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Review: the Chase Freedom Offers 5% Cash Back

(4.5/5 - 1,111 Votes)

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The Chase Freedom can be one of the best rewards credit cards in the business, offering no annual fee as well as great rewards.

It’s a rotating 5% bonus category card, so it gives a base rewards rate of 1%, and 5% cash back in set categories that change every quarter. It’s offering a pretty good signup bonus, of $100 cash back. And it’s pretty accessible, too: you need only spend $500 in the first 3 months to get the bonus, while some credit cards want you to spend thirty times that before you get your full signup bonus. Chase has a history of pulling the plug on good bonuses just as they get popular, so if you’re considering signing up for the Chase Freedom®, you should probably hop on it.

In addition to the rewards, you get great perks too, because this is a Visa Signature card. You get concierge service, rental car insurance, purchase protection, etc.

The best of the rotating bonus category cards

The Freedom is easily the best of the three cards that give rewards on rotating categories. The Chase Freedom® gives 5% cash back on rotating bonus categories, up to $1,500 in purchases a quarter. Here are the Chase Freedom’s 2012 bonus categories.

  • Q1 (January – March): Amazon.com and gas stations
  • Q2 (April – June): Groceries and movie theaters
  • Q3 (July – September): Restaurants and gas stations
  • Q4 (October – December): Hotels, airlines, Best Buy and Kohl’s

The other two 5% cards, the Discover More and Citi Dividend Platinum Select, simply don’t give the same rewards. The Discover More’s caps for the first and second quarter are $1,500, the same as the Freedom’s, but you earn 0.25% rewards on non-bonus spending on the first $3k in purchases each year. Only then do you get the full 1%. The Citi’s rewards are capped at $300 cash back a year total, which works out to $1,500 in bonus spending per quarter and no rewards on anything else.

Chase Freedom® Visa - $100 Bonus Cash Back
Chase Freedom+-+%24100+Cash+Back Credit Card
  • Earn $100 Bonus Cash Back after you make $500 in purchases in your first 3 months
  • 0% Intro APR for 15 months on purchases and balance transfers
  • 5% Cash Back on up to $1,500 spent at grocery stores and movie theaters from 4/1/12 - 6/30/12
  • You'll enjoy new 5% categories every 3 months like gas stations, restaurants and even airlines. It's free and easy to activate your bonus each quarter!
  • Unlimited 1% Cash Back on all other purchases
  • Up to an additional 10% Cash Back when you shop online at select merchants through Chase
  • No annual fee and rewards never expire
Annual FeeSigning PromoAPR, variable*Intro APR Promotions
$0$100 Cash Bonus after spending $500 - in first 3 months
Min APR:12.99%
Max APR:22.99%
Default APR:29.99%
Cash Adv:23.24%
Purchase:0% for 15 mos
Bal Trans:0% for 15 mos

Like with the other 5% cards, you have to opt-in to the Chase Freedom®’s rewards program every quarter. Still, they notify you beforehand, and opt-ins are retroactive, so you can sign up in August and still get 5% back on July’s gas purchases.

How do you calculate the value of this card? We think it’s about equivalent to a card that gives 2% on all the bonus categories all the time, and 1% elsewhere. Think of it this way: you earn 1% on every bonus category three-fourths of the year, then 5% for one quarter, which averages out to 2%. That’s assuming, of course, that you don’t hit the $1,500/quarter bonus rewards cap, and that your spending stays constant throughout the year. This analysis actually slightly underestimates the value of the Chase Freedom® in the bonus categories, since each quarter’s categories are tailored to season-specific spending. Your spending in each bonus category is likely to be higher when you receive the 5% bonus, so your yearly average is probably a bit higher than 2%.

That’s a pretty amazing rewards deal, certainly better than the comparatively limited Discover More and Citi Dividend Platinum Select. And but for the fact that you must enroll every quarter in your rewards program, it’s fairly straightforward and simple. You can redeem in increments as small as $20, and unlike certain other rewards programs (yes, you, Citi ThankYou Points), Chase’s rewards don’t expire. The final perk of the Chase Freedom®’s rewards program is that you get access to the Chase Ultimate Rewards Mall, an online storefront that gives you up to 10% cashback on preferred Chase retailers. These include Barnes and Noble (10% cash back), Fossil (6%) and Sears.com (7%). If you shop online anyway, this is a great way to increase your savings.

How does the Chase Freedom® stack up against other rewards cards?

Chase Freedom® vs. Chase Sapphire® Preferred Card: We think that the Chase Freedom® might actually have a better rewards rate than the Chase Sapphire® Preferred Card. The latter gives 2% rewards on travel and dining and 1% elsewhere, but comes with a $95 annual fee (waived the first year). The Chase Freedom®, as we said, effectively gives 2%+ on all the bonus categories year-round. The Chase Sapphire® Preferred Card has two advantages on the Chase Freedom®: it has a signup bonus worth $625 towards travel (50,000 bonus points after you spend $3,000 in the first 3 months), and it has no foreign transaction fee. Whether the higher signup bonus is worth the annual fee depends on your spending habits, but the Chase Freedom® is better as a long-term card, because over time the disadvantages of a $95 annual fee begin to outweigh the 50,000 point bonus. The waived F/X fee is great for travelers, but isn’t as important for those who tend to stay in the States. In general, the Chase Sapphire® Preferred Card is a solid choice for those who travel abroad and for those looking for a one-time killer signup bonus, while the Chase Freedom® is a better long-term, high-value, uncomplicated credit card.

Chase Freedom® vs. Capital One Venture Rewards: The Capital One Venture is another traveler-friendly rewards credit card. It gives a flat 2% back on all purchases, and comes with a bonus worth $250 and a $59 annual fee (waived the first year). Like the Chase Sapphire® Preferred Card, it has no foreign transaction fee. Our analysis here is more or less the same as the one above: the Venture’s fantastic if you travel often, particularly if you travel overseas. It pays out its rewards in the form of a statement credit offsetting travel expenses, so it’s not as easy to use as cold, hard cash. While there’s no better travel credit card, the Chase Freedom® definitely wins out in terms of usability and ease. It’s also a great credit card to hold for a long time. If you have very few credit cards, it’s good to have one or two that you can leave open for a long time to boost your credit score. Since the Chase Freedom® has no annual fee and its rewards don’t expire, you can keep it around to lengthen the average age of your accounts and boost your overall credit limit.

Capital One® Venture℠ Rewards Credit CardChase Sapphire Preferred℠ Card
Capital+One Venture+Rewards Credit Card
Chase Sapphire+Preferred Credit Card
Signing Promo
10,000 Capital One No Hassle Miles Bonus after spending $1,000 - in the first 90 days40,000 Chase Ultimate Rewards Bonus after spending $3,000 - in the first 3 months.
Intro APR Promo
Purchase:None
Bal Trans:None
Purchase:None
Bal Trans:None
Annual fee
$0 intro for first year; $59 after that$0 the first year, then $95
Details
  • Money(R) Magazine's "Most Rewarding Card if you crave free airline flights"
  • 2 miles per dollar on every purchase, every day
  • Earn 10,000 bonus miles, equal to $100 in travel
  • Redeem your miles for any travel expense
  • No limit on the miles you can earn and miles won't expire
  • Fly free on any airline, any time with no blackout dates
  • No foreign transaction fees
  • $0 intro annual fee for the first year; $59 after that
  • Earn 40,000 bonus points after you spend $3,000 in the first 3 months - that's $500 toward travel rewards!
  • 2 points per dollar spent on travel and and at restaurants & 1 point per dollar spent on all other purchases.
  • Get 20% off airfare, hotels, car rentals and cruises when you book through Ultimate Rewards(SM)
  • No foreign transaction fees
  • Receive a 7% annual dividend on all new poinst earned - even on points already redeemed
  • 1:1 point transfer to participating frequent travel programs
  • Direct access to expert service advisors anytime
  • No Annual Fee for your first year - A $95 value

  • Tweetyiniowa

    This isn’t going on anymore. I clicked link, applied and was then told the sign up is 100.00, not 200.00. Was very disappointed. Only did it for the $200.00. $100.00, doesn’t seem worth it in my opinion.

    • Robbb

      I just got the $200 offer approved today (3/5)

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