Are Double Points on the Chase Freedom Unlimited Worth It?

Tl;dr: Chase’s Freedom Unlimited is offering double cash back–the best earning rates on the market in almost every category–for the next year. And it still might not be worth it. 

I am not a fan of Chase’s credit card offerings, in large part because their setups are somewhat complicated. Their benefits and bonuses tend to cannibalize each other, the annual fees on the Sapphire cards are somewhat steep, and while the Freedom Flex offers great bonus opportunities, it requires keeping track of a rotation category calendar, registering every three months, and moving the card in and out of your wallet. Bleh. 

But Chase’s current bonus offer on the $0-annual-fee Freedom Unlimited requires some pretty close examination. Chase is currently offering (unlimited!) double cash back on all your points earned in the first year. While double obviously sounds good, it might not be obvious that this is best-credit-card-on-the-market good. Even so, I still don’t think this is a particularly good offer, or a particularly good reason for most people to dive into the Chase ecosystem.

What’s so great about it?

The earning opportunity here is undeniably great. The card’s baseline earnings are 5% cash back on travel booked through Chase, 3% on dining/takeout/delivery, 3% at drugstores, and 1.5% on everything else. Those earning rates are among the best in the business. When doubled, they are the best in the business, and in some cases by a wide margin. Nothing will get you 3x on everyday spending. The Bilt card will get you 6x on dining, but only one day per month. This offer would net you 6x every single day. With no annual fee. 

It earns Chase points that can be redeemed for cash back at that rate, but can also be redeemed as Ultimate Rewards points if you have a UR-earning card. So if you have (or later decide to pick up) a Chase Sapphire card, you could take those points and transfer them to partners like United Airlines, Southwest Airlines, or Hyatt. You could also use them with the Sapphire 25% (Preferred) or 50% (Reserve) bonus when booking through chase. So spending $100 on a meal out would earn you $7.50 toward a flight, cruise, hotel, or rental car on Chase’s booking platform if you have a Chase Sapphire Preferred; $9 if you have the Reserve. That is an extremely good rate of return. 

What are the drawbacks?

To get the most value out of this card, you really need to invest somewhat in the Chase ecosystem, especially by picking up a Chase Sapphire card. They are solid cards and a lot of people love them. But, again, I’m not a fan. To really get the most out of them you need at least three different cards and a healthy amount of effort and organization (eww). And, even then, the earning rates are always great but almost never the best out there.

And that’s the main problem with this card after the first year. As a no-annual-fee card, it’s fairly harmless to hold. But will you want to use it? 1.5% cash back is a solid baseline earning rate, but you can do better with the Capital One Venture X, the Citi Double Cash, or the Wells Fargo Active Cash. 3% back at restaurants is good, but you get that with any number of cards with more valuable points, like the Bilt card, or get 4x points on dining with the Amex Gold. It’s simply second-best in the vast majority of spending categories.

This card is the best for spending at drugstores, though, so if you occasionally drop into one, that might justify keeping this no-fee card long-term.

How’s the sign-up bonus?

Here’s the rub. The double points offer is the bonus, in lieu of the more typical $200 cash back after meeting a minimum spend requirement. Is that an improvement? Depends on how much you spend! But you’d need to spend a little more than $6,000 on dining or $4,000 on flights just for that double cash back to equal the $200 you could have gotten upfront on the normal offer. You would have to spend over $13,000 in a year on non-bonus categories for that extra 1.5% cash back to be worth $200. With a mix of spending across the bonus categories, you would likely need to spend about $10,000 before seeing any benefit from this offer compared to the normal one. That’s a lot of spending, and spending that won’t be able to be used for lucrative sign-up bonuses on other cards. 

Chase currently has another sign-up bonus on the card that actually looks more promising. It offers the normal earning rates, plus the $200 bonus after spending just $500 in the first three months, plus 5% back on gas and grocery purchases (up to $12,000 total) for the first year. Unless you’re planning to spend a lot of money dining out and booking flights through Chase’s travel portal, this offer is probably the better deal. 

Conclusion

The double-points offer is a lesson in the importance of not overestimating the power of earning rates. It’s important to have a good basic setup, but beyond that point it takes a lot of spending for incrementally higher earning rates to pay off significantly. Here, even with a card that offers just about the best earning rates available on almost every category (for a one year period), it would take many thousands of dollars just for that bonus to equal the $200 the card usually hands out as a sign-up offer. If you spend a lot on gas and groceries, you would almost certainly be better off with the $200 + 5% on gas and groceries offer. 

But that just brings me back around to the issue with Chase cards. The Freedom Unlimited is fine, but why not get a Custom Cash with its $200 bonus and a 5% earn rate on (either) gas or groceries that you can use not only for one year, but forever? Personally, that would be my choice.