Chase has shaken things up this morning with an unexpected move: on September 15th, they are introducing a brand new card called the Chase Freedom Flex and they are also seriously enhancing benefits on the Chase Freedom Unlimited. Given the enhancements on these cards – both will offer 3x dining and 3x drugstores – I speculate that we’ll also see some type of enhancements on the Chase Sapphire Reserve and Chase Sapphire Preferred in the coming weeks to keep those cards relevant.
New Chase Freedom Flex
Chase announced today that beginning on September 15th, they will be offering a new card called the Chase Freedom Flex. Here will be key details:
- Welcome bonus: $200 back (20K Ultimate Rewards points) after spending $500 in the first 3 months
- Fixed bonus categories: 5x travel booked through Chase Ultimate Rewards ⚬ 3x dining ⚬ 3x drugstores
- Rotating bonus categories: 5x on up to $1500 per quarter in rotating categories
- First year grocery bonus: 5x at grocery stores (excluding Target and Walmart) on up to $12K in purchases in the first year
- No annual fee
Note: According to CNN Underscored, it isn’t yet confirmed that points from the Chase Freedom Flex will be combinable with points from other Chase Ultimate Rewards card, but we expect they will be. Chase confirmed to CNN Underscored that points will be combinable with other Ultimate Rewards cards.
Like the current Chase Freedom card, the Chase Freedom Flex will offer rotating 5x categories on up to $1500 in spend each quarter. However, the card will additionally offer 3x dining & 3x drugstores and 1x everywhere else.
Interestingly, this card will be a World Mastercard, making it one of the very few Mastercards offered by Chase. With that come some nice benefits:
- Cell phone protection: Up to $800 per claim and $1K per year against theft or damage with a $50 deductible when you pay your monthly bill with the card (max of 2 claims per year)
- Lyft credits: Get a $10 credit for every 5 Lyft rides you take in a calendar month
- Boxed Rewards: 5% back in Boxed rewards for future purchases
- Free Shoprunner Shipping
- Fandango points: Double VIP+ points for movie tickets purchased via the Fandango app or at Fandango.com
All of that adds up to a pretty compelling package in my opinion. It’s kind of surprising to see this announcement come on the heels of an increased welcome bonus on the current Freedom (Visa) card. Folks who have recently opened that card for the 5x first year grocery bonus come out losers here since they missed the chance to also earn 3x dining and drugstores long-term. It’s kind of surprising that Chase would increase the bonus on that card only to replace the card so fast. Note that while I didn’t see this in the announcement, I have heard that Chase will stop accepting applications on the current Freedom card on September 15th. CNN Underscored says that this is not true. We’ll see.
While Chase has historically been good about allowing product changes within the same product family, we don’t yet know if that will also be the case when wishing to change from a Visa card (all of the other current Ultimate Rewards cards are Visas) to this new Mastercard. I expect we’ll still be able to product change — so those who recently opened a Freedom card will likely be able to change to a Freedom Flex down the road — but we won’t know for sure for a couple more weeks at least. Update: Chase has confirmed that current Freedom cardholders (and therefore presumably those with other consumer Ultimate Rewards cards) will be able to call in and convert to the new Freedom Flex after the card launches in a couple of weeks.
Enhancements to the Chase Freedom Unlimited
The new Freedom Flex isn’t the only news of the morning: Chase is also adding 5x travel booked through Chase Ultimate Rewards, 3x dining and 3x drugstores to the Chase Freedom Unlimited. That change also begins on September 15th, including for current cardholders. That’s an awesome deal for those with a Freedom Unlimited. The card already earns a respectable 1.5x everywhere and now adds two really nice 3x categories and 5x travel booked through Ultimate Rewards.
The Freedom Unlimited will continue to be a Visa, so no Mastercard benefits like cell phone protection and Lyft credits will apply.
Enhancements coming to the Chase Sapphire Preferred and Chase Sapphire Reserve?
When I saw this announcement, my first thoughts went to the Chase Sapphire Preferred and Reserve: do the Freedom cards make them almost totally irrelevant now?
Giving that the Freedom Unlimited and Freedom Flex will both offer 3x dining and 5x on travel booked through Chase Ultimate Rewards with no annual fee, it would look to be pretty hard to justify the Sapphire Reserve’s $550 annual fee. Paradoxically, the Sapphire Preferred is almost harder to justify at $95 for bonus categories that won’t add up to much comparatively.
Sure, the Sapphire Reserve will maintain the ability to use points at a value of 1.5c toward travel booked through Chase and likely toward other types of purchases with the Pay Yourself Back feature. And the Sapphire Preferred and Reserve offer bonuses on all travel, not just travel booked through Chase. The fact that each of those Sapphire cards carry no foreign transaction fees will make a difference for those who spend a lot of money abroad. Further, you will still need a premium Chase card to transfer to travel partners, so having one Sapphire Preferred, Sapphire Reserve, or Chase Ink Business Preferred in your household will still be a necessity for those looking to transfer.
But I have to think that Chase will need to do something to enhance the Sapphire Preferred and Reserve to maintain interest in those cards among the masses. Greg thinks that at the minimum those cards are likely to match the 5x on travel booked through the Chase Ultimate Rewards portal. I don’t disagree and further wouldn’t be surprised to see 5x added to the travel bonus category on those cards to make for 7x or 8x on travel booked through Chase Ultimate Rewards — but note that this is total speculation on my part. I definitely think those cards will need to add something and I think that if Chase is feeling generous enough to add 3x dining and 3x drugstores on the no-fee cards, we might be in for a good surprise on the premium / ultra-premium front. I certainly hope so.
Bottom line
I am surprised to see a new card launched, though I think that it makes sense from the standpoint of branding and clarity for consumers: we frequently get questions from readers wondering if they are eligible to have or get a welcome bonus on both the Freedom and Freedom Unlimited cards at least in part because of the almost-identical names. Having two different card names — the Freedom Flex and Freedom Unlimited should help obviate some of that confusion and make it clearer to consumers that these are separate products. (Update: CNN Underscored tells us that Chase does not intend to end applications for the Freedom card after all, so this may not help eliminate confusion at all but rather add to it. Weird.)
I further think it is exciting to see 3x dining and 3x drugstores added on cards with no annual fee. Both are generous return that will no doubt draw the interest of many points enthusiasts. Given the generosity here, I think it is reasonable to expect something to be added to the premium Chase cards in the coming weeks or months, though we have no news on that yet.
Overall, I see all positives here and look forward to seeing what else Chase has in store.
H/T: Award Wallet
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[…] that Chase is serving up awesome 3X and 5X categories for their fee-free Freedom cards, the Sapphire Preferred card is looking old and tired with its 2X travel and dining. Even the […]
[…] Chase recently announced an overhaul of their fee-free consumer Ultimate Rewards cards. The Chase Freedom Visa card is being replaced with the new Freedom Flex Mastercard, but with the same 5X quarterly rotating categories as before. And both the Freedom Flex and the Freedom Unlimited card gain 3X rewards for drugstore and dining purchases and 5X rewards for travel booked through Chase. Since both cards earn Ultimate Rewards points, these changes make the Ultimate Rewards program more compelling than ever before. […]
[…] week ago, Chase knocked my socks off with the news that they were revamping their Freedom cards. The Freedom Visa card (with its 5% rotating categories) will be replaced with the new Freedom […]
[…] Chase’s new Freedom Flex card is coming very soon (September 14th or 15th). This new fee-free card will offer the same Ultimate Rewards points and rotating 5X categories as the current Freedom card, but with additional uncapped bonus categories: 3X dining and drugstores, and 5X travel booked through Chase. In almost every way, this new Mastercard is superior to what I’ll now call the “Freedom Visa.” That said, we’ve been told that after September 14th, the Freedom Visa will no longer be available to new applicants. Current cardholders, though, will be able to keep their cards longer indefinitely. Should you get one now before it’s too late? […]
If freedom card holder does the product change to Freedom Flex, does one qualify for first year grocery bonus (5x on 12kk) or this is only available for new applicants.
For several years now the Freedom card has had groceries as the Q2 bonus category. Do you think that will change in 2021, given that people who have signed up recently will already be getting 5x on groceries? Would they get an extra $1500 of 5x earnings? Or would that quarter be useless for them?
It’s nice, but still not going to convince me to switch back to Chase. The biggest problem Chase has vs. AMEX is that AMEX has so many opportunities for you to earn big bonus points without having to sign up for a new card. Once you blow your UR load and are over 5/24, you need to generate serious spend or MS to build up a sizable UR nest egg.
Chase transfer partners, with the exception of Hyatt, do nothing for me. And the two Hyatt redemptions I really like costs me 175,000 points each. Even with all the spend at 5x office stores thats $35,000 spend which is hard to generate if you don’t have an MS outlet where you live.
Meanwhile, AMEX continues to drop 100,000+ MRs into my wife and my’s laps every year with minimal effort, no MS required.
Two questions: first – how does this effect 5/24 specifically for the product change part? Does a product change in this case restart your 5/24 clock? Second- if it’s still available to apply for now and someone doesn’t have it would you recommend people go apply for the card since it’s being sun set, so get it while you still can?
A product change has no influence on 5/24. It’s as if you kept the same account. It won’t add anything to your count and if that account is part of your five it’ll fall off as originally scheduled. Again, no change to anything there.
There is certainly something to be said for the thought of applying for the Freedom (non-Flex version) now if Chase does intend to sunset it. Chase says they aren’t getting rid of it right now. See above for speculation as to why that may be the case.
I think I have to see how things shake out when the Flex is introduced and whether or not people who recently opened Freedom cards are indeed able to change to the Flex. If they are, it certainly might make sense to apply for the old Freedom and then PC to the Flex down the road, especially if you have a CFU in your household to get the 3x categories and 5x travel through Chase UR.
I’m going to hold off and think about it before saying I recommend that path.
Hmmm. If the flex is a different product I wonder if the rotating categories will be the same as the Freddom.
I don’t know for sure. There is certainly the argument that they might be different because they are different products and payment networks.
But if you asked me to bet, I’d bet they end up being the same.
Julian from CNN Underscored speculated in Twitter conversation (just speculation here) that perhaps the deal that Chase has with Visa somehow blocks them from eliminating the Freedom card yet. That makes sense to me — I’d think there must be an end date to their deal and maybe it isn’t up yet and so they maybe Chase just can’t yet get rid of the Freedom — but maybe they intend to do so down the road. If that’s correct (and again, it’s a guess that sounds good to me but just a guess), then my bet is that they don’t want to create extra confusion and thus will offer the same rotating categories.
On the other hand, if they actually intend to have a Freedom, Freedom Flex, and Freedom Unlimited all on offer (which makes less than zero sense to me given the way it would confuse any average consumer), then maybe the rotating categories will be different.
Guess we’ll find out soon!
So would it make sense for me to PC from CSR to Freedom then apply for FFlex and CSR again in the future? If they eliminate Freedom would I be out a card because apparently they won’t let me have two FFlex.
Nick, I actually googled this yesterday and Visa/Chase initially signed a 10-year deal in 2013. Chase had issued Visa Freedoms before that but all UR cards from then on were exclusively Visas (I didn’t have CSP then but I think that was always a Visa). Obviously, all the co-branded cards other than IHG (for whatever reason) became or were later launched as Visas too.
I thought I remembered reading Gary Leff reported last year that Visa announced an extension with Chase (during an earnings call?) but couldn’t find any article confirming it.
I did see an article from this February that Visa was a party to the multi-year (Washington Post said 10-year) extension between Chase and United. A Visa executive was quoted in the press release.
But maybe Chase is going to phase out their UR cards being Visa after 2023 (or sooner) if they have the right to do so and MasterCard is offering them an even better long-term deal on network access/swipe fees.
For many people, it may only matter if you really want to buy Olympics or FIFA World Cup tickets since Visa currently has exclusive global sponsorship of both events.
If you product change to the flex, I know you don’t get the welcome bonus. But do you get the first year grocery bonus? Thanks!
No. That’s part of the new cardmember bonus. Got to apply new to get the first year grocery bonus on any of them.
Why the MasterCard? Doesn’t Chase have some super sweet deal on processing fees with Visa?
Apparently it isn’t as sweet as whatever Mastercard offered, right?
I’d be curious to hear what the best strategy is (if there is one) for people with 2+ Freedom cards already.
If you’re under 5/24, the Flex may still be worth going after for the first year grocery and the welcome bonus. Then see if the rotating categories are the same or not and go from there.
I was debating about keeping the CFU, as it gets almost no use – this just caused it to gain a spot in my everyday wallet. I do question what is in store for the CSR? I saw somewhere a question about possible limitations on point transfers … any thoughts?
Chase says you’ll still be able to combine points. I don’t expect they’d have said that if they intend to change it.
Curious about the community’s thoughts (and yours, Nick) re: MS’ing on CFU at drugstores. $500 Vanillas have a $5.95 charge.
yeah but how do you liquidate vanillas? at least at grocery store can get metabank visas which are super easy at walmart
Yeah, can’t liquidate at WM, but I thought grocery store MO’s were an option.
The problem with WMT is the low velocity limits. Easier to liquidate more volume via grocery stores.
so can i apply for the freedom now to get the SUB and then in a few months apply for the freedom flex to get a SUB for that card too?
Theoretically, yes. Chase has been more difficult on approvals in the current environment, but the Freedom cards are typically the easiest to get.