This week I learned two bits of information that have me excited about the Chase Freedom card. I haven’t got a card because Chase has some valuable sign up bonuses. I don’t want to burn a big sign up earning opportunity with a Chase card application for this card.
How valuable are Chase sign up bonuses?
Here’s what I’ve earned this year:
- Continental – 50,000 miles (now best offer is 40,000)
- Southwest – two free flight vouchers (now best offer is 1 free flight or 25,000 miles)
- British Airways – 100,000 miles (now best offer is 50,000)
- Southwest – 50,000 Southwest miles (now best offer is 1 free flight or 25,000 miles)
- Southwest Business – 50,000 Southwest miles (now best offer is 1 free flight or 25,000 miles)
The good news is that now you don’t have to burn a Chase application to get the Chase Freedom. I’ll talk about that in a minute.
But first, let me show you why I’m excited about this card.
Chase Freedom 2012 Bonus Categories
Chase released the 5% bonus categories for 2012 and the list looks pretty interesting:
| Dates | Bonus Categories |
| January to March | Gas Stations and Amazon.com |
| April to June | Grocery Stores and Movie Theaters |
| July – September | Gas Stations and Restaurants |
| October – December | Hotels, Airlines, Best Buy, Kohl’s |
What’s really cool about the Chase Freedom card is that there is a way to transfer these points to airlines like United or British Airways, or even to hotels like Hyatt.
In order to transfer those points, you’ll need to have a Chase Sapphire Preferred. I’ll show you how to do that in a minute.
Thus, the 5% bonus categories will yield 5 points/miles per dollar spent.
Chase Freedom Can Be Upgraded to the Chase Sapphire Preferred
This week, the Frugal Travel Guy confirmed that you can upgrade your Freedom card to a Chase Sapphire Preferred. Also, you can downgrade a Chase Sapphire Preferred to a Chase Freedom.
That means you can either accumulate these points, and then eventually get a Sapphire Preferred (and get a 50,000 point sign up bonus), or you can even upgrade your Freedom card to a Sapphire Preferred. You’ll pay the annual fee ($95), but you won’t get hit with another credit inquiry.
I think this is very valuable for low spenders who can’t justify the annual fee of the Chase Sapphire Preferred, but who want to be able to get in on the opportunity to transfer points to flyer mileage programs.
Here’s what my wife and I plan to do.
She has the Chase Sapphire Preferred. Of course, that is the better card to start with because the sign up bonus is bigger (50,000 compared to Freedom’s 30,000). Also, the Sapphire Preferred waives the annual fee for the first year. If you want to use your own strategy and just sign up for the Freedom card initially, that’s fine too.
When the time is right (for sure before a year is up and we have to pay for the annual fee), call and downgrade the card to a Chase Freedom.
Enjoy the opportunity to earn 5 miles per dollar on the bonus categories listed above.
Rack up a lot of miles.
When it comes time to transfer the points, call and ask to upgrade back to a Chase Sapphire Preferred (be prepared to pay the $95 annual fee).
Honestly, I think we could earn more points with these bonus categories than we could with the Sapphire Preferred 2 points per dollar on dining and travel.
Ultimate Reward Bonuses + Freedom Bonus Categories = Huge Earning Opportunities
Right now, the Ultimate Rewards shopping portal is offering lots of bonuses (like 10x per dollar spent). If that retailer happens to also be a bonus category, one you can turn that 10x into 15x.
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Related Articles:
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- Chase Sapphire Preferred 100,000 Bonus Point Offer (Targeted)
- 50,000 Points Sign Up Bonus | Chase Ink Bold with Ultimate Rewards
- Chase Sapphire Preferred Vs. Citi ThankYou Premier Card
About Craig Ford
After the $95 annual fee, what sort of profit margin can I expect if I make transfers of $800 to $1,200? I think this looks like it could work pretty well for me if I play it right.
Lucy,
The Freedom card does not have an annual fee. The Chase Sapphire Preferred card does, but it is waived for the first year. That means if you cancel it or downgrade it to a Freedom after 11 months you don’t have to pay the annual fee.
Hi
I’ve always had the chase freedom, (thus no signup bonus) and I use if for business expenses (15,000 gallons of heating oil for my apartments ….perhaps 100k total this year) — is there a huge benefit to doing the sapphire upgrade, and transferring all these points, vs. simply getting “cash back” and using it directly for travel? (forgive me if this is too “newbie” — I’m very green to the whole travel hacking idea. I’ve been focusing on simple cash back for a long time so this is brand new)
Ken,
There would be two primary benefits.
1. When miles are more valuable than points. This is almost always true for upper class travel (like Business Class). A $5,000 business class ticket to Europe would require 100,000 United miles (100,000 Ultimate Rewards point transfer to 100,000 United miles). However if you were going to buy a $5,000 ticket with cash back point you’d need 500,000.
2. The second advantage is earning. The Chase Sapphire Preferred gives you 2 points per dollar on travel expenses and dining out. That’s not a big deal, but a nice benefit.
You’ll need to look into your desired travel destinations to see if the Chase Sapphire Preferred may add value to the points you’re already earning.
Let me know if you have any other questions.