Chase has several credit cards to choose from that can fit borrowers’ needs. The Chase Sapphire Preferred and the Chase Freedom card have several similar pros and cons. The big difference between them? One is best for travel while the other is best for basic cash-back rewards.
This is a great card for people with excellent credit who love to travel, especially right now because of the card’s current signup offer: Earn 50,000 bonus points after you spend $4,000 on purchases in the first three months — that’s $625 toward travel when you redeem through the company’s Chase Ultimate Rewards program.
Perhaps you have a family and want to go to Europe. You spend $4,000 on four plane tickets to Germany or Spain with your Chase card, then you can earn $625 back, almost paying for one ticket.
But that’s not all. There are more travel and other perks associated with this card. Here is a breakdown of the details, pros and cons.
- Travel: Earn two times the points on travel purchases, including airfare, hotels, taxis and trains. Other travel perks include car rental collision damage waiver, trip cancellation and trip interruption insurance, trip delay reimbursement and baggage delay insurance.
- Earn 5,000 bonus points after adding an authorized user in the first three months
- No foreign transaction fees
- Dining: Earn two times the points at restaurants worldwide
- Other purchases: Earn one point per dollar on every other type of purchase
- 0% annual percentage rate (APR) for first 12 months. After that, APR can be as low as 16.49%, depending on your creditworthiness
- Current cardholders are not eligible for these sign-up offer rewards
- $95 membership fee after the first year
- APR can go as high as 23.49%, depending on your creditworthiness
- 5% or $5 balance transfer fee, depending on which is greater
- 5% or $10 fee for each cash advance, whichever is greater
- Late payment fees of $15 to $37, depending on your balance
This card is best for people who want cash back. Period. There’s a sign-up bonus going on right now — $150 when you spend $500 in the first three months — and several cash-back options, depending on your spending category. Unlike the Chase Sapphire Preferred card, there is no annual fee for this card, even after the first year.
Let’s take a look at the details of this card: the pros and cons and all of the other things to consider when signing up for a new card.
- No annual fee.
- 5% cash back in certain revolving purchase categories, including gas stations and restaurants, up to $1,500
- 1% cash back on all purchases
- 0% introductory rate on purchases and balance transfers for the first 15 months
- If you add a qualified user to the card, you can get an additional $25 bonus
- Doesn’t offer a low APR. The APR is 15.49% to 24.24%, depending on your credit rating
- 5% fee on balance transfers
- Late payment fees range from $15 to $37
- $37 return payment fee
- Not very travel-friendly. Users are charged 3% on the purchase of any foreign transaction
- $10 or 5% cash advance fee, whichever is greater
So if it’s travel rewards you’re after, apply for the Chase Sapphire Preferred card while the bonus offer lasts. It’s difficult to beat 50,000 sign-up points. And remember, the cash back just for signing up and spending $4,000 could pay for one or even two plane tickets, depending on where you’re going.
And it’s not just good for getting you to a new place, it has great travel benefits once you arrive. Remember, you can earn two times the points on travel purchases, including airfare, hotels, taxis and trains. If you rent a car, the car rental collision damage waiver is a perk of this card. So is trip cancellation and trip interruption insurance, trip delay reimbursement and baggage delay insurance. Also, there are no foreign transaction fees. These perks are all useful for travelers.
If you’re strictly a cash-back rewards kind of cardholder, then Chase Freedom is the card for you. It’s difficult to find a card with no annual fee that offers as much as 5% back on certain purchases. And the unlimited 1% back on all purchases is nothing to take for granted either. If you plan your spending accordingly, you have the potential to earn as much as $300 back in cash rewards. Add that to the $150 sign-up bonus and no annual fee, and you’re making money by spending money.
If you’re uncertain whether a travel card or cash-back card is best for you, read Supermoney’s article on the subject.