New Bonus Categories for Chase Freedom Unlimited Now Active

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Since its launch in 2016, the Chase Freedom Unlimited® has offered cardholders a straight-forward earning structure: 1.5% cashback on all purchases. That has made the card a go-to for everyday purchases.

That simple earning structure has come to an end… but it's not bad news! Freedom Unlimited cardholders now earn bonus cashback in three categories: travel, dining, and drugstore purchases.

Related: Chase Announces New Chase Freedom Flex℠ Credit Card

New Freedom Unlimited Bonus Categories

The Freedom Unlimited now offers three additional bonus categories:

  • 5% on travel purchased through Chase Ultimate Rewards
  • 3% on dining — including dining in, takeout, and eligible delivery services
  • 3% on drugstore purchases
  • All other purchases will continue to earn 1.5% cashback

Simply put, this is excellent news. Chase has kept the best part of the Freedom Unlimited while sweetening the card with new bonus categories. These new earning rates are available to new and existing cardholders.

5% cashback on travel

The star of this announcement is the new 5% earning rate on travel purchases. To get this rate, cardholders will need to purchase travel through the Chase Ultimate Rewards travel portal. The rates are generally the same whether you book through the portal or directly with airlines and hotels. Just keep in mind that hotels generally don't honor elite benefits on reservations booked through a travel portal.

Getting 5% cashback on a no-annual-fee credit card isn't unheard of. After all, the similarly-named Chase Freedom® earns 5% cashback on rotating categories. However, cardholders only earn 5% on the first $1,500 in purchases each quarter. Not only is the Freedom Unlimited‘s new 5% travel category permanent, it's also unlimited.

3% cashback on dining

There's no lack of credit cards offering a bonus for dining. However, many of the highest-earning cards come with a hefty annual fee. That means the Freedom Unlimited‘s new 3% cashback on dining is going to be tough to beat for those looking to maximize their return from a no annual fee card.

3% cashback on drugstore purchases

While travel and dining are common bonus categories, drugstore purchases are not. Currently, no major bank credit card offers a permanent spending category for drugstore purchases. Only the Bank of America® Cash Rewards credit card lets cardholders choose to earn 3% cashback at drugstores. But that's only on up to $2,500 in combined purchases each quarter.

However, the Freedom Unlimited‘s new 3% cashback earning on drugstore purchases will be unlimited. That will make the Freedom Unlimited the card to beat for drugstore purchases.

Pairing With Chase Sapphire Cards

The real power of the Freedom Unlimited isn't in earning 1.5% cashback. After all, there are other no-annual-fee credit cards that offer 2% cashback. Instead, the way to maximize the Freedom Unlimited is by pairing it with an Ultimate Rewards-earning Chase credit card like the Chase Sapphire Preferred® Card or Chase Sapphire Reserve®.

Both of these cards earn Ultimate Rewards points that can be transferred to 13 airline and hotel partners. Or, you can redeem these Ultimate Rewards points through the Chase Travel Portal at 1.25¢ or 1.5¢ per point, respectively. Meanwhile, Freedom Unlimited cardholders only have the option to redeem earnings at 1¢ each.

However, the earnings from the Freedom Unlimited can be “combined” with the earnings from other Chase cards. That means Sapphire cardholders could use the Freedom Unlimited to effectively earn (at least) 1.5X Chase Ultimate Rewards points on all purchases.

Will this amazing opportunity go away?

I got a chance to talk with BJ Mahoney—the General Manager of Chase Freedom—about the changes to the Freedom Unlimited. I made sure to ask if Freedom Unlimited cardholders will still be able to combine earnings with points earned through the Sapphire Preferred and Sapphire Reserve.

Thankfully, Chase is leaving this option intact. Cardholders will still be able to combine their earnings between the Freedom Unlimited and Ultimate Rewards-earning credit cards. That means Sapphire cardholders can use the Freedom Unlimited to effectively earn 5X Ultimate Rewards points on travel booked through Chase and 3X Ultimate Rewards points on dining and drugstore purchases.

Current Freedom Unlimited Sign-Up Offer

Eligible new Freedom Unlimited cardholders can earn a $200 bonus after you spend $500 on purchases in your first 3 months from account opening. Plus, new cardholders will also earn 5% cash back on grocery store purchases (not including Target® or Walmart® purchases) on up to $12,000 spent in the first year.

If you're able to maximize this offer, you'll earn at least $600 cashback from grocery purchases in addition to the $200 sign-up bonus. That's at least $800 cashback. Or, transfer those earnings to an Ultimate Rewards-earning card to turn that into 80,000 Chase Ultimate Rewards points. For those earning points as a team, the good news is that you can combine Chase Ultimate Rewards points with others in your household.

Our Thoughts

The Freedom Unlimited was already a favorite of travelers looking to maximize their spending. The addition of 5% cashback on travel purchases through Chase Ultimate Rewards and 3% cashback on dining and drugstore purchases is a huge boost to the value this card offers. Plus, all other purchases will still earn 1.5% cashback (or Ultimate Rewards points). That makes the Freedom Unlimited even more indispensable than before.

What do you think about the changes to the Freedom Unlimited?

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Comments

  • It’s similar to Chase Flex now in terms of points offering.

  • Keith Dsouza says:

    I like the Dining category on this card, not sure if I should downgrade my CSP to this one now because I have been using that card mostly for Dining only.

  • It is great bez it no AF. This give those with CSR a chance to consider DG to CSP. Losing a lot of benefits that CSR have like the travel insurance, delays and baggage delay, em emergency medical and dental of $2500. PP to name a few. The FX will be the issue for foreign travel.

    5x on portal for air travel and hotel sound good in theory but booking via the portal aka Expedia is not the best ting when there is any issue w the flight. Let me point out that the fare is doable or same when it is economy flight but it’s high for premium and biz. With the CSR 3x is a very generous and bro’s coverage on any travel category which seems like the new card won’t have.
    The drug store purchase, does it come with any limitation. Is online purchase valid for 3%

    The big plus is 5x on grocery but only limited time $12k on the 1st yr.
    With UR having less transfer partner only 1 bonus transfer to airline to date. Is one of the issue I have to bite the bullet and add Amex to diversify.
    What about the Lyft bonus that CSR is offering 10x and the rest at 5x. No mention of that

    What benefits comes with the card?

    • Online drug store – I would guess yes it will count, but we don’t know for sure.
      We’ll be adding more content about Lyft and how to structure your Chase earning strategy when the Flex card launches.

  • So how would this work when stacking with the CSR for travel bookings through the Chase portal with the CFU? So, would I use the CSR for the 50% bonus on points and then use the CFU for any cash portion remaining on the trip cost? Or if I’m paying with cash only? Thanks.

    • I don’t think that you’ll have the opportunity to split payments between the CSR (using points) and CFU (for the cash portion). I’m pretty sure you’ll have to choose one or the other.

      I’m thinking my strategy will be to book trips through the Chase portal with a CFF or CFU to earn 5X. Then, I’ll transfer my CFF/CFU earnings to my CSR and redeem for statement credits for grocery purchases (or other eligible purchases) at 1.5c through Pay Yourself Back.

  • I appreciate the drugstore category wish Chase had offered, instead of dining and travel, two other categories that didn’t overlap with those already covered by the CSP and CSR, especially travel, since the CFU lacks the CSR’s travel protections.

  • Come to think of it, although I will definitely still hold the CSR, the 3x on dining for the Freedom Unlimited does make the CSR a little less valuable since I’d now be keeping that card only for the 3x on travel.

  • Given that the the freedom unlimited card will offer the same percentage back as the Reserve on dining now, there’s less incentive to have the Reserve.

  • This is amazing news. With 5% on travel and 3% on dining, this of course begs the question about what will happen to the Sapphire Preferred and Reserve cards. Hope those get made over soon as well!

  • Do these new bonus categories apply to existing cardholders? The way it says 5x on groceries for the first year makes me think it’s just for new signups.

    • The bonus categories will apply to all existing cardholders effective 9/15/2020! Only the grocery spending bonus is tied to new accounts.

  • I got the Freedom Unlimited a year ago when Chase was offering double points for the first year. Now that year is up, and I will be cancelling this card soon. There is very little in the new offering that intrigues me, so I’d rather just simplify my wallet.

  • I really like these benefits but would rather than add categories that don’t overlap with the sapphire reserve

  • Prefer to get cashback for my hotels stay. This is a good news for my next trip to HongKong.

  • This is a good news to save my money. Hope AE can be also have those promos. But hate chase 5/24 rule.

  • Weng Keong P Loh says:

    Whow. Thats awesome. which they give the same for ink. Don’t know if I should risk trying to apply

  • Another thing to consider is where is the break-even point for the CSR? The main selling point is the net $150 fee after the $300 travel credit. But, based on this, your essentially paying $150 to hold on to a card so you can get a better redemption rate on points earned on a second card. My cocktail napkin math says you would have to spend $5300 on travel to offset the CSR annual fee. It may become where I only use the one card with no annual fee.

  • This seems to really devalue the CSP and CSR – really keeping it only for the transfer partners at this point.

  • David Miller says:

    Since we’re not traveling in the immediate future, and thus my Sapphire Reserve benefits are useless, plus the annual fee is coming up, I’m thinking of dropping down to a Freedom Unlimited card. Is that smart? Would I be able to keep all my earned points and instead of getting cash back, earn points in my Ultimate Rewards account for using the Freedom card? I apologize if this is a frequently-asked question. Thanks.

    • It’s a good question. It all depends on how you plan to use the points. If you have a bunch of points and are happy redeeming UR points through the Chase portal, you might want to keep the CSR for the 1.5c redemption rate. If you plan to transfer those points to airline partners, you may want to downgrade to the CSP instead. That way you can keep the ability to transfer but at a lower fee. If you don’t have many points saved now, switching to the Freedom Unlimited doesn’t “cost” you that much (1.5c vs. 1c redemption rate doesn’t really matter if you only have 100 points)

  • But, if you use the the Freedom Unlimited on the Chase portal, you don’t get the travel protection benefits like you would with the CSR or CSP, right?

    • That’s a good point. The Freedom Unlimited doesn’t have travel protections. So, I’d probably use the CSR on inexpensive flights and Freedom Unlimited on costlier flights. The decision point all depends on your valuation of UR points and how much you’d “pay” (in reduced earnings) for the travel insurance.

  • Probably won’t see that on a no AF card, at least I can’t think of one that waves them. Still, these new bonus categories are great news for existing card holders, for sure.

  • The CFU was already top-of-wallet for me, and now they just put it in *HULK* mode. The main reason to use my Sapphire Preferred now is when booking directly with Hyatt and paying tolls. Otherwise, it’s my Freedom Unlimited or Freedom (Flex) for the Chase Travel Portal, since I’m generally brand-agnostic as a beginner.

    This upgrade just shaved a few other cards off my future applications. 🙂

  • lorem ipsum says:

    What is the reason airlines generally honor benefits on OTA bookings, but hotels do not?

    • The commissions are generally very small for airfare but substantial for hotel bookings. So, airlines aren’t losing out on much if you book through an OTA, but hotels really want that additional revenue.

  • It’s tempting. I would really consider the offer if I can apply

  • Christine Burri says:

    I am so excited to hear about this. I was thinking about getting the Freedom Card to go with my CSP and Freedom Unlimited. Don’t really need to think any more. What I got will be just fine 🙂 This will really help me get some awesome savings for my trip next year.

  • This is truly awesome news.
    I just wish they would get rid of the foreign transaction fees on the Freedom Unlimited card though.

  • Wow! I already really love the Chase Freedom cards and now this addition? I use my Freedom Unlimited quite a bit and this will really help. This does make me think about using Chase portal more for airline tickets. I will stick to the hotels to book them, which we all need to complain more about them not allowing benefits if booked through a travel agent. This is will really help me earn more UR points for my husbands birthday trip later.