In the March 2015 post “Chasing Ultimate Rewards,” I detailed plans to earn approximately 210,000 Ultimate Rewards points per year without paying credit card annual fees. Since then, things have changed. Chase’s new, tougher, application approval process has become well documented. According to many reports, Chase no longer approves applications for cards that earn Ultimate Rewards points if the applicant has applied for many other cards recently. For details, please see Doctor of Credit’s post: Chase Credit Card Churning – Living with the New Reality. Chuck, at Doctor of Credit, summarizes his post as follows:
- 5 or more new cards can trigger denial (occasionally even less can be problematic)
- Even non-Chase cards count to this number
- AU cards do count toward the 5-card limit, though you may be able to convince a rep not to count them
- Reps seem to have the power to approve you with more than five, but that usually doesn’t happen
- Shifting credit lines doesn’t help
- Co-branded cards are mostly unaffected
- Business cards (INK) may be slightly easier to get than personal cards
- Business cards possibly won’t count toward the 5-card max
To be clear, the above summary is just a rough guideline. Chase doesn’t seem to apply hard and fast rules across the board. I’ve heard from plenty of readers who have succeeded in signing up for new Ink or Sapphire Preferred cards recently despite having far more than 5 new cards on their credit reports. Still, I do believe that the trend is towards tougher application reviews and more denials.
So, why does this cause me to rethink my strategy? Let’s review the plan I detailed in my earlier post (see the original post for full details):
- ~50K per year via Ink 5X category bonuses: Spend at least $10,000 per year with Ink card within 5X categories: Office supplies, telecom, cable.
- ~60K per year via Freedom 5X category bonuses: Make use of Chase Freedom’s rotating 5X category bonuses. I assumed that my wife and I would each get two Freedom cards and that we would earn half the possible points from quarterly bonus categories. Max possible per card at 5X = 30,000 points (due to $1500 per quarter limit). With 4 cards, max possible = 120,000 points.
- ~100K per year via signup bonuses: Sign up for Chase Sapphire Preferred and Ink Plus every year. Alternate signups between my wife and I, and schedule so that new signups always takes place at least two years after the previous bonus was earned. By alternating premium cards, we would always have the ability to transfer to loyalty program partners and we would never have to pay an annual fee as long as the first year fee is waived.
Due to Chase being much more strict with new applications than expected, I feel a need to revise my strategy with respect to that last bullet. I no longer believe that its a good idea to alternate premium card signups over and over.
Experience so far
Shortly after writing the “Chasing Ultimate Rewards” post, I tried to put the plans in motion. I successfully downgraded my wife’s Sapphire Preferred card to a Chase Freedom card so that she now has two. This gives her twice as much 5X buying power. Of course, I added myself as an authorized user to each of her cards so that I could help with that 5X spend.
Next, I tried to signup for a new Sapphire Preferred card. I had earned the bonus on my previous Sapphire Preferred card more than three years ago, so I was well within Chase’s rules for qualifying for a new bonus. Specifically, Chase’s rules currently state that two years must have elapsed from the prior bonus:
This new cardmember bonus offer is not available to either (i) current cardmembers of this consumer credit card, or (ii) previous cardmembers of this consumer credit card who received a new cardmember bonus for this consumer credit card within the last 24 months.
I had appied for the Sapphire Preferred card on the same day that I had already applied for the Chase Amtrak card (which is no longer available). The Amtrak card was instantly approved. The Sapphire Preferred application was pending, but when I called Chase’s reconsideration line I learned that the application was denied due to too many recent applications. I asked about moving credit from another card or even cancelling another Chase card, but was told no.
I called a second time, but was then told a slightly different story. This time, the rep did mention having many recent applications, but she also said that I couldn’t get more than one application approved from Chase per month. What? That was new to me. I’ve successfully signed up for multiple Chase cards in one day in the past and I know many others have done so as well. In fact, I’ve heard from quite a few people who have done so recently. So, I asked if this was a new rule. The agent claimed that they apply different rules to different accounts and that my account is limited to one new card per month. She said that I could try again next month. She even offered to approve me for the Sapphire Preferred card if I was willing to give up the new Amtrak card! That was a tough decision, but I decided to keep the Amtrak card for its ability to unlock transfers to Choice Privileges at a fantastic 1 to 3 ratio.
I’m still a big fan of Chase’s Ultimate Rewards program. I use my Ultimate Rewards points more often than any other points currency. I regularly transfer points to Hyatt, United, Southwest, and Amtrak. So, its important to me to continue to earn points each year.
I do plan to eventually try again for a new Sapphire Preferred card, but that will most likely be the last one I ever apply for (well… maybe my wife will try again sometime in the future too). Anyway, the point is that I won’t count on doing so repeatedly. My end goal is to keep just one premium Ultimate Rewards card between my wife and I. That way, we’ll have just one $95 annual fee and we’ll retain the ability to transfer points to loyalty programs. The trick will be to move points, as needed, from no fee Freedom or Ink Cash cards to our single premium card so that the points can then be transferred to loyalty programs such as Hyatt, Amtrak, etc. (As of 12/8/15 Ultimate Rewards can no longer be transferred to Amtrak.)
Which premium card? As a general rule, I think that the best combination of Ultimate Rewards cards is:
- Chase Freedom: no annual fee
- Chase Ink Cash: no annual fee
- Chase Sapphire Preferred: $95 annual fee
With this trio of cards, you get access to all Ultimate Rewards category bonuses for $95 per year:
- 5X rotating categories (Freedom)
- 5X office supplies, cellular, landline, and cable; 2X gas and dining (Ink Cash)
- 2X travel and dining (Sapphire Preferred)
You might, though, have another card that offers equal or better travel and dining bonuses. For example, the Citi Prestige card offers 3X for travel (hotels, airlines, and travel agencies) and 2X for dining and entertainment. Even better, the Citi ThankYou Premier card offers 3X for all travel and gas and 2X for dining and entertainment.
I have the Citi Prestige card and will probably signup my wife soon for the Premier card. So, I don’t really care whether we keep a Sapphire Preferred card in our arsenal. Instead, I’ll probably simply keep and pay the annual fee for my current Ink Plus card.
Without repeated signup bonuses in the plan, my projected earnings drop from 210,000 per year to 110,000 per year:
- ~50K per year via Ink 5X category bonuses
- ~60K per year via Freedom 5X category bonuses
That might be enough for me. Its hard to say. Fortunately, there’s room to maneuver. With the Ink Plus, its possible to earn up to 250,000 points per year at 5X. And, if I succeed in getting a second Freedom card for myself (my wife already has two), we would have the potential to earn up to 120,000 points per year at 5X with our four Freedom cards. In total, we could potentially earn up to 370,000 points per year. That’s without counting points earned through the Shop with Chase portal, or from using our cards for 1X or 2X spend.
My plan, though, is to stick with the conservative earning rates I laid out previously, and see how it goes. Currently, my wife and I have well over 400,000 points. As long as our earning rate is enough to keep our balance at, or above, 250,000, I’ll be happy with that. If we drop below 250K, I’ll work more aggressively on rebuilding our points balance.
Last updated on December 17th, 2015