Chase Freedom Card Turns into Discover

Update: read some continued commentary on this topic here.

chase-discover meld Since 2007 the Chase Freedom card has been one of my most oft-used credit cards. I like it because it gives me 3% cashback at grocery stores, gas stations, and quick service restaurants, like fast food, pizza places, and coffee houses. It was even part of my credit card usage plan for maximum rewards.

I say “was” because yesterday I received a letter in the mail from Chase. The outside of the envelope loudly boasted about upcoming improvements to the Freedom card. Uh oh. When a credit card company talks of improvements, they usually just mean for them, not for you.

And what are the supposed improvements?

Straight from the horse’s mouth, with my commentary below:

  • Earn 1% cash back every day, everywhere, on all purchases with no caps or expiration dates.

Okay, that’s exactly the same as before. No change yet.

  • The triple cash back rewards you earn on gas, grocery store and fast food purchases will no longer be available. However, there will be opportunities to earn 3% cash back in new spending categories throughout the year.

No longer available? How is that an improvement? Oh, right, they’re replacing it with rotating spending categories. I think another company already does that, but with a 5% cashback rewards program. So, Chase Freedom is imitating Discover, but sucking at it?

Hmm, this sounds familiar as well. Once again, Chase Freedom is a lesser variation of ShopDiscover, which yields up to 20% cashback. Just for the record, the Chase Rewards Plus shopping portal is not new – it existed long before this letter arrived touting it as an improvement.

  • Pay Yourself Back – by making a purchase with your Chase Freedom credit card and redeeming it for a credit to your account.

Well, at least this feature is new. Nope, this isn’t new, either. Thanks, Kim!

  • Continue to redeem for checks, which now start at $50. Note: The $50 bonus when redeeming $200 in Cash Back Rewards will no longer be available after June 30th.

AARGH! That was one of the main benefits of the Freedom card! If you saved up to $200 in cashback rewards, you could redeem it for a $250 check, therefore effectively yielding 3.75% / 1.25% cashback. Chase, please tell me how removing this extra bonus is an improvement.

By the way, the reward checks always started at $50. No change there, either.

  • Get more of your favorite gift cards from Starbucks Coffee, Target, iTunes, and Marriott – starting at just $25.

Okay? I’m still reeling from the loss of the $50 bonus.

  • On or about June 30, 2009, your account will be automatically updated with the benefits listed above. You’ll receive a Welcome Kit explaining all your new rewards – and other benefits such as Purchase Protection – in greater detail.

Chase, you make me laugh. Benefits? Congratulations on being masters of spin. How hard did your employees laugh when creating and sending these letters? Did you think we (the customers) wouldn’t notice?

Allow me to sum up the situation for you: Chase is desperate to save cash however they can, so not only did they slaughter the WaMu savings account rates when they took over, they’re now effectively killing the Freedom card. I can’t think of how a single cited improvement benefits the consumer rather than Chase itself, at least compared to how the program previously worked.

All-in-all, the major modifications effectively turn the once-mighty Chase Freedom card into a wimpy version of the Discover card. I’m very close to the $200 reward threshold, so it looks like I must use the Freedom card exclusively for now so that I can grab my $250 bonus check before it disappears.

After that, it looks like my Freedom card is destined for the sock drawer.

Here’s a scan of the letter I received.


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8 thoughts on “Chase Freedom Card Turns into Discover

  1. I got the same letter yesterday and was equally annoyed! The $250 reward won’t be available after June 30. I’m so close right now, but I’m going to miss it by a few dollars

    Pay Yourself Back isn’t new either. I noticed that at least a few months ago.

    I’m definitely switching cards!

  2. I am a longtime Chase customer (and employee) and a freind of mine told me last night about the changes you described, but I never received a letter. So, I just finished calling the number on the back of my Freedom card and the rep said that my card was under the program “Chase Freedom Exclusive for Checking” because I also have a Chase checking account. This category of the program carries enhanced benefits. Here is the copy and paste from my online profile:

    “As an active Chase Checking customer, you get exclusive benefits!
    MORE REWARDS. Chase Freedom gives you 3% cash back on your top 3 Everyday categories. As an active Chase Checking Customer, you’ll earn 3% cash back on your top 5 Everyday categories – a Chase Checking account lets you earn in 2 extra Everyday categories!
    NO EXPIRATION. Rewards don’t expire when you have an active Chase Checking account, so save up and redeem when you’re ready.
    REWARDS QUICKER. You can redeem at the standard $50 level, or as an active Chase Checking Customer redeem $10 in rewards for a $10 check!”

    The card rep did confirm that some Freedom reward programs have changed, but not “Chase Freedom exclusive for Checking.” Before you switch, you may want to consider opening a Chase checking account and keeping the current rewards program.

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  4. There is no Chase branch or ATM for 100 miles from where I live and even with the Chase Checking account, it doesn’t sound like you get that extra $50 bonus at the $200 mark. I am pissed. I never got this letter, but I went to cash in my rewards today only to find my max to cash in is $175. This new Saphire card is going in my sock drawer too (although I would like to shove it somewhere else).

  5. I also received this letter, but then in June 2009 or so (prior to the scheduled change), I received another letter saying that there would be no changes to my account. I still have the $50 bonus for $200 redemption and I still have 3X points in my top 3 categories. I’m not sure why my old terms were kept. This is not my primary card and I pay in full each month. I received a 20,000 point bonus to open the card about 2 years ago. (It pays to get junk mail, sometimes). I have 2 other Chase credit cards so who knows what criteria was used in my situation.

    Thanks for the tips on the Chase Exclusive Checking/Freedom link. Does this program offer the $50 bonus for a $200 redemption? There was no info on this. I’m not leaving my credit union (since all ATM surcharges are refunded), but if I had a Chase checking account, I would consider linking the two.

    Keep in mind that Discover’s quarterly rotating 5% bonuses are capped from $200 to $400 in spending so the max you’ll earn is $10 to $20. Still nice, but $400 in groceries is less than one month for my household.

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  7. Well, it finally happened. Today I got the notice that my Chase Freedom Card was now changing to the crappy rotating category program effective November 30, 2010. Good thing I just cashed my $250 check since it’s the last one I’ll get.

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