In this post, I wanted to take a look at who should and shouldn’t consider picking up this card. This is especially relevant right now, as the card is offering an improved bonus for new cardmembers.
Chase Freedom Unlimited Basics
Here are the basic things to know about the Chase Freedom Unlimited:
- Annual fee: $0
- Return on spending: 1.5x points (or 1.5% cash back) per dollar spent
- Value of points: Each point can be redeemed for one cent, though in conjunction with another card can be worth more
- Foreign transaction fees: 3%
Freedom Unlimited’s Increased Welcome Bonus
The Chase Freedom Unlimited is offering an improved welcome bonus:
- Earn 20,000 points (or $200 cash back) after spending $500 on purchases within the first three months
- Earn 5x points (or 5% cash back) on groceries for the first 12 months, on up to $12,000 of spending
The part of this bonus that’s new is the 5x points on groceries for the first 12 months, which should prove especially valuable given how consumer spending has evolved.
Who Wouldn’t Benefit From Freedom Unlimited
On the most basic level, the Chase Freedom Unlimited is a cash back card, earning 1.5 cents back per dollar spent. While that’s decent, it’s not great, and you can definitely do better.
For example, the Citi® Double Cash Card also has no annual fee and offers 1% cash back on every purchase, and then an additional 1% cash back when you pay for those purchases. So that card offers a significantly better return. As of recently these rewards can even be converted into ThankYou points, but that’s neither here nor there for the purposes of this example.
Regardless of which path you choose, there’s no reason to earn 1.5% cash back when you could be earning 2% cash back on a variety of cards.
Who Would Benefit From Freedom Unlimited
What makes the Chase Freedom Unlimited so interesting is how much the value of the card can change based on what other card you have in conjunction with it. Having the right other card to go along with it improves the value proposition by at least 50%, making it an industry-leading card.
Ordinarily, if you have the Freedom Unlimited, points can be redeemed for a penny each, meaning that 20,000 points are worth $200 cash back. You get that same value no matter what you choose to redeem for, whether a statement credit, travel purchase, or gift card.
However, if you have the card in conjunction with one earning Ultimate Rewards points — the Chase Sapphire Preferred® Card (review), Chase Sapphire Reserve® Card (review), or Ink Business Preferred® Credit Card (review) — then you can convert the points earned on the Freedom Unlimited into Ultimate Rewards points at a 1:1 ratio. This can easily be done online for free, and it’s an instant process.
Have the Chase Sapphire Reserve® Card? Suddenly 15,000 points are worth $225 towards travel, rather than $150.
Through September 30, 2020, you can even redeem these points towards dining and grocery purchases at the higher rate, thanks to Chase’s new “Pay Yourself Back” feature.
I’d say that’s the minimum value you should get out of those points. You can then also transfer the points 1:1 to any of the following partners:
|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 is a way to get outsized value, especially for luxury vacations (if/when that’s something you’re able to do and are comfortable with). For example, you could transfer 30,000 points to World of Hyatt for a free night at the Park Hyatt Maldives.
Or you could transfer as little as 50,000 points to Virgin Atlantic Flying Club for a Delta business class ticket from the US to Europe.
You can find more about all the ways to redeem Ultimate Rewards points and why I value them so highly in my Ultimate Guide to Ultimate Rewards.
Have The Freedom Unlimited? It’s Not Too Late
If you’re someone who has been using the Chase Freedom Unlimited® as a cash back card for whatever amount of time without realizing you could get a lot more value, there’s good news.
If you pick up one of the cards that outright earns Ultimate Rewards points — the Sapphire Preferred, Sapphire Reserve, or Ink Preferred — you can transfer over all your points to that card, and benefit from the increased value.
That’s the case even if you earned all of those points before you applied for the new card. So don’t feel bad. You’ve actually been using the right card all along, you just didn’t know it. 😉
Downgrade To The Freedom Unlimited
There’s potentially another option for acquiring the Chase Freedom Unlimited®, beyond outright applying for the card.
In theory, you should be able to product change some other Chase personal cards, including the Sapphire Preferred or Sapphire Reserve to the Freedom Unlimited.
You’ll need to phone Chase to see what’s possible, but as a general rule of thumb as long as you’ve had a card for at least a year, you can product change it.
For example, having the combination of the Ink Business Preferred and Freedom Unlimited could make sense, as the former gives you access to Ultimate Rewards and has great bonus categories, while the latter offers 1.5x points per dollar spent.
Freedom Unlimited Summary
If you’re using the Chase Freedom Unlimited® independently as a cash back card, you could probably be doing better with another card. The card offers the equivalent of 1.5% back, when other cards offer 2% back.
At the moment it could still make sense even if you’re using it that way, though, given that you can earn 5% back on groceries for the first 12 months.
The good news is that if you’re using the Freedom Unlimited in conjunction with another card (especially the Sapphire Reserve), you’re doing things right. You’re using what I consider to be the single best card for non-bonused spending without any sort of caps on how many points you can earn per year.
You’re earning 1.5 Ultimate Rewards points per dollar spent, which can be redeemed for 1.5 cents each towards a travel purchase (for a return of 2.25% per dollar spent), or can be transferred to an Ultimate Rewards airline or hotel partner (where I think you can get even more value). At the moment you can even redeem at that rate towards groceries and dining.
And then there’s the icing on the cake, which is the 5x points on grocery store purchases for the first 12 months, on up to $12,000 of spending.