined spending would be counted.
To track how much you’ve spent that quarter, log into your Chase online account, select your Freedom Card, and then you’ll see a link that lets you track your rewards for that quarter.
It will show a scale of $0 to $75 back (in this case $75 is equal to 7,500 points). So that will tell you how far along you are to maximizing the category.
Chase Freedom 5x Points With Lyft
Through March 2022, the Freedom Unlimited offers 5x points (or 5% cash back) on all Lyft rides. That’s an excellent return on Lyft spending.
1x Points On Other Purchases
For purchases outside of the quarterly bonus categories, or for purchases above the $1,500 quarterly limit, you earn 1x points per dollar spent. Personally, I wouldn’t put that spending on the card, because that’s not a great return.
3% Foreign Transaction Fees
While the Freedom Card is great for the 5x points categories, be aware that the card has 3% foreign transaction fees, so I don’t recommend using this card outside the US. If you’re looking for a great card with no foreign transaction fees, consider the Chase Sapphire Preferred® Card or Chase Sapphire Reserve® Card.
How To Maximize Chase Freedom Card
The Chase Freedom is marketed as offering cash back, and you’re earning anywhere from 1% cash back on everyday purchases (which isn’t competitive) to earning 5% cash back in the rotating quarterly categories (which is great).
There is a trick that will get you even more value, though.
Turning Cash Back Into Ultimate Rewards Points
While the Freedom is a cash back card, the card earns points, and those points can be converted into cash back at a rate of one cent per point.
However, if you have the Freedom in conjunction with a card that earns Ultimate Rewards points, then suddenly you can pool your points, and those get the full power of Ultimate Rewards. These cards include the following:
- Chase Sapphire Preferred® Card (review)
- Chase Sapphire Reserve® Card (review)
- Ink Business Preferred® Credit Card (review)
Transferring points between cards is easy and can be done online. You can learn more about that process in this post.
Redeem Ultimate Rewards Points For 1.25 to 1.5 Cents Towards Travel
There are a couple of ways to redeem Ultimate Rewards points. The first is that you can redeem Ultimate Rewards points towards the cost of a travel purchase through the Chase Ultimate Rewards website:
- If you have the Chase Sapphire Preferred or Ink Business Preferred, points can be redeemed for 1.25 cents each towards a travel purchase
- If you have the Chase Sapphire Reserve, points can be redeemed for 1.5 cents each towards a travel purchase
That increases the value of your points by 25-50% right there.
Transfer Ultimate Rewards Points To Airline Partners
Personally, the way I like to redeem Ultimate Rewards points is to transfer them to airline and hotel partners, which include the following:
|Aer Lingus Aer Club||IHG Rewards Club|
|Air France/KLM Flying Blue||Marriott Bonvoy|
|British Airways Executive Club||World Of Hyatt|
|Southwest Airlines Rapid Rewards|
|Virgin Atlantic Flying Club|
This can be the best way to redeem points towards premium travel experiences. If you want to redeem for first or business class travel or stay at luxury hotels, this option is for you.
Freedom Card Benefits
For a no annual fee card, the Chase Freedom offers a pretty good welcome bonus, and the 5x points categories can be hugely valuable (since I value Ultimate Rewards points at 1.7 cents each, I view that as being the equivalent of 8.5% back in those categories). There are some other perks to be aware of:
Extended Warranty Protection
You can extend the time period of U.S. manufacturer’s warranty by an additional year, on eligible warranties of three years or less.
You’re covered for new purchases for 120 days against damage or theft of up to $500 per claim and $50,000 per account.
With Chase Credit Journey you get unlimited access to your credit score and more. This is free for Chase customers.
One of the great features of Chase cards is access to Chase Offers, which provides savings on purchases with all kinds of retailers. The program wasn’t launched that long ago, but has already saved me a significant amount of money.
The Freedom features contactless pay technology. This means you can pay using your card without even swiping it whenever you see the contactless pay symbol.
DoorDash DashPass Membership
For having the Freedom Card you can receive a complimentary three month DashPass, which is DoorDash’s delivery service. This provides unlimited deliveries with a $0 delivery fee on orders of $12 or more. After that, you’ll receive 50% off DashPass for the next nine months.
You need to activate this perk by December 31, 2021.
Is The Freedom Card Worth It?
While I have the Freedom Card, this isn’t my go-to card for everyday spending. In my opinion, it could absolutely make sense to get this card, but only as part of a larger credit card strategy. This shouldn’t be your credit card for everyday spending.
Here are some things to consider regarding the Freedom Card:
Tip: Complement The Freedom With A Sapphire Card
I can’t emphasize enough that if you’re going to get the Chase Freedom, do so in conjunction with either the Chase Sapphire Preferred, Chase Sapphire Reserve, or Ink Business Preferred.
Any of those cards will increase the value of the points you’re earning significantly.
Quick Comparison: Freedom Vs. Freedom Unlimited
- The Freedom Unlimited offers 1.5x points on all purchases, so is great for everyday spending
- The Freedom offers 5x points in rotating quarterly categories on up to $1,500 of spending per quarter, so it’s great if you spend money in those categories, but otherwise isn’t that useful
While I have both cards, I think the Freedom Unlimited is the more well-rounded card, given that it offers 1.5x points in all categories.
Why The Freedom Card Is Getting Less Valuable
While I think the Freedom Card is well worth having, I also think it’s worth acknowledging that in some ways the card is becoming less valuable over time. That’s not because the card as such is getting worse, but rather because other cards are getting better.
We’ve seen the value proposition of spending on many cards improve greatly over the past few years, to the point that the incremental points you earn with the Freedom may not be as great as it used to be.
While people used to only earn an average of maybe one point per dollar spent, nowadays a lot of people are earning an average of three (or so) points per dollar spent. As a result, the incremental value of earning 5x points with the Freedom has decreased somewhat.
Best Cash Back Card Alternative
I know a lot of people use the Freedom Card as their go-to card for everyday spending, thinking that it’s a good cash back card.
If you’re looking for a cash back card with no annual fee, I’d recommend the Citi® Double Cash Card (review). The card has no annual fee and offers 1% cash back when you make a purchase, and 1% cash back after you pay for that purchase. Most people could come out ahead using this compared to the Freedom.
This card even offers a lot of flexibility, as the cash rewards earned on this card can be converted into Citi ThankYou points at a ratio of one cent per point.
Freedom Card Summary
I love Chase Ultimate Rewards, and the Freedom Card is a great add-on to that card portfolio. I have the Freedom Card, and love it for the ability to maximize 5x points in rotating quarterly categories.
Personally, I wouldn’t use this as my go-to card for everyday spending, though. So absolutely get the Freedom in conjunction with the Chase Sapphire Preferred or Chase Sapphire Reserve, but otherwise, if you’re looking to earn rewards on your everyday spending, consider something like the Chase Freedom Unlimited or Citi Double Cash instead.