Back in July, I decided to convert my Chase Sapphire Preferred to the Chase Freedom. This left us with 2 Chase Freedom’s and 2 Chase Ink Cash as our Ultimate Reward earning or cash back earning cards. At the time, I was still on my cash back kick and the fee on the Sapphire Preferred was more than I thought it was worth. After a few months, I think I made a mistake in not keeping a premium Chase card open. How did I try to fix that?
I have a tendency to rotated between cash back and points every couple of months it seems. Usually I focus on points, but there comes a time for me, when earning cash is a better option. Currently, I am back at earning cash back because we have plenty of points between Chase, American Express and Citi. That doesn’t mean I don’t want to earn points I can use as cash or transfer out to partners as well.
The one big draw, when it comes to cash back, Chase has over American Express and Citi, is the ability to cash in your points for 1 cent per point. If you have a premium card, you can move your points to the premium card and transfer to partners, thus making your points worth more. The bad news with Chase is a few months ago is they changed and for people who open many cards, it wasn’t a good change.
Chase New Rule:
If you were to open 5 or more cards from ANY bank in the last 24 months, you would receive a denial from them. There was no way around it, people tried shifting credit limits to make it work, but it seemed nobody had any success.
**It seems this hasn’t gone to their co-branded credit cards, but some people have reported having issues due to Chase’s 5 card rule. Most seem to be fine applying for co-branded credit cards.**
At first, I thought this as just a phase. It seemed like Chase was acting out like a hormonal teenager, just to make a point. Eventually, things would calm down and go back to normal. No, not this time, Chase had become a woman scorned. Hard denial for anyone who opened 5 or more cards in the last 24 months.
My original plan was to open Kristin a Chase Sapphire Preferred, because the first year was waived and it kept the ability to transfer our Ultimate Reward points alive. In the last 24 months, I have opened way more than 5 cards and since I fear rejection from banks, I didn’t even attempt.
I decided to take a look at our spending and which cards we used for which categories, this is how it broke down:
|Groceries||American Express Everyday Preferred|
|Gas||American Express Everyday Preferred|
|Insurance||American Express Everyday Preferred|
|Dining||Citi Premier, or Chase Ink Cash|
|Cell Phone||Chase Ink Cash|
|Internet||Chase Ink Cash|
|Misc Expenses||American Express Everyday Preferred|
**We would use the Chase Freedom and Discover It on 5% rotating categories.**
I already earned 2x on dining with my Ink Cash, so upgrading my Freedom back to Sapphire Preferred would have been poor decision. We use our Citi Premier for all our travel, since it earns 3x. That brought me to my last thought, which at the time made it even tougher to swallow.
Since we have 2 Ink Cash cards, I would upgrade my Ink Cash to the Ink Plus. In doing so, I lost the ability to earn the bonus on that card. Why did this sting?
The bonus was increased to 60,000 points!! On top of that, I would have to pay the $95 fee and not receive any bonus points or statement credit to offset the cost. Realistically, I knew I was not going to be approved for the Ink even with a credit score over 800 and having activity on my Ink cards every month.
Since I decided to upgrade my Ink Cash to an Ink Plus, I still had to decide if it was still worth the fee. The ability to transfer points is great, but still $95 for this card, $49 for that card, it all adds up. We currently have around 80,000 Ultimate Reward points, worth $800 in cash. If I upgraded the Ink, it would become $1,000 when redeeming through Chase Travel. If I were to transfer the points, I feel it is worth around $1440.
Outside of what my current points are worth, we earn roughly 20,000 Ultimate Reward points from Internet and Cell Phone bills per year. That’s worth at least $200 a year minimum. That is the reason I can justify spending the $95 for this card.
I can use those 20,000 points I earn a year for a night at a Hyatt or fly Southwest. If I want to earn more, I can simply use stop by Staples and buy a few gift cards and use my Freedom as much as possible during the 5x categories.
I sent Chase a secure message requesting my Ink Cash be converted to the Ink Plus. I was a little nervous because I didn’t think it was a guarantee I’d be upgraded to the Ink Plus, but after a few messages back and forth, I ultimately was converted to the Ink Plus with no issues. Chase did say they would not expedite the card to me, even though I told them we were traveling internationally soon and I was hoping to have my new card.
With Chase’s new rule, my ability to open new Ultimate Reward cards is currently off the table. I’m not going to wait 2 years in order to earn a sign up bonus from them. There are plenty of sign up bonuses out there and I’m sure Citi or American Express will be more than happy to approve me for more cards.
As changes occur with banks or my reward earning needs, so does my strategy. Eventually, I think Chase will loosen their stance on the 5 card rule, but until they do, I’ll be chugging along with my Ink Cash, Ink Plus and Freedom.
Ever downgrade or close a card, realizing you made a mistake? What’s your strategy with Chase, now that the rules have changed?