Chase Points and Cash: Get the Best of Both Worlds
In the past few years, I’ve kept busy earning and redeeming bank points. Chase’s Ultimate Rewards program has been a reliable part of my strategy. I enjoy the variety of earning opportunities and redemption flexibility that the program provides. Chase offers many partner cards (such as Hyatt and United), but we will focus on Ultimate Rewards in this post. If you remember, I have already discussed why I cash out all of my Ultimate Rewards at a penny a piece in the past.
Beyond my strategy, many other excellent opportunities exist to gain outsized travel rewards and cash with Chase Ultimate Rewards. Any cardholder can take advantage of the program for cheaper travel or to save more, perhaps to contribute to a financial independence goal. Let’s take a look at current Chase Ultimate Rewards earning and redemption options followed by my take on Chase points and cash opportunities.
Earning Chase Ultimate Rewards
We can take advantage of Chase’s welcome offers and ongoing spend opportunities to significantly boost our point balances.
Current Welcome Offers and Points Earning
Chase Sapphire Reserve: Earn 50,000 Ultimate Rewards points with $4k spend within the first 3 months of account opening. Earn 3x points on travel and dining, 1x on all other spend. $550 annual fee.
Chase Sapphire Preferred: Earn 60,000 Ultimate Rewards points with $4k spend within the first 3 months of account opening. Earn 2x points on travel and dining, 1x on all other spend. The $95 annual fee is not waived the first year.
Chase Freedom: Earn $200 cash back with $500 spend within the first 3 months of account opening. Earn 5x points on quarterly rotating categories (maximum $1.5k spend per quarter), 1x on all other spend. No annual fee.
Chase Freedom Unlimited: Earn $200 cash back with $500 spend within the first 3 months of account opening. Earn unlimited 1.5x points on all spend. No annual fee.
Chase Ink Business Preferred: Earn 100,000 Ultimate Rewards points with $15k spend within the first 3 months of account opening. Earn 3x points on travel, shipping, internet/cable/phone services, and certain advertising purchases; 1x on all other spend. $95 annual fee.
Chase Ink Business Cash: Earn $500 cash back with $3k spend within the first 3 months of account opening. Earn 5% cash back on the first $25k spend each cardmember year at office supply stores and internet/cable/phone services; 2% cash back on the first $25k spend each cardmember year at restaurants and gas stations; 1% on all other spend. No annual fee.
Chase Ink Business Unlimited: Earn $500 cash back with $3k spend within the first 3 months of account opening. Earn unlimited 1.5x points on all spend. No annual fee.
My Take on Chase Welcome Offers
Chase’s welcome offers are solid across the board for their Ultimate Rewards cards. For those starting out, I recommend the Chase Sapphire Preferred for it’s strong welcome offer, points transfer access to travel partners, 25% Chase travel portal redemption bonus, and reasonable annual fee. Those who value the ability to redeem points at a 50% bonus via Chase’s travel portal and/or heavily spend in the travel and dining categories may wish to consider the Chase Sapphire Reserve instead.
Consider the Chase Freedom as a second card application after obtaining the Sapphire Preferred or Reserve. By holding the Preferred or Reserve, you can easily convert the Freedom’s $200 cash back to 20,000 points. The low $500 minimum spend required for this offer is also excellent!
From my perspective, you should only consider the Chase Freedom Unlimited for a new application if you value points at least 1.33 cents per point, hold the Reserve, or don’t have any interest in the Chase business card offerings. Remember the Chase 5/24 rule! For those of us who value points at less than 1.33 cents per point, you can alternatively do just as well or better spending on a 2% cash back card, such as the Citi Double Cash or Penfed Power Cash Rewards.
Focus on the Chase Ink Business Preferred only if you are able to spend $15k in three months. The Chase Ink Business Cash, my favorite Chase card, earns $500, or 50,000 points for Sapphire Preferred/Reserve or Ink Business Preferred holders with an easy $3k spend in the first three months.
Similar to the Freedom Unlimited, only consider the Ink Business Unlimited for a new application if you value points at least 1.33 cents per point or hold the Reserve.
My Take on Ongoing Spend Opportunities
Let’s go through the easy stuff first.
- Spending in the 3x or 2x travel/dining categories on the Sapphire Reserve or Preferred respectively are no-brainer decisions.
- Obviously, take advantage of the Freedom’s 5% quarterly bonus categories.
Most consumers can easily spend in these categories – the current quarter includes grocery stores as the major earner. Other quarters usually include merchants like gas stations, drug stores, Amazon, department stores, and Paypal. In my opinion, Chase does a great job spreading out merchants across the quarters; we can find efficient ways to spend and earn 5x points in most quarters.
I would only consider the Freedom Unlimited or Business Unlimited for ongoing spend if I had a defined use for the points that works out better than my cash back card alternatives. Everyone’s situation is different, but I do not have a current use for Chase points that exceeds cash back of 3% (Discover it Miles), 2.5% (Amex Blue Business Plus), or even 2% (Citi Double Cash or Penfed Cash Rewards).
The Ink Business Preferred has solid 3x bonus categories for ongoing spend. However, many of us are able to scale the rewards from the Chase Ink Business Cash more lucratively. The Business Cash’s 5% category (office supply stores, streaming, cell phone, cable, internet) on the first $25k spend per cardmember year can be met by many of us. Remember that office supply stores carry a variety of gift cards and run promotions often!
Redeeming Chase Ultimate Rewards
Chase continues to maintain a good stable of travel partners for points transfers:
- Air Partners: Aer Lingus, British Airways, Emirates, Air France/KLM Flying Blue, Iberia, JetBlue, Singapore, Southwest, United, Virgin Atlantic
- Hotel Partners: Hyatt, IHG, Marriott
Also, you can redeem points/cash back directly with Chase via their travel portal. I only recommend this if you are getting outsized value for your points (including the 25% or 50% bonuses) via the portal through the Sapphire Preferred, Reserve, or Ink Business Preferred.
Redeeming for cash couldn’t be simpler with Chase. Simply log into your account and go to the Chase portal to redeem. I do it all the time!
My Take On Redemptions
I’m all about finding the best value for my most near-term redemption needs. Currently, I prefer cash back that I use for our family travel (Disney and non-Disney related). Many of you will find great value through transferring to air and hotel partners. Hyatt, United, and Southwest are popular partners, but any of the others can provide you great travel value based on your travel goals and specific situation.
Let’s talk more about cash. You have probably read about amazing point values others have gotten out of their Ultimate Rewards points. While those outsized redemptions cannot be ignored, do not let them distract you or overly influence your own goals. If you can more immediately use cash back at 1 cent per point than on a trip you may (or may not) take in one or two years with a higher point value, go for the cash! Especially with recent changes where you can get 1.5 cents per point when “cashing” them out. Whether you save the cash or use it on a trip, you have taken more control over the rewards you earned. As many have said before, points aren’t worth anything until you use them.
My Overall Take on Chase Points and Cash
Chase Ultimate Rewards is arguably the most talked about points currency today. There’s no denying the splashy redemptions one can make with the program. In my opinion, though, the best feature of their program is the freedom (groan) Chase gives all of us to sensibly redeem our rewards and toggle between travel and cash rewards. Do you feel like a free night at the Hyatt next week? Go for it! How about cashing in points for an extra $200 in your savings account? Why not?!
Make a point to challenge yourself regarding Chase’s points currency, though. While earning a ton of points is great, you can easily forget to actively redeem. With a bit more focus on the redemption side, you can more actively enjoy rewards that fit your situation best.
Obviously, Chase’s Ultimate Rewards program gives us plenty to talk about. I’ve enjoyed the value I’ve gotten out of the program, whether it was for an outsized-value Disney vacation (when that was an option) or through my current cashout strategy. What Chase spending and redeeming strategies do you use currently?