Should you get the Chase Freedom Visa before its too late?

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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?

I started writing this post with the expectation that I’d argue that you should try to pick up one (or more than one via product changes) now while it’s still possible.  As I finished up the first version of the post, though, I convinced myself the opposite — that for most of us there’s no reason to hurry. Then I learned that Chase claims that people won’t be able to hold multiple Freedom Flex cards, even though it is possible today to hold multiple Freedom Visa cards.  This changed the equation for me and forced me to rewrite parts of this post.  Now, I think that those with Chase Slate cards or unneeded Sapphire cards should product change to the Freedom Visa before it’s (potentially) too late.

Here are the reasons to consider getting the Freedom Visa while it’s still an option:

  1. This is the last chance to get the welcome bonus for the Freedom Visa.  It’s theoretically possible to triple welcome bonuses by signing up for the Freedom Visa now, then at any time going forward sign up for the Freedom Unlimited and Freedom Flex.  As I write this, the welcome bonuses for all three cards are identical: 20K points after $200 spend in 3 months and 5X points on grocery purchases in the first year (max $12K grocery spend).
  2. It’s the best way to expand your 5X limits (e.g. having both a Freedom Visa and Freedom Flex gives you twice us much potential spend each quarter towards 5X categories).
  3. It’s a Visa card and so it’s better than the Freedom Flex Mastercard at Costco.  Costco stores accept only Visa cards.  And Chase is known to occasionally offer 5X at warehouse clubs as a quarterly bonus category.
  4. It may have different rotating categories than the Freedom Flex.  There may be quarters where the Flex has unattractive 5X categories, but maybe the Freedom Visa will have better options.  We have since learned that the rotating categories will be the same.

In the sections below, I explore each of these arguments…

Last chance welcome bonus

Chase Freedom Visa
This card is no longer available for new applications
Chase Freedom Flex
20K points + 5X grocery + 15 months 0% APR
Chase Freedom Unlimited
20K points + 5X grocery + 15 months 0% APR

If you don’t currently have a Freedom Visa card and you haven’t received a welcome bonus for the card in the past 24 months, then you can sign up now to get the best welcome offer we’ve ever seen for this card.  Both the Freedom Unlimited and Freedom Flex have the same offer, but it’s at least theoretically possible to get all three bonuses.

Counterpoint: Those over 5/24 are ineligible for Chase welcome bonuses.  And those who are just slightly under 5/24 may prefer to pick up a different Chase card while they can.

Chase's 5/24 Rule: With most Chase credit cards, Chase will not approve your application if you have opened 5 or more cards with any bank in the past 24 months.

To determine your 5/24 status, see: 3 Easy Ways to Count Your 5/24 Status. The easiest option is to track all of your cards for free with Travel Freely.

The best way to expand 5X limits

Chase Freedom Q3 2020

Every three months, Chase offers Freedom cardholders different categories of spend that earn 5X rewards.  Through the end of September, for example, Freedom cardholders earn 5X for purchases at Amazon.com and Whole Foods.  5X earnings are limited to $1,500 spend each quarter.

Those who spend a lot in 5X categories, especially those who manufacture spend, may want more capacity than $1,500 spend per quarter.  One way to achieve that is to own multiple Chase Freedom cards.

If you already have the Freedom Visa card, Chase won’t let you sign up for a new one.  Additionally, if you’ve earned a welcome bonus for this card in the last 24 months, you won’t be eligible for a new welcome bonus.  However, the Freedom Flex Mastercard will be considered a separate product.  Doctor of Credit has confirmed with Chase that you will be able to keep your Freedom Visa card and sign up new for the Freedom Flex (and get a new welcome bonus).

Starting New

If you don’t yet have a Freedom Visa card and if you’re under 5/24, then signing up now for a Freedom Visa may be a good way to go.  The idea is that you can sign up now for the Freedom Visa and then later sign up for the Freedom Flex.  Boom.  You will now have $3,000 to spend each quarter on the 5X categories.

Product Changes

Those with a qualifying card (Freedom Unlimited, any Sapphire card, or Chase Slate) may want to product change now to the Freedom Visa while it’s still possible.  Note that you must have your account open for a year before Chase will allow these changes.  Also note that Chase doesn’t always offer the card you want as a target for your product change.  It is sometimes necessary with Chase to product change to a different card and then immediately call back to change to the card you want (weird but true).

Let’s look at a couple of scenarios where product changing to the Freedom Visa may make sense:

  • You are over 5/24 and you already have the Freedom Unlimited, Freedom Visa, and Sapphire Preferred:  One approach is to convert the Freedom Unlimited and Sapphire Preferred to the Freedom Visa now before it’s too late.  In this way, you’ll end up with $4,500 in 5X spend each quarter.  You can then later product change one of these Freedom Visa cards to the Freedom Flex so that you’ll also get the benefit of 3X dining and drugstores.
  • You are under 5/24 (3/24 or less) and you already have the Freedom Unlimited and Sapphire Reserve:  Sign up new for the Freedom Visa.  Then, after approval, product change the Freedom Unlimited and Sapphire Reserve to the Freedom Visa before it’s too late.  Then, next month, sign up for the Freedom Flex.  In this way, you’ll get two welcome bonuses and you’ll have a total of four Freedom cards that offer 5X quarterly bonuses.  That’s $6K of 5X spend per quarter.  If you were able to max out this spend every quarter, that would add up to 120,000 points per year.
  • You are at 4/24 and you already have the Freedom Unlimited and Sapphire Reserve: Product change your Freedom Unlimited and Sapphire Reserve to the Freedom Visa.  Sign up for the Freedom Flex once it is available on September 15th.

The above scenarios are a bit unrealistic in that they assume that you’re okay giving up the features offered by the Sapphire Preferred or Sapphire Reserve card.  But, of course, if you do product change these to the Freedom Visa it should (theoretically) be possible to product change back if/when you change your mind.

Counterpointed Assumptions

The strategies of accumulating multiple Freedom cards through new applications and product changes are useful only if certain assumptions hold:

Assumption: Chase won’t allow product changing to the Freedom Visa once the Freedom Flex is available.  We don’t know this to be the case.  Last I checked, Chase has still allowed product changes to the fee-free Sapphire card even though that card hasn’t been available new for a very long time.  If Chase does allow product changing after the fact, then there’s no rush to do so now.

Assumption (Part 1 of 2) Chase won’t allow product changing to the Freedom Flex from the Freedom Unlimited or Sapphire cards.  We know that Chase will allow product changing from the Freedom Visa to the Freedom Flex.  We don’t know if that product change capability extends to other consumer Ultimate Rewards cards.  My bet is that Chase will allow product changes from the Slate, Freedom Unlimited and Sapphire cards to the Freedom Flex.

Assumption (Part 2 of 2) Chase won’t allow people to acquire more than one Freedom Flex card via product changes.  We know that it is possible to have multiple Freedom Visa cards through product changes (my wife and I each have three), so I’m not convinced that things will be different with the Freedom Flex just because Chase has said so.  If both of these assumptions prove false (parts 1 and 2) then there’s no hurry to product change to the the Freedom Visa since we’ll be able to product change to the Freedom Flex instead.

Assumption: Chase will allow signing up new for a Freedom Flex if you already have the Freedom Visa.  This has been confirmed by Chase and there’s good reason to believe them.  At the time of this writing, the offer details for the Flex card state “This product is not available to either (i) current cardmembers of this credit card, or (ii) previous cardmembers of this credit card who received a new cardmember bonus for this credit card within the last 24 months.”  I think that Chase is smart enough to explicitly list the Freedom Visa in this sentence if they mean for it to be a barrier to getting the Flex card.

Visa is better for Costco

Costco stores only accept Visa cards.  The Chase Freedom card usually isn’t the best option for Costco purchases anyway since it usually offers only 1X rewards.  However, when Chase includes warehouse clubs as a Freedom 5X category, it’s a great choice.  So, if you want to preserve the occasional ability to earn 5X at Costco, having a Freedom Visa makes sense.

Counterpoint

Costco accepts Mastercards online.  Costco members with the Freedom Flex Mastercard can buy Costco gift cards online and then use those cards to pay in-store or for gas.  This may be the preferred option for most frequent Costco members anyway since you can jump online and max out your $1,500 5X spend in one shot and then use the $1,500 credit going forward even after the 5X quarter has passed.

Different rotating 5X categories

Some have wondered whether Chase will offer different rotating 5X categories for the Freedom Visa vs. the Freedom Flex.  I think that’s extremely unlikely.  Why would Chase want to manage two different 5X calendars?

In the unlikely case that they do offer different categories, it’s debatable whether or not that’s a good thing.  Those with both a Freedom Visa and Freedom Flex would be worse off with different calendars when the Flex offers an easily maxed out category and the Freedom Visa does not.

Chase explicitly told Doctor of Credit that the rotating categories will be the same.

Conclusion

Here’s a summary of the arguments and counterarguments:

  1. Argument: It’s a good way to get an extra welcome bonus.  Counterargument: This only holds if you’re under 5/24, haven’t received a bonus on the Freedom Visa in the past 24 months, and plan to also take advantage of the Freedom Flex welcome offer.
  2. Argument: It’s the best way to expand your 5X limits.  Counterargument: Whether or not this helps depends upon several assumptions.  If Chase allows product changing other cards to the Freedom Flex and if they allow multiple Freedom Flex cards as a result of product changes, then you can do just as well waiting for the Freedom Flex.  That said, the multiple Freedom Flex route is unlikely to pan out (in my opinion), so acquiring one or more Freedom Visa cards now (through new applications or product changes or both) is probably the best way to ensure expanding your 5X limits.
  3. Argument: It’s a Visa card and so it’s better than the Freedom Flex Mastercard for Costco shopping.  Counterargument: You can use the Freedom Flex at Costco online to buy Costco gift cards that can be used in-store.
  4. Argument: It may have different rotating categories than the Freedom Flex.  Counterargument: We have since learned that the rotating categories will be the same.

The bottom line is that if you are well under 5/24 and hoping to get multiple Freedom welcome bonuses, then going for the Freedom Visa makes sense.  Alternatively, if you’re eager to expand your 5X capacity, it makes sense to acquire one or more Freedom Visa cards now through product changes and (if you’re well under 5/24) a new sign-up.

Product changing to the Freedom Visa now especially makes sense for those who have qualifying cards that they don’t otherwise want.  This would likely include a Chase Slate or fee-free Sapphire. Similarly, if you want to get rid of your annual fee from your Sapphire Preferred or Sapphire Reserve, the Freedom Visa might make sense for you (although if you don’t already have the Freedom Unlimited, that might be a better choice depending on your situation).

Did I miss any good reasons for or against getting the Freedom Visa card?  Please let me know!  Comment below.

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