Updated January 16, 2018
Chase brings cardholder value in spades with its $0 annual-fee, cash-back credit card, Chase Freedom®. We appreciate Chase Freedom® for its money-savvy features, including a 0% intro APR offer and cardholders will undoubtedly welcome the low hurdle to qualify for the new cardholder bonus. Let’s dive deeper and uncover whether Chase Freedom® is a good fit for you.
- $150 new cardholder bonus
- 5% bonus cash-back categories
- $0 annual fee
- 0% intro APR
- Bonus categories require activation
- 1% base-rate cash-back
|Bonus Offer||$150 bonus after you spend $500 on purchases within three months of account opening|
Intro: 0%, 15 months
Reg: 16.24% - 24.99%, variable
|Balance Transfer APR||
Intro: 0%, 15 months
Reg: 16.24% - 24.99%, variable
- Earn a $150 Bonus after you spend $500 on purchases in your first 3 months from account opening
- Earn 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate
- Enjoy new 5% categories each quarter
- Unlimited 1% cash back on all other purchases - it's automatic
- 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 16.24-24.99%. Balance transfer fee is 5% of the amount transferred, $5 minimum
- No minimum to redeem for cash back
- Cash Back rewards do not expire as long as your account is open
- No annual fee
What we like about Chase Freedom®
- $150 new cardholder bonus – Qualifying new cardholders spending at least $500 on new purchases within the first three months from account opening can expect an extra $150 in their pockets. This is a competitive bonus for the spending hurdle.
- $25 authorized user bonus – Adding an authorized user within the first three months from account opening will net you a $25 bonus. Keep in mind that authorized users can legally charge purchases to your card, but only you have the legal obligation to pay the balance.
- Earn up to 5% bonus cash-back – Perhaps what stands out most for the Chase Freedom® card is the card’s 5% bonus cash back in rotating categories, which have included gas, restaurants, groceries, and wholesale clubs (yes, Costco, too!). It’s worth noting that the 5% bonus cash back is capped at $1,500 in combined spending per quarter (or $75 in quarterly bonus rewards) each quarter you activate. You’ll continue to collect 1% on all spending over and beyond the $1,500 limit, though.
- $0 annual fee – Generally, credit cards packed with valuable features tend to charge high annual fees. Chase Freedom® balances this relationship well by eliminating the annual fee, which makes it a solid credit card for people with modest spending habits not spending enough to justify an annual fee.
- 0% intro APR – Chase Freedom® a 0% intro APR for 15 months on purchases and balance transfers. The offer length outpaces many cash-back credit cards on the market and is a handy feature for cardholders wanting to pay off debt faster with balance transfer strategies of to defray the costs of a large purchase, while earning rewards.
What could be improved for Chase Freedom®
- Base rate
1% cash back – All purchases outside of bonus categories earn unlimited 1%
cash back. Note, this rate is in line with cards offering bonus cash back in rotating categories. More than anything, it highlights the need to match a high cash back rate with your biggest spending categories to earn the most rewards.
How to best use Chase Freedom®
- Cash-back cardholders will generally be better off paying balances by the due date each month to avoid interest charges. It’s a losing strategy to rack up debt for the sake of earning rewards at single-digit rates only to watch as they get eaten up by far higher double-digit interest charges.
- Spend at least $500 on purchases within the qualifying period to earn a $150 bonus. The clock starts ticking upon account opening, not when you receive and activate your card, so pay close attention.
- Transfer high-interest credit card debt to chip away at debt balances faster. We Fools always encourage smart use of debt, and transferring balances to a 0% intro APR card can help avoid costly interest charges. In fact, paying down a $5,000 balance over 12 months will cost a whopping $462 in interest charges at an 18% APR.
- Be sure to activate the quarterly 5% bonus cash-back categories to ensure you’re maxing out rewards. Missing the activation period will result in bonus category purchases earning the low 1% base rate.
- Consider placing bonus category purchases on the Chase Freedom® card and all other purchases on a card that earns a higher rate than 1% cash back (more on that below) to increase overall rewards..
Chase Freedom® and Chase Freedom Unlimited®As mentioned, Chase Freedom®’s base cash-back rate is relatively low. Overall cash back can be increased by using Chase Freedom® for bonus-category purchases and Chase Freedom Unlimited® for all other purchases, to earn 1.5% cash back, not a lower 1%.
Other than different cash-back rates, the two credit cards are practically the same in terms of their features, including sign-up bonuses, 0% intro APR offers, and $0 annual fees. If choosing one, the decision may ultimately come down to bonus category spending habits and your willingness to be more hands-on with your credit cards by activating bonus categories each quarter. Read our full Chase Freedom Unlimited® review to learn why we picked it as one of the best cash-back credit cards.