topic Re: CF vs CFU, the internal conundrum. in Credit Cards

CF vs CFU, the internal conundrum.

Anonymous — Fri, 07 Jan 2022 06:31:13 GMT

Hi forums. *waves* This is my first post here so be gentle, please I hope this is in the right place but if not please let me know.

I'm trying to work out a situation I've got by talking it out loud and maybe some of you have things for me to think about I haven't thought of. As of a month ago (12/6, so a literal month) I applied for and was accepted for my second ever credit card, the CFF. Yay! (If it matters to the discussion at all I've banked with Chase for years.) I love the 3X on restaurants/takeout and especially the 5X on groceries for the year. For fifteen years my only card was the regular Chase Freedom that is a standard-base 1X on all purchases. Never utilized the rotating categories (honestly I never even noticed them) and only in reading through this community and others in the last month or two did I realize what all I'd been missing out on all of this time. That's on me.

Which brings me to - surely, after fifteen years, I can do better as a base standard. My scores are in the above-750 range according to Experian (no late payments ever, all good stuff, but only the one credit card, no loans or anything. Apparently that is a negative mark that I only had one card until now?) and I was immediately approved for the CFF when I applied for it. I've learned from research that product changes are a thing and now I'm thinking about changing my Freedom to a Freedom Unlimited (1X - 1.5X). I'm indecisive and can't make decisions in regular life, so I wrote out a few pros and cons, and I thought I'd come here to hear what you all nice people have to say. Any and all advice is welcome!

At this point in my life I don't put much on my card that isn't covered by the CFF grocery (5X) or dining (3X) bonuses, aside from maybe holiday shopping and assorted other purchases that don't happen regularly. I know, math-wise, there isn't much difference between 1X and 1.5X. Maybe it's just knowing that I'm getting some sort of bonus, lol; probably I noticed it now because I did some semi-expensive holiday shopping and I'd like to be able to look and see that I got something out of it more than the basic standard From what I've read a product change keeps the same credit line, account history and whatnot. That's important to me: the Freedom is my first and ovbiously oldest card at fifteen-plus years, as I said. I need to keep my account history.

CFF/CF both have rotating categories while the CFU doesn't; at this time I don't spend 3K in a quarter on any category to justify needing two cards that have the same 'bonus' function. (I haven't used the categories until now but I can't see myself ever spending 3K on a single category in three months. Maybe I will in the future when/if I move out to live on my own, but not right now.) Product-changing to the CFU takes me out of the running for the sign-up bonus, yes? That stings a little.

Another option I've heard about is to keep my Freedom open and open a new card, the CFU, to bring my total to three cards, but that would require an inquiry that would show up on my report. (I'm thinking about opening a Discover card next year, that's another topic for another post.) I'd be able to move credit limits around to make that happen, but as I'm only one month into the CFF 5X-on-groceries I don't want to waste the CFU bonus on the same thing if I wouldn't be able to maximize it to its potential. Y'know? And I doubt putting the CFU grocery bonus on layaway for a year is a thing Chase or any bank would do. LOL!

Or... I can wait for the Freedom to be automatically product changed to a new card, something I've heard will happen because Freedoms aren't allowed anymore to new customers, and bypass this little problem entirely.

If you've gotten this far making sense of all of this, thank goodness! As you can no doubt tell by the gap in time from my first card when I was eighteen to this CFF, I'm very new to the credit card game and am trying to do the best I can. I'm trying to work this out in my head what's the best road to take. What say you, FICO forums?

Re: CF vs CFU, the internal conundrum.

NoHardLimits — Fri, 07 Jan 2022 07:20:46 GMT

Welcome Fancy_Like!

I have both the Freedom Unlimited and the non-flex Freedom with the 5% rotating categories. Each of those accounts started life as a different type of card and have gone through a number of product changes. Product changes with Chase do retain the card's previous history. Both CF and CFU can be useful in the right situation, though in my case I keep them open mainly due to their positive contributions to my FICO score. One is my oldest card and both have fairly large credit limits.

You've done a good job in identifying your various options. If I were in your situation, I would definitely want to maintain that 15 year old account in some fashion. The easiest thing to do would be to product change to CFU since you already have CFF. There is really no need to have standard Freedom and a Freedom Flex at the same time unless you anticipate spending significantly more than $1500 in a quarter in the rotating categories. Yes, you are correct that a product change to CFU would make you ineligible for the signup bonus.

If you want to add a third card, I would pursue a different lender so that you don't have all your eggs in one basket. Figure out your main spending categories and research cards which give the greatest rewards for those transactions. If you tell us your top spending categories, the forum members would be happy to point you towards some alternatives.

Re: CF vs CFU, the internal conundrum.

Anonymous — Fri, 07 Jan 2022 07:36:20 GMT

@Anonymous wrote:
Hi forums. *waves* This is my first post here so be gentle, please I hope this is in the right place but if not please let me know.

I'm trying to work out a situation I've got by talking it out loud and maybe some of you have things for me to think about I haven't thought of. As of a month ago (12/6, so a literal month) I applied for and was accepted for my second ever credit card, the CFF. Yay! (If it matters to the discussion at all I've banked with Chase for years.) I love the 3X on restaurants/takeout and especially the 5X on groceries for the year. For fifteen years my only card was the regular Chase Freedom that is a standard-base 1X on all purchases. Never utilized the rotating categories (honestly I never even noticed them) and only in reading through this community and others in the last month or two did I realize what all I'd been missing out on all of this time. That's on me.

Which brings me to - surely, after fifteen years, I can do better as a base standard. My scores are in the above-750 range according to Experian (no late payments ever, all good stuff, but only the one credit card, no loans or anything. Apparently that is a negative mark that I only had one card until now?) and I was immediately approved for the CFF when I applied for it. I've learned from research that product changes are a thing and now I'm thinking about changing my Freedom to a Freedom Unlimited (1X - 1.5X). I'm indecisive and can't make decisions in regular life, so I wrote out a few pros and cons, and I thought I'd come here to hear what you all nice people have to say. Any and all advice is welcome!

At this point in my life I don't put much on my card that isn't covered by the CFF grocery (5X) or dining (3X) bonuses, aside from maybe holiday shopping and assorted other purchases that don't happen regularly. I know, math-wise, there isn't much difference between 1X and 1.5X. Maybe it's just knowing that I'm getting some sort of bonus, lol; probably I noticed it now because I did some semi-expensive holiday shopping and I'd like to be able to look and see that I got something out of it more than the basic standard From what I've read a product change keeps the same credit line, account history and whatnot. That's important to me: the Freedom is my first and ovbiously oldest card at fifteen-plus years, as I said. I need to keep my account history.

CFF/CF both have rotating categories while the CFU doesn't; at this time I don't spend 3K in a quarter on any category to justify needing two cards that have the same 'bonus' function. (I haven't used the categories until now but I can't see myself ever spending 3K on a single category in three months. Maybe I will in the future when/if I move out to live on my own, but not right now.) Product-changing to the CFU takes me out of the running for the sign-up bonus, yes? That stings a little.

Another option I've heard about is to keep my Freedom open and open a new card, the CFU, to bring my total to three cards, but that would require an inquiry that would show up on my report. (I'm thinking about opening a Discover card next year, that's another topic for another post.) I'd be able to move credit limits around to make that happen, but as I'm only one month into the CFF 5X-on-groceries I don't want to waste the CFU bonus on the same thing if I wouldn't be able to maximize it to its potential. Y'know? And I doubt putting the CFU grocery bonus on layaway for a year is a thing Chase or any bank would do. LOL!

Or... I can wait for the Freedom to be automatically product changed to a new card, something I've heard will happen because Freedoms aren't allowed anymore to new customers, and bypass this little problem entirely.

If you've gotten this far making sense of all of this, thank goodness! As you can no doubt tell by the gap in time from my first card when I was eighteen to this CFF, I'm very new to the credit card game and am trying to do the best I can. I'm trying to work this out in my head what's the best road to take. What say you, FICO forums?

Welcome to the forum.

What are your yearly spends in each category?

Try running a spending report on the Chase website and then report back with your 2021 spends in each category. If you don't feel comfortable listing this info on this forum, you can do it yourself offline. In my opinion, it's simply a math problem. Run the numbers against the scenarios you're considering (product change now, add CFU as new card now, add CFU as new card once your year of bonus expires on CFF). Include the sign up bonus in your calculations. This will help put this into perspective and should help with your decision process. If I were in your shoes, I would probably product change the CF to the CFU now but it'll help to understand how much opportunity cost you'd be missing out on by doing it so. Managing three cards requires more effort than two cards. Is the extra money you'd receive from having three cards worth effort to you?

Re: CF vs CFU, the internal conundrum.

Hoben02 — Fri, 07 Jan 2022 10:53:52 GMT

My question is do you have a chase sapphire card my reason for owning those cards is the ability to transfer them to chase ur points to get full value. Alone as just cashback cards you can do better. Looks like you have thought this thru I would go with a product change of the cf to a cfu my only reason for having the original cf is the ability to access Costco when it comes up as a 5x category

Re: CF vs CFU, the internal conundrum.

EAJuggalo — Fri, 07 Jan 2022 11:14:40 GMT

Since you already have a CFF, I would PC the CF to the CFU. You would lose the opportunity for the SUB but keeping that history would be worth it. Where those two cards really shine on the rewards front is if you pair them with a CSP or CSR. I would also highly recommend getting a card from a different lender, just for variety. Also having at least three cards is optimal for FICO scoring.

Re: CF vs CFU, the internal conundrum.

Lou-natic — Fri, 07 Jan 2022 11:44:02 GMT

@EAJuggalo wrote:
-Snip-
Also having at least three cards is optimal for FICO scoring.

Just want to highlight this, your scores will dip just a wee bit for apping for another 2 cards but will quickly recover and go even higher afterward.

Re: CF vs CFU, the internal conundrum.

Anonymous — Fri, 07 Jan 2022 19:23:48 GMT

When my new CFF card hit my reports a month after being approved, @Lou-natic, my score dropped 25 points! LOL! I was concerned about it but was told it was mostly because I only had the one other card that my average age of accounts was affected so drastically. True? Can anyone else chime in to the validity of that and when/how my score will increase back?

Re: CF vs CFU, the internal conundrum.

simplynoir — Fri, 07 Jan 2022 19:28:48 GMT

@Anonymous wrote:
When my new CFF card hit my reports a month after being approved, @Lou-natic, my score dropped 25 points! LOL! I was concerned about it but was told it was mostly because I only had the one other card that my average age of accounts was affected so drastically. True? Can anyone else chime in to the validity of that and when/how my score will increase back?

Yes, a new account hit with affect AAoA since there are no number of cards on your report to offset the scoring hit. Fortunately with some modest aging of 6-12 months you should see your scores recover, that goes along with the aging of the HPs you took as well applying for the CFF in the same time frame as well

Re: CF vs CFU, the internal conundrum.

EAJuggalo — Fri, 07 Jan 2022 19:48:19 GMT

@Anonymous wrote:
When my new CFF card hit my reports a month after being approved, @Lou-natic, my score dropped 25 points! LOL! I was concerned about it but was told it was mostly because I only had the one other card that my average age of accounts was affected so drastically. True? Can anyone else chime in to the validity of that and when/how my score will increase back?

What you were told is mostly right. It's the combination of your Average Age of Accounts being cut in half and the Age of Youngest Acount being reset to 0. Your score will come back and probably increase in a year. Since you already took the hit for the new account I would look at getting one or two more right now when the ding won't be nearly as bad.

Re: CF vs CFU, the internal conundrum.

MrDisco99 — Fri, 07 Jan 2022 23:03:37 GMT

If you PC to the CFU do you keep the bonux 5x on groceries? If not I'd stay put until the year is up on that so you don't lose it.

If it were me I'd apply for another card to complement the category earning on the CFF... something that earns a flat 2% on everything like the Citi DoubleCash or PayPal or something like that.

Re: CF vs CFU, the internal conundrum.

NRB525 — Sat, 08 Jan 2022 00:18:04 GMT

@MrDisco99 wrote:
If you PC to the CFU do you keep the bonux 5x on groceries? If not I'd stay put until the year is up on that so you don't lose it.

If it were me I'd apply for another card to complement the category earning on the CFF... something that earns a flat 2% on everything like the Citi DoubleCash or PayPal or something like that.

If I read correctly, OP has the Freedom OG as the well-aged card, and the new card is Freedom Flex, where the grocery bonus lives. PC of Freedom OG to Freedom Unlimited won't affect the Flex bonus.

OP, I had a Chase Slate card. Appropriate name because with zero rewards that card was dumb as a rock. The card was opened in 2003, long aged. PC'd to the Freedom Unlimited, because in the UR points environment, the 1.5 UR is very nice on non-categories spend. I also have an aged Freedom OG, and have been using the categories for years. Just got the Flex recently so now I'm emphasizing UR points and enjoying the groceries bonus.

While it may be possible the CFU has a grocery bonus in a year ( the current promo ending soon ) I would suggest your next move, a year or so from now, should be a Chase Sapphire Preferred app. This gets you an outright sign up bonus of a lot of UR points for $3k to $4k spend, and if you keep the UR you are earning this year, you end up with a ton of nice UR points to fund travel at a better rate than 1cent per point. So my suggestion is to do the PC from the Freedom OG to Unlimited.

Re: CF vs CFU, the internal conundrum.

Anonymous — Sat, 08 Jan 2022 01:15:14 GMT

@NRB525 I haven't figured out how to quote you, but yes, my first/oldest card is the OG Freedom and the CFF is the newbie. I do have another question, though. You aren't the only one I've heard talk about the CSP and/or the CSR and the respective 1.25/1.5X multipliers. Are the multipliers only for travel, or if you have that card can you redeem your UR points for straight cash-back at those higher rates?

@NoHardLimits and @EAJuggalo, you suggested a third card with a different, non-Chase lender. Is there a specific reasoning for that? I probably wouldn't be getting a third card until next year (baby steps and all) but I've looked at/considered Discover IT. 5X rotating categories like the CFF and the first year doubles the cash back which makes it a 10X/flat-2X card. I've also read that normally the Chase/Discover quarterly categories don't overlap.

Re: CF vs CFU, the internal conundrum.

EAJuggalo — Sat, 08 Jan 2022 01:58:15 GMT

@Anonymous wrote:
@NoHardLimits and @EAJuggalo, you suggested a third card with a different, non-Chase lender. Is there a specific reasoning for that? I probably wouldn't be getting a third card until next year (baby steps and all) but I've looked at/considered Discover IT. 5X rotating categories like the CFF and the first year doubles the cash back which makes it a 10X/flat-2X card. I've also read that normally the Chase/Discover quarterly categories don't overlap.

A third card helps with scoring, a non-Chase lender is purely for risk mitigation purposes. If your relationship goes bad with Chase, if Chase's computers go down, or a something else happens. You still have another option. IME, Discover and Freedom categories overlap one quarter every year.

Re: CF vs CFU, the internal conundrum.

NoHardLimits — Sat, 08 Jan 2022 02:12:03 GMT

@EAJuggalo wrote:
@Anonymous wrote:
@NoHardLimits and @EAJuggalo, you suggested a third card with a different, non-Chase lender. Is there a specific reasoning for that? I probably wouldn't be getting a third card until next year (baby steps and all) but I've looked at/considered Discover IT. 5X rotating categories like the CFF and the first year doubles the cash back which makes it a 10X/flat-2X card. I've also read that normally the Chase/Discover quarterly categories don't overlap.
A third card helps with scoring, a non-Chase lender is purely for risk mitigation purposes. If your relationship goes bad with Chase, if Chase's computers go down, or a something else happens. You still have another option. IME, Discover and Freedom categories overlap one quarter every year.

Yes, I also agree that having a non-Chase card is to remove the risk of losing access to all of your credit cards simultaneously if something goes wrong with Chase.

Many years ago, Freedom gave 3% cash back in your top 3 spending categories every month. When it changed to 5% rotating quarterly categories, Chase almost completely duplicated Discover's calendar. As time went by, the categories diverged so there is no longer too much overlap.

Re: CF vs CFU, the internal conundrum.

Aim_High — Sat, 08 Jan 2022 02:27:46 GMT

@Anonymous wrote:
@NRB525 I haven't figured out how to quote you, but yes, my first/oldest card is the OG Freedom and the CFF is the newbie. I do have another question, though. You aren't the only one I've heard talk about the CSP and/or the CSR and the respective 1.25/1.5X multipliers. Are the multipliers only for travel, or if you have that card can you redeem your UR points for straight cash-back at those higher rates?

@NoHardLimits and @EAJuggalo, you suggested a third card with a different, non-Chase lender. Is there a specific reasoning for that? I probably wouldn't be getting a third card until next year (baby steps and all) but I've looked at/considered Discover IT. 5X rotating categories like the CFF and the first year doubles the cash back which makes it a 10X/flat-2X card. I've also read that normally the Chase/Discover quarterly categories don't overlap.

Welcome to My Fico Forums, @Anonymous!

I agree with the general consensus that product-changing your original Freedom to the Freedom Unlimited is your best choice at this time.

To quote another member (as I did above with you), type the "@" sign. A dialogue box will open that shows some recent members who have posted in that thread. If you don't see the name (or want to reference a member who isn't participating in that thread), just start typing the user name and suggestions will come. Using the "@" or quoting the specific message you're replying to is important since replies to one specific comment can get lost in the exchange in the thread.

Do you travel much or at all? You mentioned that you would be "moving out to live on your own" so it sounds like your living situation might not include a lot of travel. If you don't travel, you don't need a Sapphire Preferred or a Sapphire Reserve. If you do travel, those are both great cards! No, the Sapphire cards don't magnify the value of your cash-back unless you either use it for travel in the portal (1.25x on CSP or 1.5x on CSR), or unless you transfer it to partners where it can be worth up to 2x the value.

It's wise to diversify your cards among different lenders for many reasons. By far, the biggest reason is that not diversifying gives one single lender way too much power over your credit score and file. If something happened to raise their concerns about the lending relationship, they could decrease your limits or even close all your cards. Ideally, three cards is the minimum you want for building a solid credit score and if you have a choice, I would pick three different lenders where your relative risk with each one is only 33%. If you become like some of us on the forums who have a half dozen or a dozen or more cards, the effects of an incident with one lender would be minimal. Also, as mentioned, having backups for spending if there is a network problem with that bank's cards. If you'd like some suggestions about what other cards or lenders to pursue, let us know what you're looking for and we'd be glad to help.

Re: CF vs CFU, the internal conundrum.

Anonymous — Sat, 08 Jan 2022 02:50:07 GMT

@Aim_High thank you for the offer In a few months/towards the end of 2023 when I anticipate wanting to open a third card I will definitely come back here for advice. The majority of my spend at the moment is groceries/dining/fast food and I have that covered with the CFF and the first-year grocery bonus. If I product-change to the CFU that will cover (the majority) of the rest. I think those two cards will do me for awhile until I feel confident enough to spread my wings even more. I don't travel at the moment so I don't think the CSP/CSR are for me, at least not right now.

Is there a specialized forum section for new card advice or is this section fine for that sort of thing?

Considering the OG Freedom is no longer allowed to new users and there are data points of people with that card being auto-converted to the CFU/CFF, do you anticipate that happening to everyone with the Freedom (OG)?

Re: CF vs CFU, the internal conundrum.

Aim_High — Sat, 08 Jan 2022 03:17:55 GMT

@Anonymous wrote:
@Aim_High thank you for the offer In a few months/towards the end of 2023 when I anticipate wanting to open a third card I will definitely come back here for advice. The majority of my spend at the moment is groceries/dining/fast food and I have that covered with the CFF and the first-year grocery bonus. If I product-change to the CFU that will cover (the majority) of the rest. I think those two cards will do me for awhile until I feel confident enough to spread my wings even more. I don't travel at the moment so I don't think the CSP/CSR are for me, at least not right now.

Is there a specialized forum section for new card advice or is this section fine for that sort of thing?

Considering the OG Freedom is no longer allowed to new users and there are data points of people with that card being auto-converted to the CFU/CFF, do you anticipate that happening to everyone with the Freedom (OG)?

It sounds like those two cards should serve you well for the near-term, @Anonymous. No need to rush an additional card.

For questions on applying for new cards, the best choice would probably be the sister forum of this one called "Credit Card Applications." (Link provided.) But this forum might work as well.

I have the original Freedom card and it's survived the changes to Freedom Flex. I may be wrong but I don't remember any involuntary product-changes from original Freedom to other products. Sure, that is possible and lenders have sometimes forced cardholders into new products. That recently happened, for example, on the Barclay's UBER card program being terminated with cardholders converted into the VIEW card. And with some recent bank mergers and acquisitions, some of our members have had cards converted into other products involuntarily such as when BBVA-USA was spun off by BBVA to PNC Bank.

Regardless, with your not anticipating a need for multiple 5% rotating category Freedom cards, getting that extra 0.5% on uncategorized spending by converting your OG Freedom to Freedom Unlimited seems to be a much smarter bet.