Chase Freedom Cranks Up Rewards to 5% Cash Back

by Darwin on March 15, 2010

Today, Chase Freedom upped the cash back rewards from 3% to 5% cash back for popular categories like gas, groceries, home improvements, airline tickets and other categories that rotate periodically.  When spending outside these categories, the card pays a full 1% cash back as well.  While many credit card customers are irate over shrinking benefits, rising interest rates and companies tacking on fees, Chase Freedom’s headed in the opposite direction.  Perhaps this is an attempt by Chase to come in and woo new cardholders with a more lucrative reward package?  Whatever the motive, given the alternatives, 5% back on popular spending categories sounds great to me.

If you already pay your balance off monthly, it’s definitely worth checking out.  If you have an existing balance, you mind find some cover under the 0% APR for the first 6 months as well.  If you carry a balance that you don’t foresee paying off soon though, often times, the cash back rewards cards carry a higher interest rate than other cards without such rewards, so consider whether you’re robbing Peter to pay Paul (or worse) if your motive is to reap rewards while incurring high interest debt elsewhere.  In those cases, your best bet is to simply pay no interest with a 0% balance transfer card.

We use a combination of a couple cards and optimize spending in various categories on each to realize between $500-$800 in tax free cash back rewards each year.  This has the taxable equivalent of about $1000 per year for simply signing up for the right cards (we DO pay off in full each month).

To summarize some key stats for the Chase Freedom card:

  • 5% Cash Back in Popular Categories that rotate
  • No Annual Fee
  • 0% Intro APR for the first 6 billing cycles that your Account is open for Elite and Premium Pricing.

You can check out more on Chase Freedom here

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1 Budgeting in the Fun Stuff March 16, 2010 at 12:09 pm

The Discover More card has been doing this for years already (5% in rotating popular categories and 1% on everything else). They also have an automatic extended warranty policy (double up to 1 year), an automatic theft protection, a travel protection, discount gift cards as an option as well as cash back (I LOVE these), a $69.95 road-side service option, and awesome customer service (I’ve only had to use them once, but they made the accidental double-charge by my mechanic easy to remove). I’ve been with Discover for 9 years and am a very happy customer.

I mention this since Discover has been doing this for years. I’ve also had customer service problems with Chase when I was switched over from WAMU. They double-charged my account for my mortgage payment and it took 4 weeks to resolve completely.

Hope this helps.

2 Money Reasons March 16, 2010 at 8:20 pm

Thanks for the info! I’ve been looking for a new high payback credit card!!!

3 Earn Cash Now March 29, 2010 at 3:51 pm

I am so glad there is a better card out there than the ones I keep getting in the mail. Most of the cards suck now days

4 Charlie May 19, 2010 at 11:06 pm

Guess what? Your max savings with this card is $160/year as far as the 5% program. Thats because you only get 5% back on the FIRST $800 OF ELIGIBLE PURCHASES IN A 3 MONTH PERIOD. Do the math. This is a 1% back card. The 5% back is FALSE ADVERTISING

5 Martin S. May 25, 2010 at 11:53 am

Thank you Charlie.. I knew there was a catch given that Chase does not mention the rebate caps online, but then asks customers to refer the mailing for offer details.. That’s pretty scummy in my opinion, especially when most customers are coming to the card via web offers/advertising as opposed to actual mailings. Personally, I would stick to American Express which at least has the reputation for standing by their customers, as opposed to treating them like idiots..

6 Aaron July 15, 2010 at 5:25 pm

Actually, Chase clearly mentions the rebate caps online. And sorry Charlie, but the current 5% category has not an $800 cap, but a $1,500 cap, which would yield $75 in total rewards if maximized. The cap might change next quarter for all I know, but $1,500 is what it is for the July-September quarter.

Still, if you don’t want the $160, I’ll gladly take it off your hands.

7 Tom Pape October 3, 2010 at 3:10 pm

I’m using the Cahse Freedom card for the last 6 months and signed up for the 5% cashback program NOT once but twice. I then charged $1,000 airfares in August but have seen no cashback reward except the 1% . My question is when does Chase pay this 5% reward???

8 linda likens March 6, 2012 at 2:27 am

This is Linda Likens… I have used this chase program 5 percent cash back for good many years now. It suits mine and Bradley’s needs “t-totally” We are not big spenders, but enjoy saving a buck… Thanks Linda Likens

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