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The Chase Freedom Unlimited® Credit Card is a no annual fee credit card from Chase that has always been a good card to hold for unbonused spending. Its makeover in September 2020, however, turned it from a good card to hold to an excellent card that can form a key component of an Ultimate Rewards strategy.
The Chase Freedom Unlimited® Credit Card
The Chase Freedom Unlimited® Credit Card is a no annual fee credit card that offers impressive levels of cash back (or Chase Ultimate Rewards Points) on purchases in key spending categories. It also offers the best level of return of any Chase Ultimate Rewards credit card for spending in categories that don’t offer category bonuses.
Here’s what you need to know about the Chase Freedom Unlimited® Credit Card:
- $0 (zero)
Cost of authorized user cards:
- $0 (zero)
Current welcome offer:
Earn an extra 1.5% cash back on up to $20,000 of spending made in the twelve months immediately following the opening of your new account.
Note: This product is only available to applicants who do not already have this card and who have not received a new cardmember offer for this card in the past 24 months.
- 5% cash back (or 5 points/dollar) on travel purchased through Chase’s travel portal
- 3% cash back (or 3 points/dollar) on dining (includes take-out and delivery)
- 3% cash back (or 3 points/dollar) on spending at drugstores
- 1.5% cash back (or 1.5 points/dollar) on spending in all other categories
- No annual fee
- Earn valuable Ultimate Rewards Points in place of cash back when this card is paired with a Chase Sapphire Card or the Chase Ink Business Preferred® credit card (review).
- Trip cancellation/interruption insurance
- Purchase protection for 120 days after a purchase is made
How Chase pays out cash back
The Chase Freedom Unlimited® Credit Card is, at its core, a cash back credit card, but Chase awards cash back in the form of points which Freedom Unlimited card holders can exchange for statement credits at a rate of 1 point = 1 cent.
As I’ll show a little later in this post, under the right conditions, the points that this card earns can be used for more than cash back.
Why this is a fantastic card
No annual fee
The Chase Freedom Unlimited® Credit Card doesn’t charge an annual fee, so when you consider the bonus earning rates that the card offers and the fact that this card will earn a minimum of 1.5% cash back (1.5 points/dollar) on all unbonused spending, that’s pretty good going.
Great earning rates
3% – 5% cash back (not including the welcome offer) is an amazing return to be given by a no-annual-fee credit card, but for holders of one of the Chase Sapphire cards or the Ink Business Prefered Card, it gets better.
If you’re a fan of pure cash back the Chase Freedom Unlimited® Credit Card will work very well for you, but it can also be an amazing card for anyone who loves earning a valuable rewards currency and who is happy to put in a bit of extra work to maximize the value that the Freedom Unlimited Card offers.
When paired with a Chase Sapphire Card or the Ink Business Preferred Card, the cash back that the Chase Freedom Unlimited® Credit Card offers can be taken in the form of Ultimate Rewards Points. These points can be transferred to a variety of airline and hotel loyalty programs where they can be used to extract considerably more value than the basic cash back that the Freedom Unlimited card offers.
Essentially, the cash back that the Chase Freedom Unlimited® Card earns can be turned into a currency that can be used to book high-end hotels and premium cabin flights for considerably less than they would ordinarily cost.
I value Chase Ultimate Rewards Points at 1.5 cents each (based on the value I know I can easily get out of each point) and that means that in effect, the Chase Freedom Unlimited® Credit Card offers the following:
Effective rebates of 7.5% on:
- Travel booked through Chase
Effective rebates of 4.5% on:
- Spending at drugstores
- Spending on dining (including takeaway and delivery)
Effective rebate of 2.25% on spending in all other categories.
Note: Don’t forget that in the first year of card membership all of the rebates mentioned above will be increased by 1.5% on up to $20,000 of combined spending.
There are a number of premium credit cards on the market (annual fees of over $200) that don’t offer rebates as good as these, and yet the Chase Freedom Unlimited® Credit Card doesn’t charge an annual fee at all.
Also, it’s worth noting that one of the more interesting selling points of the Chase Freedom Unlimited® Credit Card is the 3% cash back (3 points/dollar) that it offers on spending at drugstores as drugstore spending is a category that rarely appears as a credit card bonus category. Considering the fact that drugstores generally sell a lot more than just pharmacy items, this is an incredibly useful bonus category to have.
Being able to earn effective rebates of between 2.25% and 7.5% courtesy of a credit card that doesn’t charge an annual fee is impressive, and it’s what makes the Chase Freedom Unlimited® Credit Card the very special card that it is.
As a standalone card, the Chase Freedom Unlimited® Credit Card is a great card to have in your wallet because the returns it offers are impressive for a no-annual-fee credit card. As a card paired with the Ink Business Preferred® credit card (review), Chase Sapphire Reserve® Card (review), or the Chase Sapphire Preferred® Credit Card (review), the Freedom Unlimited becomes one of the best no annual fee cards on the market.
Put simply, if you’re a fan of Chase Ultimate Rewards, this is almost certainly a card you should have in your wallet.