Is it that time again, time for a new card? If you have been holding off on signing up for a Chase credit card, now would be a very good time to move forward.
Chase stepped up the offer on two of their most popular cards, the Freedom and Sapphire.
The Chase Freedom card is a cash back card that allows you to earn additional cash back during quarterly bonus periods. This is a great beginner card to get you into the “points” game.
The Chase Sapphire card is a travel card with a large sign up bonus and many travel perks. This card earns you ‘Ultimate Rewards’ which can be used to book travel through Chase or they can be transferred to other partners like Southwest, United, Marriott, and Hyatt. The points transfer instantly at a 1:1 ratio, with no fees!
-The low-down on the Freedom card:
This card earns you $150 in cash upon spending only $500 within 90 days. If you add an authorized user (more on that below), you will earn an additional $25. The quarterly bonus right now is on spending at Amazon.com. You will earn 5% back on all purchases through Amazon.com, up to $75, until December 31st. Spend $1,500 on Amazon, you will get $75 back, pretty simple. This card has NO ANNUAL FEE ever. Applicants will generally want a credit score of 650 or higher for this card. **Keep in mind, if you have signed up for another credit card within the last 90 days you will want to wait to sign up for this card. Chase likes to see 90 days since your last credit application (credit pull/new account)
-The low-down on the Sapphire card:
First off, this card requires a good credit score, usually 700 or higher. This card earns you 50,000 Ultimate Rewards points upon spending $4,000 within 90 days. If you add an authorized user you will earn an additional 5,000 UR points. Keep in mind you will earn 1 point per dollar spent meaning your $4,000 minimum spend will net you another 4,000 UR points. Grand total, 59,000 Ultimate Rewards points, if you add an authorized user. The annual fee is waived for the first year and you are welcome to cancel at anytime to avoid the second year fee of $95.
What is the best use of 59,000 Ultimate Rewards points?
This depends on the type of travel you want to do, but transferring the points to Southwest Airlines would be a good start. 59,000 Southwest points would net you about $800 worth of flights. You can transfer to the travel partners in 1,000 point increments. Another good transfer option would be to Hyatt Hotels. Free hotel nights begin at 5,000 points for a night at a basic property. This means you could get close to 12 free nights at a Hyatt hotel if maximized correctly. You would be just 1,000 points shy of redeeming 5 free nights at the Hyatt Place Waikiki Beach, which costs 12,000 points per night. With the same 12,000 points per night, you could also stay at the Hyatt Regency in Fort Lauderdale.
Okay, the points look nice, how am I going to spend $4,000 in 90 days?
This is a big scare that many people have. First of all, you can add an authorized user who will share your line of credit/account and get their own copy of the credit card. This means that two people can work on the minimum spend. Additionally, you can use the service, plastiq.com, to pay any bill using a credit card. For example, you could pay your rent online for a 2.5% fee, Plastiq will then mail a check to your landlord on your behalf and your credit card will show a “purchase” to Plastiq (plus the 2.5%), helping to meet your minimum spend. Don’t forget we are in the holiday season, you can always offer to purchase a big ticket item for a friend of family member and then just have them pay you back with cash or check.
How do authorized users work?
Believe it or not, you can have a secondary account user on your credit cards, called an “authorized user” (AU). This secondary person shares your existing credit line and account but does get their own copy of the credit card. An AU does not have his or her credit checked when you add them, however, the credit card company will ask for their SSN to make sure they are not on their “black list” and to report, good or bad, the standing of the account to the credit bureaus. Authorized users are a great way for parents to ease their teenagers into the often overwhelming world of ‘credit’. This WILL help build the credit of the AU, and the best part is that the AU does not need to have any previous credit history to be added onto the account. This method will also allow the parent to manage and monitor the account because they would be the primary card holder, thus seeing all transactions completed by themselves as well as the AU. You can, at anytime, suspend the secondary card since you are responsible for all spending on the account.