Keep up With the Rotating Categories to Earn the Most
Credit Needed: Good/Excellent
There is no doubt that the Chase Freedom card is a fan favorite among credit cardholders. Its earning system is pretty straightforward, there’s no annual fee and the card offers incredible earnings. Not only does the Chase Freedom card offer cash back, but it provides the opportunity for cardholders to earn bonus cash back. This is done through rotating categories each quarter. The categories vary per year, but they have previously included gas stations, commuter expenses, supermarkets and drugstores.
You must opt in to the bonus category each quarter. Once you’ve done that, you’ll earn 5% cash back on up to $1,500 in combined purchases in that category. You automatically earn 1% back on all other purchases. Should you forget to opt in to a quarter, your purchases will earn only 1%. Luckily your cash back rewards will never expire as long as your account is open and in good standing. There is also no limit to how much you can earn at the 1% cash back rate.
Once you sign up for the card, you will have three months to spend $500 on purchases to earn a $150 bonus. After opening your account, the first 15 months are subject to a 0% intro APR for purchases and balance transfers. After that period, the variable APR of 16.49% - 25.24% Variable applies.
Additionally, balance transfers and cash advances come with a transaction fee. Cash advances cost $10 or 5% of the amount, whichever is greater. Balance transfers come with a 3% or $5 intro for the first 60 days, after that they are $5 or 5% of the amount, whichever is greater. Foreign transactions also come with a fee of 3% of the transaction amount.
Chase tracks your earnings as points. As a cash back card, you can take the cash back through direct deposit or statement credit. However, you could also convert your cash back to points, meaning 100 points for every dollar spent. You can then use these points to shop on Amazon, buy gift cards or book travel through Chase Ultimate Rewards. Chase’s Ultimate Rewards Program is an extensive rewards program that includes the Chase Freedom card.
No annual fee – The Chase Freedom card does not have an annual fee.
No penalty APR - While there is a late payment fee, you won’t have to worry about a penalty APR.
$150 bonus - Earn a bonus of $150 after spending $500 on purchases within the first three months.
Rotating categories - Special rotating categories mean that you can earn extra cash back within a certain quarter when a category is specified.
0% intro APR - The APR for purchases and balance transfers will be 0% for the first 15 months of having the card. After that period, the variable APR of 16.49% - 25.24% Variable applies.
High rate of cash back - With special rotating categories, you can earn up to 5% on specific purchases.
Redemption options - Not only can you earn cash back, but you can instead redeem points for rewards like Amazon purchases, gift cards or travel expenses.
Extra protections - Chase ensures your safety and comfort as a cardholder. This means protection for fraud, stolen or damaged purchases, merchandise prices, extended warranties and merchandise returns.
Who it Benefits
The Chase Freedom card stands to benefit the everyday credit cardholder. With its special categories including groceries, gas stations and drug stores, your everyday purchases could earn you some huge rewards. You just have to make sure you have opted in and you’re using your card in the right places at the right times to score the big rewards. Otherwise, your purchases will only earn 1% cash back.
To benefit from this card, you will have to make sure you will be using the card often for the above categories (among others). But you also have to remember that your 5% cashback earnings are only limited to one category per quarter. So you will have to be OK with either strategizing your spending to maximize your earnings, or sometimes earning only 1% on purchases.
How it Works
The Chase Freedom card is a cash back card with rotating special categories. Your spending within a quarter’s specified category will earn you 5% cash back on up to $1,500. After you spend $1,500, you earn 1% back on the rest of your purchases with no caps. All other purchases will still automatically earn 1% cash back, again with no limit. Your rewards will never expire as long as your account is open and in good standing.
The special categories include, but are not limited to, groceries, gas stations and drug stores. Note that you will have to opt in for each quarter’s category in order to earn the bonus 5% cash back. You can activate online or via text, email, phone, Chase location or ATM. Luckily, as long as you activate before the deadline for each quarter, your purchases can retroactively earn 5% back. Activating after the deadline, however, means your purchases earn only 1% back.
Within the first three months of signing up for the card, you can earn a bonus of $150 by spending $500 on purchases.
The card does not have an annual fee or a penalty APR. It also carries an intro APR of 0% for purchases and balance transfers for 15 months. After that, the normal variable APR of 16.49% - 25.24% Variable applies to purchases and balance transfers. Cash advances come with a 26.49% Variable APR. Balance transfers and cash advances come with their own fees. Cash advances cost $10 or 5% of the transaction amount, whichever is greater, while balance transfers cost $5 or 3% for the first 60 days or $5 or 5% of the amount, again, whichever is greater after the intro period is over. Foreign transactions made on the card will also trigger a fee of 3% of the transaction amount in U.S. dollars.
What's the Catch
The Chase Freedom card is a pretty good card on the whole. However, there are a couple catches to the card. For one, you have to manually opt in each quarter to earn the 5% cash back on the special category. It is not done automatically, so you do have to pay attention to each quarter’s categories and deadlines. You can opt in to the special reward categories online, through text or email, by phone or by visiting a Chase location or ATM. It’s worth noting that you can still activate late in the quarter, as long as it’s before the activation deadline. That way, your previous quarter purchases can still earn 5% cash back. Should you forget to opt in, however, all your purchases will only earn 1% cash back.
The other catch to the Chase Freedom card is that you earn 5% back on up to $1,500 in combined purchases in bonus categories each quarter. So any purchases you make after you’ve already spent $1,500 within the category earns 1% cash back. So if you think you’re going to be spending more than $1,500, either be aware that not all your purchases will earn 5% back, or consider a different card.
Just the Math
You earn 5% cash back on a different category each quarter. The 5% cash back applies until you’ve spent $1,500 in that quarter. After that, you earn 1% cash back with no limits on how much you can earn.
There is also a sign-up bonus of $150 if you spend $500 on the card within the first three months.
Balance transfers from this card will cost you either $5 or 5% of the transaction amount, whichever is greater after the first 60 days. If you transfer a balance during the intro period of the first 60 days you will save some money as the fee is 3% or $5 whichever is greater.
Balance transfers come with a 0% intro APR for the first 15 months. After that, the variable APR is between 16.49% - 25.24% Variable, depending on your credit score.
How it Stacks Up
If you’re specifically looking for rotating rewards, there are other options, as well. One option is the Discover it Cash Back card. It offers 5% cash back in rotating categories on up to $1,500 and 1% back on everything else. The categories include the standard grocery stores and gas stations, but also includes Amazon.com. You will also have to activate for the bonus 5% each quarter. With no annual fee, the Discover card trumps the Chase Freedom card in a few ways. It does not charge a foreign transaction fee for one. But mostly, the Discover it Cash Back card impresses by basically doubling your cash back rewards. You earn when you buy, but that amount is then matched at the end of your first year on your credit card.
U.S. Bank also offers a rotating categories card, the Cash+ Visa Signature Card. Interestingly, this card gives you the option to choose your cash back categories, rather than them being determined for you. You can earn 5% cash back for the first year on your first $2,000 in eligible purchases each quarter on the combined two categories you choose. You choose from a given list that includes more specific categories like fast food restaurants or sporting goods stores. You also can earn 2% cash back for the first year on your choice of one everyday category (i.e. gas or groceries). You earn 1% cash back on everything else and if you forget to choose your special categories. The card also offers some good sign-up bonuses, all for no annual fee either, making the Cash+ Visa Signature card a pretty nice option.
Annual percentage Rate (APR) for Purchases
0% Intro APR on Purchases for 15 months. After the intro period ends a 16.49% - 25.24% Variable APR will apply, based on your credit-worthiness.
APR for Balance Transfers
0% Intro APR on Balance Transfers for 15 months. After the intro period ends a 16.49% - 25.24% Variable APR will apply, based on your credit-worthiness.
APR for Cash Advances
Pay 26.49% Variable for cash advances. The APR will vary with the market based on the Prime Rate.
How to Avoid Paying Interest on Purchases
Your due date is at will be a minimum of 21 days after the close of each billing cycle. You will not be charged any interest on purchases if you pay your entire balance by the due date each month.
Minimum Interest Charge
Balance Transfer: Intro fee of 3% or $5, whichever is greater on transfers made within the first 60 days of account opening. After that, 5% or $5 of the amount of the transfer, whichever is greater.
Cash Advance: $10 or 5% of the amount of each transfer, whichever is greater
Foreign Purchase Transaction: 3% of each transaction in U.S. dollars
Late Payment: Up to $39
Returned Payment: Up to $39
The Bottom Line
The Chase Freedom card definitely provides a solid cash back return. At 5% cash back for specific categories, you can really earn a lot back on your everyday spending like for gas and groceries. You do have to make sure that you are activating the bonus each quarter. But even when you don’t opt in, you still earn 1% cash back on all purchases with no limits.
With a sign-up bonus and no annual fee, the Chase Freedom card makes sure that you earn cash back, and keep on earning. You will just have to watch out for cash advance fees, balance transfer fees and the end of the intro APR period.
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