Your First Travel Credit Cards (Part 2)

This post is part of the Travel Hacking 101: First Class in 90 Days series. If you haven’t read Your First Travel Credit Cards (Part 1), go and read that post first and then come back here.

Your Second Travel Credit Card

Chase Freedom

freedom_card
Chase Freedom

Annual Fee: $0

Sign Up Bonus: 15,000 points when you spend $500 within the first 3 months. Earn an additional 2,500 when you add an authorized user and make a purchase within the first 3 months.

Category Bonuses: Earn 5 points per dollar on up to $1,500 in combined purchases in bonus categories each quarter, 1 point per dollar on all other purchases.

Transfer Partners: Transfer points at a 1:1 ratio to Air France, British Airways, Korean Airlines, Singapore Airlines, Southwest Airlines, United Airlines, Virgin Atlantic Airways, Hyatt, Marriott, IHG and Ritz-Carlton.

Perks: None

Why this card?

Ultimate Rewards

You want this card for the valuable Ultimate Rewards points it earns. The bonus on this card is marketed as $150 cash back, but the bonus is actually awarded in 15,000 Ultimate Rewards points.  You can get more value out of these points by redeeming them with airlines/hotels, rather than redeeming them for cash.

Small Spending Requirement

To receive the 15,000 point bonus on the Chase Freedom, you only need to spend $500 within the first 3 months of the day you were approved.

The Freedom Transfer Trick

This card works great together with the Sapphire Reserve or Sapphire Preferred. You aren’t able to transfer points from the Chase Freedom directly to the airline/hotel transfer partners listed above. However, because you have either the Sapphire Reserve or the Sapphire Preferred, you can transfer points from the Chase Freedom to those accounts, and then to the partner you choose. It looks like this:

  1. Earn Points on your Chase Freedom
  2. Transfer to your Sapphire Reserve or Sapphire Preferred account
  3. Transfer to the Airline/Hotel Partner of you choice

5 Points Per Dollar Spent in Rotating Bonus Categories

freedom_categories
Freedom Bonus Categories 2017

Every 3 months, Chase reveals a bonus category for the quarter. All spending in that category will earn 5 points per dollar spent. Above were the categories for 2017. You need to login to your Chase Freedom account and manually activate these bonuses each quarter. Make sure to put any spending that falls into the current bonus category on your Chase Freedom card. Five Ultimate Rewards per dollar is a huge value, and you should always maximize it as much as you can. *Chase limits you to 5 points per dollar on up to $1,500 in spending in each bonus category.

Chase 5/24 Rule

You may have noticed that both of the cards I have recommended so far are Chase cards. It’s true there may be better offers out there with other banks, but there is a very good reason for making sure that the first 5 cards you ever apply for are all Chase cards. Chase will deny your application if you have opened five credit cards in the last 24 months from any bank. This is known unofficially as the Chase 5/24 rule. Therefore, you should get the 5 Chase cards you want first, and then move on to cards from other banks. I will layout the next 3 Chase cards I recommend in a future post.

Get ready to apply!

In the next post, I’ll be walking you through your first travel card applications. Before you can apply, you’ll need to complete the action items below.

Your “action items” for this post are:

  1. Add up how much money you spend each month that can be put on credit cards. Have this number handy for the next post. You should be putting all your spending on your credit cards as long as it doesn’t incur additional fees. Things like your rent or mortgage usually incur too many fees when paying with a credit card. **NEVER spend more than you normally would just to earn points.**NEVER carry credit card debt.
  2. If you already have any other credit cards, write down how many of these were opened in the last 24 months. You can get this info from CreditKarma if you aren’t sure.

 

Editorial Disclaimer: All written content on this site is for information purposes only. Opinions expressed herein are solely of the author, unless otherwise specifically cited. All information or ideas provided should be discussed in detail with an advisor, accountant or legal counsel prior to implementation. Neither the editorial content nor the comments on this site are provided by the companies whose products are featured. Any opinions, analyses, reviews or evaluations provided here are those of the author’s alone.

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