Review: Chase Freedom Unlimited® credit card (a solid no-annual-fee card)

The Chase Freedom Unlimited® card has been a fixture of the Chase lineup for years, and it has earned its place. With a $0 annual fee, a minimum return of 1.5% on all eligible spending, and a bonus rate in a category that most cards ignore, this can be a useful card to hold.

The Chase Freedom Unlimited® card

In brief

The Chase Freedom Unlimited® card is a $0 annual fee credit card that offers solid 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.

In detail

Here’s what you need to know about the Chase Freedom Unlimited® card:

Annual fee:

• $0 (zero)

Cost of authorized user cards:

• $0 (zero)

Current welcome offer:

Earn $200 cash back (or 20,000 Ultimate Rewards Points) after spending $500 on purchases in the first 3 months from account opening (terms apply)

Note: This offer isn’t available to current cardmembers of this card, or to previous cardmembers who received a new cardmember bonus on this card within the last 24 months.

Earnings:

• 5.0% cash back (or 5 points/dollar) on travel purchased through the Chase Travel℠ portal
• 3.0% cash back (or 3 points/dollar) on dining (includes takeout and delivery)
• 3.0% 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

Note: This card charges a 3% foreign transaction fee, so it isn’t a card you should use outside the US.

Key benefits:

• $0 annual fee.
• Earn valuable Ultimate Rewards Points in place of cash back when this card is paired with a Chase Sapphire Card or the Ink Business Preferred® Credit Card.
• Complimentary DoorDash DashPass membership for 6 months (activate by 31 December 2027), plus up to $10 off quarterly on non-restaurant DoorDash orders.
• 2% cash back on Lyft rides through 30 September 2027. Note that because this card already earns 1.5% on everything, that’s only 0.5% of additional cash back.
• Trip cancellation/interruption insurance – up to $1,500 per covered traveler and $6,000 per trip.
• 120-day purchase protection – up to $500 per item against damage or theft, and up to $50,000 per account. (New York residents get 90 days cover, not 120.)
• Extended warranty protection – this extends the time period of the U.S. manufacturer’s warranty by an additional year, on eligible warranties of three years or less.
• Secondary rental collision cover

How Chase pays out cash back

The Chase Freedom Unlimited® card is, at its core, a cash back credit card, but Chase pays cash back in the form of points which holders of the Chase Freedom Unlimited® card can exchange for statement credits at a rate of 1 point = 1 cent.

As I’ll show a little later in this article, under the right conditions, the points that this card earns can be used for more than cash back.

Why this is a very good card

A solid welcome offer

$200 back for $500 of spending in 3 months is a 40% rate of return on the required spending, and that’s from a card that charges nothing to hold.

Admittedly, this isn’t the biggest welcome offer we’ve ever seen on this card (we’ve seen $250 and $300 versions in the past), so if you’re in no hurry, it may be worth waiting to see if Chase brings one of those back.

Keep in mind that for holders of one of the Chase Sapphire cards or the Ink Business Preferred® Credit Card, the $200 cash back can be taken as 20,000 Ultimate Rewards Points instead, and as we value Ultimate Rewards points at 1.5 cents each, that puts the value of the welcome offer up to $300.

$0 annual fee

The Chase Freedom Unlimited® 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 eligible unbonused spending, that’s pretty good going.

Great standard earning rates

1.5% – 5% cash back is an amazing return to be given by a $0 annual fee credit card, but for holders of one of the Chase Sapphire cards or the Ink Business Preferred® card, it gets better.

If you’re a fan of pure cash back, the Chase Freedom Unlimited® 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 card offers.

When held alongside a Chase Sapphire Card or the Ink Business Preferred® Credit Card, the cash back that the Chase Freedom Unlimited® 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 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.

We value Chase Ultimate Rewards Points at 1.5 cents each (based on the value we know we can get out of each point with relative ease) and that means that in effect, you could say that the Chase Freedom Unlimited® card offers the following standard earnings year on year:

Effective rebate 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 eligible spending in all other categories.

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 fee for the Chase Freedom Unlimited® card remains at $0.

Also, it’s worth noting that one of the more interesting selling points of the Chase Freedom Unlimited® 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 with a $0 annual fee is impressive, and it’s what makes the Chase Freedom Unlimited® the special card that it is.

One negative thing to note

The Chase Freedom Unlimited® card charges a 3% foreign transaction fee, and that’s a little disappointing. Every dollar you spend abroad costs you three cents before you’ve earned a single point back and that wipes out the 1.5% return on unbonused spending twice over.

That doesn’t make this a bad card, but it does mean it’s a card that should stay at home when you travel. Keep it for your US spending, and carry a card that doesn’t charge foreign transaction fees when you leave the country.

Bottom line

As a standalone card, the Chase Freedom Unlimited® card is a good card to have in your wallet because the returns it offers are impressive for a $0 annual fee credit card.

As a card paired with the Ink Business Preferred® Credit Card, the Chase Sapphire Reserve® card, or the Chase Sapphire Preferred® card, the Chase Freedom Unlimited® card becomes one of the better $0 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.