The Chase Freedom Unlimited is a great rewards card for certain kinds of users – but who can get the most out of the offer?
The Chase Freedom Unlimited® was refreshed with some new bonus categories in 2020, and each one of them makes it easier than ever to rack up more rewards on your spending. In addition to the flat 1.5% cash back you earn on everyday purchases, cardholders now earn 5% back on travel purchases through Chase Ultimate Rewards and 3% back on dining and drugstore purchases (and don’t forget the 5% back on Lyft purchases through Mar. 31, 2022, and 5% back on grocery store purchases, not including Target® or Walmart®, on up to $12,000 spent in the first year). Remember, these rewards are given out on top of the $200 cash bonus you earn when you sign up and spend $500 within three months of account opening.
But is the Chase Freedom Unlimited the best card for you in the long run? Its flat cash back rate is competitive for users who don’t want to keep up with rotating bonus categories, but it might not always earn the most in rewards.
There are a few kinds of users we think can get the most value out of this card. Read on to see if it makes sense for you.
Ultimate Rewards cardholders
If you currently own a credit card that earns Chase Ultimate Rewards points and you want to maximize your rewards haul, the Chase Freedom Unlimited is a great card to add to your rotation. Not only does it have a competitive flat rate of cash back for regular purchases that makes it a great pair to any card with bonus categories, but transferring points between Chase credit cards is simple – and can potentially increase your point value.
For example, imagine you’re already a Chase Sapphire Reserve card owner. The Reserve earns 3X points on all travel and restaurant purchases (excluding those covered by the $300 annual travel credit). Plus, points redeemed for travel through the Chase Ultimate Rewards portal are worth 50% more.
By combining the bonus category earnings on the Chase Sapphire Reserve with the better general purchase rate on the Chase Freedom Unlimited, you can rack up Ultimate Rewards points faster. You could also use the Chase Freedom Unlimited to earn more points on drugstore purchases and on any travel you want to book directly with Chase.
Then, you can transfer all the rewards you earn to the Reserve card to get a higher point value out of them. We estimate the cards’ combined rewards rate at about 1.83 points per dollar based on average spending in these categories (as determined by the Bureau of Labor Statistics).
Potential yearly rewards value: Chase Freedom Unlimited + Chase Sapphire Reserve
|$15,900 annual spend x 1.83 points per dollar = 29,097|
|29,097 points x 1.5 cent point value = $436.46 (when redeemed for travel through Ultimate Rewards)|
|$436.46 – $550 annual fee (Sapphire Reserve) + $300 travel credit = $186.46|
Since the Chase Freedom Unlimited has no annual fee, it is a no-brainer to add to your Chase Ultimate Rewards collection.
Cardholders seeking simplicity
The Chase Freedom Unlimited card can also be a great starter credit card for users who want a simple cash back card for regular purchases. For those who don’t want to focus on weighing spending to a particular bonus category – or even enrolling in rotating categories each quarter – it is a top-tier flat-rate card thanks to a generous introductory offer and flexible redemption options.
Additionally, this card’s flat 1.5% back rate on non-bonus spending is better than what most cash back credit cards offer.
Consumers who spend at lot at drugstores
The Chase Freedom Unlimited offers 3% back at drugstores, which is almost unheard of among cash back credit cards with no annual fee. If you happen to spend a lot of money on prescription drugs or medical equipment you can purchase at stores like Walgreens or CVS, you could end up significantly ahead if you pay with this card and never carry a balance.
If you spent $1,000 per month ($12,000 per year) on prescription drugs and medical equipment, for example, the Chase Freedom Unlimited would help you earn $360 in rewards per year in this category alone.
People who want 0% APR on purchases
When you sign up for the Chase Freedom Unlimited, you are automatically eligible for a 0% introductory APR offer on purchases for 15 months, followed by a variable APR of 14.99% to 23.74%.
This introductory rate can make it easier to use your card for a large purchase and pay it down over time. In fact, consumers who pay off their purchases in full before the introductory offer ends get the benefit of a short-term, interest-free loan.
Rewards card jugglers
Even if you don’t have another Chase Ultimate rewards card, the Chase Freedom Unlimited makes a great addition to the wallet of any rewards card juggler. With a high flat rate of cash back, you can pair the card with another rewards credit card that offers bonus categories where you do a lot of spending; this boosts your overall rewards rate.
For example, you could combine the Chase Freedom Unlimited with the Capital One® Savor® Cash Rewards Credit Card to earn a top-tier rate on dining and entertainment while still earning competitive rewards on everyday spending.
Once again, this is a card pairing that could yield an exceptional amount of rewards within a year. Obviously, you would use each respective card in the bonus categories that yield the best results, then you would use the Chase Freedom Unlimited for all non-bonus spending so you would net a minimum of 1.5% cash back.
Potential yearly rewards value: Chase Freedom Unlimited + Capital One Savor
|$15,900 spend x 2.21% cash back = $351.39|
|$351.39 – $95 annual fee (Savor after first year) = $256.39|
Our figures show you might earn an average of 2.21% back with this combination of cards. If you were to spend $15,900 on your credit card each year, this would leave you with $351.39 in rewards after 12 months or $256.39 in rewards after accounting for the annual fee.
The Chase Freedom Unlimited is a great card for many types of users. It has a simple rewards structure that’s easy to understand, doesn’t come with an annual fee and makes a great addition to the wallet of any rewards card juggler. Plus, the welcome bonus makes it easy to rack up plenty of cash back in the first year to get you started.
If you’re ready to apply for the Chase Freedom Unlimited, you might want to at least compare a few other cash back credit cards first. You may find the Chase Freedom Unlimited is the best credit card for all your spending, but you may also find that pairing it with other rewards cards would leave you better off.
*All information about the Capital One Savor Cash Rewards Credit Card has been collected independently by CreditCards.com and has not been reviewed by the issuer. Capital One Savor Credit Card is no longer available through CreditCards.com.