The past several months have been, shall we say, odd. As the country has adjusted to life in the age of COVID-19, people have embraced new lifestyles, hobbies and spending habits. Banks, likewise, have been adjusting to their customers' needs.
Chase has led the pack when it comes to banks responding to the new "normal" with updated credit card reward structures and features for their credit card customers. Today, Chase continued that trend by announcing that the popular Chase Freedom Unlimited® card is getting a signup bonus and rewards-earning update for new cardholders.
What is the Freedom Unlimited® signup bonus?
New cardholders can earn $200 cash back (20,000 Ultimate Rewards points) after spending just $500 in the first three months of card membership. That means that the bonus alone is worth 40% of the spend to earn it. Additionally, cardholders will accumulate regular rewards on the spending (at least 1.5% cash back, or 1.5 points, per $1 spent) to reach the bonus threshold. And the with a new rewards tier being rolled out, that regular earning could be significantly higher (more on that below).
Also, while not a signup bonus, new cardholders may also appreciate the intro 0% APR on purchases for 15 months (then, 14.99 - 23.74% Variable). This could particularly come in handy during these uncertain COVID-19 times, when you might need a little extra time to pay off a purchase or two.
What are the new Freedom Unlimited® rewards?
In addition to being eligible for the higher-than-normal signup bonus, new Chase Freedom Unlimited® cardholders will earn five points per $1 on grocery store purchases for one calendar year (up to $12,000 spent; Walmart and Target purchases are excluded). Eligible cardholders are those who applied July 24, 2020 or after.
"This year, we have seen significant shifts in our customers’ spending preferences," reads a statement from Chase. "Chase Freedom Unlimited® is committed to providing opportunities to earn cash back at places our cardmembers shop the most."
New cardholders will continue to earn unlimited 1.5% cash back on all their other purchases as well as on grocery store purchases after reaching the cap for the calendar year.
Is Chase Freedom Unlimited® worth it?
This card has been regularly named among the best cash-back credit cards since its launch several years ago. The addition of this new earning at grocery stores as well as an increased signup bonus for new cardholders only sweetens the deal.
Let's do some math related to the signup bonus using the new 5x points on grocery store purchases:
- $500 spent at grocery stores x 5 points per $1 = 2,500 points (redeemable for $25 cash back)
- Welcome bonus after spending $500 in three months = 20,000 points (redeemable for $200 cash back)
- Total points earned = 22,500 (redeemable for $225 cash back! and that's just in relation to the signup bonus without even considering the excellent ongoing earning opportunities beyond that initial bonus and spending.
So, for a no-annual-fee card that makes it possible for you to earn $225 cash back just as part of earning the signup bonus, we'd say yes, Freedom Unlimited® card can certainly be worth it.
How do you maximize your Chase Ultimate Rewards® points?
No one could blame you if "cash back" has a better ring to it than "travel points" right now, but don't overlook the value of hanging on to those points rather than redeeming right away for cash back as they are Chase Ultimate Rewards points after all, one of the most sought-after travel rewards currencies out there.
In fact, combining Freedom Unlimited® with another card or two that earns Chase Ultimate Rewards® points could have you realizing your travel rewards dreams rather quickly. Here's how that can work:
First, for the purposes of this illustration, remember that 1% cash back is the same as one Ultimate Rewards® point per $1 spent.
Combine Freedom Unlimited®, a card that earns 1.5% cash back (so 1.5 points) on every purchase and for new cardholders 5% cash back (five points) on grocery store purchases up to $12,000 spent in a calendar year, with the Chase Sapphire Preferred® Card (This card is not currently available on CardRatings), a card that earns two points per $1 spent on dining and travel. The very important part off combining these two cards is that you combine the points earned into a single bucket under the Sapphire Preferred card and with that card, all your points are worth 25% more when you redeem them for travel through the Ultimate Rewards portal. You can learn more about Ultimate Rewards points in our Guide to Chase Ultimate Rewards.
If you want to go for the Chase Trifecta, you'll want to add Chase Freedom® (This card is not currently available on CardRatings) to the mix. With Freedom, you earn 5% cash back on up to $1,500 spent in categories that rotate quarterly and 1% on all your other purchases. Here's what it looks like to maximize your points with these three cards:
- Chase Freedom Unlimited®: Use for grocery store purchases (5% back up to $12,000 spent in a calendar year) and all purchases that don't earn more with the other cards.
- Chase Freedom®: Use for the purchases in the 5% category each quarter. Take a look at the quarterly categories.
- Chase Sapphire Preferred®: Use for dining and travel purchases. Chase also rolled out bonus earning on this card at gas stations (3x points per $1 up to $1,500 spent) and 5x points on select streaming services through Sept. 30, 2020.
Lastly, if you really are dreaming of that next travel opportunity and you're willing to put some extra perks and features to good use, you can consider the Chase Sapphire Reserve® instead of Sapphire Preferred®.
With Sapphire Reserve®, you earn 3x points on travel and dining and enjoy other perks like airport lounge access, an annual travel credit and more. It does come with a $550 annual fee, but it's not hard to offset that with all the rewards earning and extra value features. Furthermore, your rewards are worth 50% more when you redeem them for travel under this card.
The information related to Sapphire Preferred® and Chase Freedom® has been collected by CardRatings and has not been reviewed or provided by the issuers of these cards.