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Chase Freedom Plus – received third statement

Ever since I switch to Chase Freedom Plus as my primary credit card, I have been trying to keep an eye on my spending and accumulated rewards. Last week I received my third statement and can share some more details on the benefits the Plus upgrade offers compared to the regular Chase Freedom card.

First of all, when I signed up, the card came with miles rewards and I have still not been able to switch to the cash rewards mode. I called the customer service a couple times but several weeks later I still see miles in my account rewards page. The whole procedure also resulted into some mess in the rewards reported online. Last month reporting was partially frozen and I now see those rewards credited back to me as an adjustment.

Difference between miles and points

The main difference is in the options available for redeeming rewards. In the miles mode, a $50 Shell Gift Card in exchange for 5,000 reward miles is probably closest you can get to cash. There are more options if you are willing to travel, for example an unrestricted round trip ticket to any destination (max value $350) for 25,000 rewards miles looks very interesting. In the cash mode your best option is to wait till you collect 20,000 points and exchange them to a $250 check. This is what I have always done with the old card.

Charging travel on Chase Freedom is not a good idea

My total bill this month came to $3719. We are planning a trip to my friends’ wedding for June, hence more expenses than usual. A big chunk of it is the tickets from United Airlines. They were correctly categorized as “Travel” on the account activity page but are missing from the Top Purchase categories on my bill due to the fact that “Travel” is not one of 15 categories currently covered by Chase (scroll down for the complete list of covered categories). I would have gotten a better deal if I used my Costco American Express for this purchase since it offers straight 2% on travel related expenses.

On average this card pays 3.75% straight cash rewards

My overall bonus earnings this month came to 2,222 miles (or points) which means 30% of my spendings qualified for bonus rewards. This is much less than I had during the first month (48%). If I exclude travel (tickets and car rental) then the percentage goes up to 52%. Looking back at the last 3 months, 42% of my spendings qualified for bonus rewards, 55% if I exclude this month’s travel. This overall means that the card pays back approximately 3% straight rewards, or slightly more (3.75%) if you wait to convert 20,000 points into $250 check.

Spending categories eligible for bonus rewards

Here is the complete list of 15 categories that qualify for Chase Freedom bonus rewards. Out of these, the top 6 categories by spending will be used to calculate your rewards.

  • Department stores
  • Utilities
  • Fast food & quick service restaurants
  • Gas & convenience stores
  • Drugstores
  • Cable/Satellite TV, internet providers
  • Pet supply stores/veterinarian
  • Phone/cell phone bills
  • Movie theaters
  • Grocery stores
  • Gym memberships
  • Beauty salons/SPAs
  • Movie rentals
  • Dry cleaners
  • Local commuting

Please share your own experience in the comments. Have you had problem switching from miles to cash like I did? What is your average cash back rewards rate on this card?

Secret History of the Credit Card (tonight on PBS)

My recent $39 late fee from Chase has sparkled a small investigation on my part.

Do you have a credit card? Are you a “dead beat” or a “revolver”? Do you know how long it would take to pay your credit card balance if you only made minimum payments? Do you know why your Citibank (and many other) credit card bills come from South Dakota and not any other state?

Tonight PBS is re-airing their super-popular “Secret History of the Credit Card” program and you can find answers to these and many more questions. You can watch the show online at pbs.org as well. I just did. Here is my favorite quote (about credit card companies):

These guys have figured out, the best way to compete is to put a smiley face on your commercials, a low introductory rate, and hire a team of MBA’s to lay traps in the fine print

About the late fee, I did manage to get rid of it, but it turns out there are millions who pay day in and out.

Just like gambling, credit card industry plays on people’s weaknesses, but unlike gambling you have an unrestricted ability to get your self into as deep a hole as you can dig for your self, and you can do it without even leaving your house!

Chase Freedom Plus – received first statement

I recently signed up to Chase Freedom Plus, a new credit card from Chase which seems to be a pretty good all around rewards card (at least judging from what I currently know). Last Friday I received my first statement and can now take a closer look at what this card is really worth.

First of all, the Chase Freedom Plus offer comes with 10,000 miles ($100) sign up bonus rewards which are correctly reflected in my statement. Now let’s look at the other rewards.

Bonus rewards categories

Chase doesn’t give you a lot of details as to where your rewards come from. All you can see from the statement is the total of your regular rewards (1% of your total statement balance) and your bonus earning (2% of what you spend in the top 6 categories). You also get to see what categories were used in your bonus earnings calculations. Here is my list for this month:

  • Department Stores
  • Drug Stores
  • Gas & Convenience Stores
  • Grocery Stores
  • Local Commuting
  • Quick Service Restaurants

Unfortunately there is no way to see how the bonus rewards are split by category, nor can you see what category your sale transactions are assigned to, which really sucks. I wish I could verify my Local Commuting expenses. I don’t recall ever using public transportation last month. (update: the transactions categories are recorded on the Current Activity page, read the discussion in the comments)

Bonus rewards cap

The old Chase Freedom card had a $12 per statement period cap on your bonus rewards. The Plus card is supposed to lift that cap. Since I just signed up, my statement period is shorter than usual and my bonus rewards came in just 92 miles (92 cents) short of the old limit, which means I can’t verify if this cap is in fact lifted. I will do so next month.

My total bill came to $1,165 which means that 48% of the total amount was used in the bonus rewards calculations. Chase distinguishes a total of 15 spending categories. 6 of these are used in bonus rewards calculations which leaves me with 9 categories that were used for the remaining 52% of my bill.

I am somewhat disappointed with this number. I expected top 6 categories to cover at least two thirds (66%) of my spending. Could it be that Chase doesn’t categorize some/many transactions?

Redeeming rewards

I still have to figure out how I can redeem my rewards. With the regular Chase Freedom card I called the customer service and changed my account from points/miles to cash back and then just received checks. I have not yet done so for Chase Freedom Plus. I did click however at the Redeem Rewards link in my account to find that the closest thing to cash that I can buy online for my miles is a $50 cash card for Starbucks, Shell, or ExxonMobil, each is priced at 50,000 miles. There are also $25 cards that go for 30,000 mies.

Another thing I want to clarify as well is if I can redeem $200 accumulated rewards for $250 in cash like I could do it with the old card effectively increasing my rewards rate. I will try to get a hold of a customer rep. this week to find it out.

Conclusion

All in all, it is too early to say if this card is really better than the old one. If Chase Freedom Plus indeed doesn’t have a rewards cap like the old card does then it might indeed be the card of choice for me, even if I can’t get the $250 for $200 deal which I suspect is the case. Also, one shouldn’t forget about the $30 annual fee that kicks in after introductory year is over, which throws in yet another variable into this equation.

Have you signed up to this offer? What is your experience? Please share in the comments.

Sony Rewards “canned deal” – spend $500 get $100

Deal in a can from Sony RewardsToday I received a strange package in mail. It was a can, very much like a regular aluminum can for soda drinks but inside it had an offer from Sony Rewards program. This is the first time I receive a promotional material in a can so not surprisingly it got my attention.

In that “canned” offer the folks from Sony Rewards suggest to register my Sony Credit card at www.sony.com/sonycard/flyfree, spend $500 before March 31, 2008 and receive 10,000 bonus points. This is not all the fun though. After I receive my 10,000 points I can spend $300 more from April through June and receive one companion voucher for a round trip US flight - free with a purchase of an adult ticket (more details here).

The tickets have to be purchased in advance from Lifestyle Vacation Incentives a Sony partner in this promotion, so my guess the prices will probably not be all that low, however even w/o the ticket 10,000 points in rewards for spending $500 on stuff you would buy anyway is probably worth it. Sony claims that 10,000 is worth $100. Just to get a better idea, 10,000 points will buy you a home stereo like this or a 2GB video MP3 player like this from the Sony Rewards online shop.

I quickly checked my Sony Card records and have found that I canceled all of the cards I had, otherwise I would probably give this deal a shot. If you have not got rid of your Sony Card like I did though, I suggest you to visit the website above and take a look at this promotion. Sounds like a pretty hot deal to me!

Chase Freedom Plus – 3% cash back in 6 categories

Chase Freedom PlusChase has lured me in with the $250 sign up bonus last March and despite the usual fate of cards with these promotional offers (I tend to close most of them after some use) this one stuck with me thanks to the great cash back rewards it offers.

In fact it has become my primary credit card ever since except for dining and travel expenses which I still charge to my American Express from Costco.

I have just learned that Chase has sweetened the Freedom offer with a Plus card which in mostly the same card but with certain important improvements.

How does Chase Freedom work?

Chase sorts out all your spendings into a few categories like Gasoline, Eating out, Groceries, Utility bills, etc. At the end of each statement period Chase picks 3 categories where you spend the most and pays you back 3% in cash back or points, whatever you choose. In addition you earn a flat 1% on everything else.

If you wait till you collect $200 in rewards then the amount goes up to $250 essentially turning your 3% into 3.75% and 1% into 1.25%

How is Freedom Plus different?

I called the number on the application screen and spent some time verifying the information. It appears there are two important changes according to the rep.

  1. The number of bonus categories increases from 3 to 6;
  2. The rewards cap for bonus categories is lifted

These are very good changes. The traditional Chase Freedom card caps the extra 2% you could earn to $12 per statement period. I have been hitting that cap consistently over the past months effectively under-earning rewards. No cap for me would mean more rewards.

While on the phone, I also confirmed that this new card has no $30 annual fee which was mistakenly mentioned on one of the application pages.

Update: a reader reports that there is a $30 annual fee which is waived the first year. The reps at the application hot line refer to it as a “membership fee”

New customers get 10,000 miles

The application page also mentions a 10,000 miles bonus for new customers which they earn after the first purchase made on the card. I am not sure what happens if you vote for cash back instead of points when you apply for the card. I will update this post as I find more information about this promotion.

Should you apply?

If you already have the regular Chase Freedom card, the upgrade should be a no-brainer. The Chase Freedom Plus is arguably the best card on the market for average folks.

If you don’t think your spending pattern falls under the “average” category, you might consider other cards. There are some good promotions mentioned here, also this post summarizes how I personally use credit cards.

Update 03/15: I received my first Chase Freedom Plus statement. Read more here.

Update 03/28: Popular merchants not included in the 15 Chase spendings categories can be found here.

Update 04/05: What is the breaking point in monthly spendings when Chase Freedom Plus start to beat the old Chase Freedom card in rewards? Find out here.

Update 05/08: Received my third statement. Read about it here.




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