The Chase Freedom family of cards: it's (still) all about quantity

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In a case of impeccable timing, at the beginning of this week I was high in the Blue Ridge Mountains of Shenandoah National Park, far from cell service, and so was barely aware of Chase’s announcement of a shakeup of their Freedom credit card lineup until we returned to sea level. This gave me the great fortune of being able to read what everybody else thought before weighing in myself.

The new Chase Freedom lineup

Just so we’re all on the same page, this is what the Chase Freedom credit card lineup will look like after September 15, 2020:

None of the cards has an annual fee, and all earn non-flexible Ultimate Rewards points, which require an annual-fee card (Sapphire Preferred or Reserve, or Ink Bold, Plus, or Preferred) to transfer to travel partners.

Load up on Freedom cards now

Looking at the table above, it’s obvious that the Freedom Flex is strictly superior to the Freedom card: there exist categories where it has a higher earning rate, and no categories where it has a lower earning rate. That’s the very definition of strict superiority: there are no tradeoffs.

And that’s why you should get as many Freedom cards as possible right now, before the card is closed to new applications and, presumably, product changes on September 14.

Since each Freedom (and soon, Freedom Flex) card has its own $1,500 limit on quarterly bonus spend, the best strategy has always been to have as many as possible through product changes. Applying for Chase Slate cards for their $0 balance transfer fees and 0% introductory APR offers and Chase Sapphire Preferred and Reserve cards for their signup bonuses, then requesting a product change to the Freedom, is a popular strategy for accumulating additional Freedom cards and additional bonused spending capacity.

So if you still have any Slate or Sapphire cards you’re been procrastinating on, this is a wake-up call to request your product change as soon as possible.

Nick at Frequent Miler suggests that product changes to the Freedom Flex will be possible despite the fact that the Freedom Flex will be issued as a MasterCard World Elite card and Chase’s existing cards are issued as Visas. If this is true, then you can call in again and request the change once the Freedom Flex goes live. If it turns out not to be the case, waiting in hopes of requesting a product change to the Freedom Flex may leave you trapped in inferior products going forward.

Freedom Flex for new applicants

Moreover, the Freedom Flex is a card that you will want to apply for from scratch, partly because of its $200 (20,000 Ultimate Rewards point) signup bonus, but mainly because of the ability to earn 60,000 Ultimate Rewards points when you spend $12,000 at grocery stores during the first year.

Since the Freedom Flex’s bonused earning on dining and drugstores is unlimited, there’s no reason to carry more than one of the card or prefer it to the Freedom (assuming the cards will share quarterly bonus categories). In that sense, it’s like the Freedom Unlimited: you want to have one, but there’s no particular reason to want more than one.

Conclusion

That’s the strategy I’ll be pursuing: convert my remaining Chase personal credit cards to Freedom cards, which will leave me with a total of 4, then apply for a new Freedom Flex card when the application goes live. Whether that’s the right strategy for you depends on how far above Chase’s limit of 5 total credit card applications in the previous 24 months you are, and whether you ever intend to fall below it.

If you’re so far above “5/24,” or credit card signup bonuses are so essential to your travel hacking strategy, that you decide that the only way you’ll ever get a Freedom Flex is through a product change, I would still recommend not product changing from a Freedom, since those will soon be irreplaceable. Far better to sacrifice a Freedom Unlimited or Sapphire card, as long as you maintain as least one premium Ultimate Rewards card to maintain the flexibility of your points.

Final status report on my personal finance application cycle

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Last June I wrote about my personal finance application cycle, in which I applied for a Chase Slate and Citi Double Cash credit card in order to run up high balances and use the resulting negative-interest-rate loans to finance other projects. Since my 0% APR introductory periods are coming to an end, I thought readers might enjoy a final update.

Did it work?

My strategy worked perfectly, as it had to.

Fees and interest rates, unlike other terms and conditions of credit card agreements, are heavily regulated and cannot be changed by the banks to retroactively apply to existing balances (as long as you stay current on payments). In fact, even if my Chase and Citi accounts had been closed for some reason, I still would have been entitled to continue making only the minimum payments on the two cards until the introductory interest rate period elapsed.

I had no trouble moving my existing Chase credit lines to my new Slate card, as I explained in the original post, and was able to transfer $15,000 in balances to the card at the promotional 0% APR. I also didn't have any problem manufacturing my $5,200 credit limit on the Citi Double Cash, maximizing the amount of cash I was able to borrow at a negative interest rate.

What happened to my credit score?

When reading about this tactic, many of my readers grow agitated about the horrific damage that must have been wreaked on my credit score by nearly maxing out two credit cards on an ongoing basis.

In the 12 months of FICO score history Barclaycard provides, my score has bounced around between 677 and 729. In the last 6 months, Citi has me between 667 and 683. And in the last 12 months American Express has my FICO score between 670 and 720.

But I don't care about my FICO score, and the "damage" didn't keep me from being approved for a new Chase Hyatt credit card.

As should be obvious, everyone's situation is different: if you have just a few cards, or a short credit history, then high utilization on one or more cards might do significant damage to your credit score, potentially keeping you from getting approved for the credit cards you want.

If you have a lot of cards, and a long credit history, it's more likely to have only a nominal effect on your score, as it did on mine.

What did I do with the money?

Not much! I funded my Consumers Credit Union Free Rewards Checking account with $10,000, and used the rest of my newfound cash flow to increase the speed and convenience with which I manufactured spend on my other credit cards. Even if you diligently pay off each of your credit cards with the same spend manufactured with that card, there are still inevitable delays connected with depositing funds and making payments. Having a substantial amount of cash on hand smooths out those inconvenient delays and increases my overall return.

What's next?

This month I paid off the balance on my Citi Double Cash, and have already started using the card to manufacture unbonused spend. It's a somewhat inconvenient product since you have to pay off your balance in full before your statement closes in order to earn a full 2% cash back on your spend each month. Still, 2% is a perfectly reasonable return on unbonused manufactured spend, so the card still has its uses to me.

After I pay off my Chase Slate balance at the end of the month, I'll call to request a product change to the Chase Freedom Unlimited, which earns 1.5 Ultimate Rewards points per dollar spent everywhere, and that card will enter my rotation as a go-to card for unbonused manufactured spend.

Once that's complete, I'll wait a few weeks until I'm safely out from under the shadow of Chase's 5/24 guideline for new account approvals, and apply for another Chase Slate. I'll move available credit from my new Chase Freedom Unlimited account, and start this process over again.

Should you do this?

I don't give advice. I don't know your situation, and have no idea whether a 15-month, negative-interest-rate loan is right for you. But there are a few reasons you might consider it.

First, there are purchases that you might be considering paying for over time, like a car, which will cost less in total if you accelerate your payments using a negative-interest-rate loan.

Second, holding borrowed cash in a high-interest checking account, as I did, can serve as an "emergency fund" to protect you from job loss, emergency medical bills, or losses in the stock market. Even if, like me, you don't find the idea of an emergency fund particularly interesting from a personal finance perspective, you'll still earn more in a high-interest checking account than you will in a fixed-income mutual fund, a subject I've written about elsewhere.

Third, if you're a reseller or the owner of a business that needs access to capital in order to grow, you might consider financing expansion with a negative-interest-rate loan, especially if you work with vendors who only accept cash or give a discount on cash transactions.

A personal finance application cycle

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Last night I applied for two new credit cards which have nothing to do with miles and points. It was a strictly personal finance application cycle.

Citi Double Cash

When the Citi Double Cash was first launched, I explained why I wanted to sign up for the card: with its 2% cash back earning rate and 15-month introductory 0% APR on purchases, Citi is extending a fairly long-term negative-interest-rate loan. In life, when people offer you negative-interest-rate loans, you take them (present European finance ministries notwithstanding).

Before applying, I took the advice of my Twitter followers and lowered the only substantial credit line I had with Citi, a $13,700 credit limit on my Dividend Platinum Select card, to $3,000.

My online application for the Double Cash was immediately approved with a $5,200 credit limit.

Chase Slate

The Chase Slate and Citi Double Cash cards are two great tastes that taste great together: for the first 60 days of a Slate account membership, you can transfer up to $15,000 in balances with no balance transfer fee. Those balances are then interest-free for 15 months.

What this means is that I should be able to turn my $5,200 Citi Double Cash credit limit into a $20,200, 15-month negative-interest-rate loan by repeatedly manufacturing $5,200 in spend and then requesting balance transfers (in the first 60 days) from my Citi Double Cash to my Chase Slate.

Since I have over $25,000 in combined Chase credit lines, I didn't bother adjusting them before applying, knowing that if necessary I could reallocate my credit lines in order to have my Slate application approved.

That wasn't ultimately necessary. My online application was not immediately approved, and I was given an application reference number and phone number to call (877-260-0087). When I called last night, I was told Chase's "systems were not available." But when I called back this morning, after providing some information, I was told my application was approved, with a $500 credit limit.

Once the card arrives I'll call and have $15,000 of my existing Chase Freedom credit lines reallocated to my Slate card.

 

Conclusion

Of course, as great as long-term negative-interest-rate loans are, what's almost as great is being able to request a product change from my Slate card to a third Chase Freedom in 16 months!

Chase credit cards: IHG versus Hyatt (and current rebate offer)

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I've recently mentioned that I've lost interest in chasing credit card signup bonuses. These days, when I periodically reevaluate my miles and points strategy, I decide which cards I want to apply for based on their usefulness for manufactured spend (Chase Ink Plus), their ongoing benefits (Barclaycard US Airways), or both (US Bank Club Carlson Business Rewards).

Once I make up my mind, I naturally prefer higher signup bonuses over lower ones, but I won't typically apply for a card just for its signup bonus. A good illustration of why is the Chase British Airways 100,000 Avios signup bonus from last January. That was a uniquely high signup bonus, but I still have almost 53,000 of those Avios lingering in my British Airways account!

The card doesn't have any ongoing benefits (besides an incredibly expensive companion ticket) and is useless for manufactured spend (which is why I canceled it last month). Even worse in my mind, however, is that by applying for the card without a specific plan for the miles, I've allowed a significant chunk of them to sit in my account unredeemed.

In other words, worthless.

Chase's IHG and Hyatt co-branded credit cards both seem to have decent recurring benefits

Now that I've pared my total number of Chase cards by one, I've been considering two of Chase's co-branded hotel credit cards: IHG Rewards Club and Hyatt Gold Passport. While both are useless for manufactured spend, they both have recurring benefits that might make them worth holding onto:

  • The IHG Rewards card offers an annual free night at any IHG property in the world;
  • The Hyatt Gold Passport card offers an annual free night at any Category 1-4 Hyatt property.

Taken at face value, the IHG Rewards free night seems immeasurably more valuable than the Hyatt free night certificate.

Not so fast

The problem with the IHG Rewards night is that it can only be redeemed at IHG properties, and this creates a curious dilemma: while IHG has a good range of properties, from Holiday Inns to InterContinentals, their rewards program is a disaster. You can easily see this illustrated with one of my imputed redemption value charts:

In other words, IHG is not a program it makes any sense to manufacture spend with, and it only very occasionally makes sense to transfer Ultimate Rewards points to IHG Rewards Club.

That leads to the problem I have with the IHG credit card annual free night: you have one free night at any IHG Rewards Club property in the world, but in order to get the most value out of that free night, you need to redeem it at an expensive property.

But expensive properties are also the most expensive places to manufacture free nights at!

That leaves you with two bad options: move after one or two nights in your aspirational property, or stay and pay thousands of dollars out-of-pocket or in foregone cash back.

Unsurprisingly, affiliate bloggers tend to resolve that problem in the following way: not only should you apply for IHG's co-branded credit card, you should also convince your significant other to apply for the card, so you can take advantage of the cards' overlapping annual free night awards to book up to 4 consecutive free nights (Frequent Miler ably demonstrates this sleight of hand here).

When you see a scheme that complicated attached to a pitch to sign up for a credit card, you should go ahead and assume you're being sold a bill of goods.

Hyatt's annual free night certificate is worth up to $187.50

Hyatt Gold Passport, on the other hand, has an eminently reasonable award chart:

While it theoretically goes up to 30,000 points, in my experience the vast bulk of properties I've looked at are at the 8,000 point level. The Chase credit card's annual free night certificate can be redeemed for a night at a property up to Category 4, worth up to 15,000 Gold Passport points. Assuming those points are transferred from a premium Chase Ultimate Rewards account (Sapphire Preferred, Ink Bold, or Ink Plus), they're worth up to $187.50 in paid, mile-earning airfare.

A more reasonable value based on my own experience with Hyatt is 8,000 Gold Passport points, worth $100 in premium Ultimate Rewards point redemptions. Since the annual fee is just $75, this is a card that is likely to be worth hanging onto year after year. If you save just $80 (the cash redemption value) in Ultimate Rewards points, you're making a free-and-clear profit of $5 each year.

Hyatt's current award rebate sweetens the pot

For both current and new Hyatt Gold Passport cardholders, Hyatt will rebate 20% of all Gold Passport points redeemed through July 31, 2015, as long as they register their card for the promotion by March 31, 2015 (Frequent Miler has the details here). I've already made 40,000 points in award reservations during the promotional period, which would add up to an additional 8,000-point signup bonus in my case.

I'll agree it doesn't sound like much, but it is certainly icing on the cake.

Conclusion

Over the very long term, Chase's IHG Rewards Club and Hyatt Gold Passport co-branded credit cards both can offer a good value for their $49 and $75 annual fees, respectively.

But if you're the sort of person who would let the "anywhere in the world" IHG free night certificate trick you into booking an expensive stay at one of their properties, instead of one that's far cheaper using Hyatt, Club Carlson, or Hilton points, you may well decide you'd be better off staying away.

Personally, I find the Hyatt Gold Passport card far more convincing, and will be applying for it early next month.

Chase Ink Plus and reflections on urgency

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As you may have heard, Chase is currently offering a signup bonus of 70,000 Ultimate Rewards points to new applicants for the Ink Plus business credit card, which is as high as I recall ever seeing it go. The offer appears to only be available in-branch, which has the added benefit of meaning not a single affiliate blogger will receive a dime for any applications made under this offer.

I applied for the card yesterday afternoon, and my Chase banker promised to e-mail me by Saturday with the status of my application. I did call into a Chase application status number (I used 888-338-2586, but it seems there are many working numbers), but the frontline representative was only able to tell me that my application status was still "pending."

The Chase Ink Plus and Bold are cards I write about with some frequency as powerhouses for manufactured spend. But I'd never applied for one before.

The lie of urgency

If you started reading a range of travel hacking blogs on any given day, you would be bound to think that it was a stroke of luck that on that day only there were so many hyper-lucrative credit cards to apply for. Since there's no way offers that good can last, the blogger would naturally urge you to, in the Points Guy's famous words, "apply for both!"

Rick Ingersoll, a former blogger and occasional contributor over at Frugal Travel Guy, actually formalized this attitude in one of his screeds back in March. After a major devaluation of the American Express Platinum card, he urged readers to apply anyway:

"Decision time is upon us here with less than one month to go. Will you act in April of 2014 for either the Mercedes Benz version or straight out Platinum card? I will not be sending you Cheese to go with your Whine if pass on the opportunity."

The card has a $450 annual fee, by the way.

The truth of urgency

The reason I have never felt any urgency in signing up for an Ink Bold or Plus card, despite their lucrative bonus categories, is that those bonus categories are capped at $50,000 in spend per cardmember year, or a little over $4,000 per month on average. That means by delaying my signup, I'm not sacrificing all 250,000 Ultimate Rewards points earned in the office supply bonus category each year, I'm sacrificing just 20,000 points per month of delay.

On the other hand, I did know I would apply for an Ink Bold or Plus eventually since I want to get rid of one of my most expensive and least valuable cards, the Chase Sapphire Preferred, while retaining the ability to transfer Ultimate Rewards points.

Which brings me to the truth of urgency, which is that very, very occasionally, there are signup bonuses so good that you should consider timing an application while the bonus offer is in effect. The Chase British Airways offer of 100,000 Avios after $20,000 in spend, available late last year and early this year, was one such offer, which I took advantage of in January while signing up for an American Express Blue Cash.

Keep an eye on cards you know you want

Due to the lie of urgency, you're not going to be able to tell when a signup bonus is unusually high by reading most blogs. It's your responsibility as a travel hacker to investigate the cards you're interested in and keep an eye on their signup bonuses. That's the only way you'll know that a "higher-than-usual" 30,000 mile Bank of America Alaska Airlines card offer is 40% lower than the 50,000 mile offer available last December.

And be ready to apply when the time is right

Over at Hack My Trip, Scott is hosting a hysterical new guest series called Devil's Advocate, where they pierce conventional wisdom in the travel blogosphere. My favorite piece in the series so far is "App-O-Ramas Are Your Father’s Oldsmobile," where he demolishes the idea (which I've wrongheadedly spouted in the past) that you should apply for multiple cards on the same day to "hide" the applications from each other.

If so-called "app-o-ramas" are just an artfully concealed version of the lie of urgency ("quick, apply for another card!"), what's true is that unusually high signup bonuses can come along at any time. If there's a card you're interested in applying for, then to improve your chances of approval make sure that your credit score is always ready for a new application, for example by paying off your balances before they're reported to the credit bureaux (I use Credit Karma to see what dates my balances are reported).

My next application cycle

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Background: What's in my wallet?

Compared to many travel bloggers, I rely on signup bonuses for a relatively small part of my travel needs. For example, my Barclaycard Arrival World MasterCard came with a 40,000 "mile" signup bonus, worth $444 in statement credits against travel purchases.

However, since it earns 2 miles per dollar, worth 2.22% cash back against travel purchases, it's also my go-to card for non-bonused manufactured spend, and I've earned and redeemed many tens of thousands of miles with the card. The 40,000 mile signup bonus is a great incentive to include it in any application cycle, but it's not the only reason to get the card, and in a lower-signup-bonus environment the card might still be worth applying for — at least for the first, fee-free, year.

All this leads me to say that since I rely on manufactured spend more than signup bonuses, it's more important for me to find the right combination of cards on the earning side than merely waiting for the highest signup bonuses. For example, I applied for the American Express Blue Cash back in January because of its earning potential, not its signup bonus — then I included a few cards with valuable signup bonuses to round out my application cycle.

The cards I'm waiting for

There are a few cards I don't yet have, which are going to complement my current holdings nicely. I plan to apply for these cards during my next application cycle:

  • Bank of America Alaska Airlines Signature Visa. The signup bonus for this card went as high as 50,000 miles back in December, during what I called a perfect storm of signup bonuses. It's currently stuck at 40,000 miles after spending $10,000 within 6 months, which is a great offer. But I'm hoping it pops back up to 50,000 sometime soon, so I can keep earning Alaska miles after May 31, when the Bank of America Alaska Airlines debit card finally disappears;
  • American Express Starwood Preferred Guest Personal or Business. This card has a 25,000 Starpoint signup bonus, and the ability to earn Starpoints, which are incredibly valuable for hotel stays, but also transferable to partner airlines and redeemable for paid airline tickets. In other words, if approved I'll be putting this card in heavy rotation, despite its earning rate of just 1 Starpoint per dollar;
  • Chase Ink Bold or Plus. I write about the earning potential of these cards fairly regularly, mainly when I'm envying people who already have them. I've grown increasingly disgusted with my Chase Sapphire Preferred card, since I put my travel purchases on my Arrival card and just don't eat out all that often (no reimbursed business expenses here!). I'm looking forward to changing my Sapphire Preferred to a Chase Freedom card (doubling my quarterly bonus earnings) and adding an Ink Bold or Plus to retain the flexibility of my Ultimate Rewards points.

What's missing

After picking up those three cards I'll have access to virtually all the most valuable points currencies. But there are a few cards I'm still considering for their other benefits:

  • Chase Hyatt Visa. I've written about this card before when contemplating whether it's worth renewing for its annual free night certificate (short answer: yes, if you'll use it). It simply isn't the case that staying at a Hyatt property is the best option for me very often, which makes it a tough decision to spend a hard credit pull on the card without specific upcoming plans;
  • Membership Rewards. American Express has a number of cards with lucrative Membership Rewards earning structures, but until I can find a few reliable venders where I can maximize those bonus categories, I'm not willing to commit to a $95 or $175 annual fee, given the signup bonuses currently available;
  • Club Carlson Premier Rewards Visa Signature. I already have the business version of this card, and I love it. The personal version has a slightly higher annual fee ($75 vs $60), and gives an additional 40,000 Gold Points on each account anniversary. That's a great value, but I'm not convinced it's worth another $75, given that I can manufacture 40,000 Gold Points whenever I want, without paying $75 or waiting for my account anniversary!

Those are the cards that are currently on my mind. What do you think: what cards do I need to include in my next application cycle?

Quick update: my impromptu January application cycle

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[update 1/11/14: I never got around to calling Chase about my British Airways application, but today I saw that it had been added to my online accounts with a $2,000 credit line.]

Yesterday I announced that in honor of the 5% cash back "old" Blue Cash card still being available, I was moving my next round of applications up from the beginning of February. That meant scrounging around for the best, currently-available, signup bonuses. Unfortunately, the Alaska Airlines offer I wrote about in my "perfect storm" post is no longer available. Here's what I ended up applying for:

  1. American Express "old" Blue Cash. No signup bonus, no minimum spend requirement, no annual fee. 5% cash back at drug stores after spending $6,500 each year. Result: immediate online approval, $1,000 credit limit.
  2. Citi Platinum Select / AAdvantage World MasterCard. 50,000 miles after spending $3,000 within the first 3 months. Result: approval after calling the "status check" number, (888) 201-4523, $3,000 credit limit.
  3. Barclaycard US Airways MasterCard. 35,000 miles after first purchase. Result: immediate online approval, $1,000 credit limit.
  4. Chase British Airways Visa Signature. 100,000 miles after spending $20,000 within 12 months. Result: application pending. I called into the application status line today, (800)-436-7927, but have still been unable to get a decision or shuffle my credit limits around to secure approval. I'll wait and call back on Monday.

As you can see, because this application cycle was impromptu, I didn't have a chance to massage my credit by making sure all my credit card statements closed with a low or zero balance. My day-to-day high utilization rate negatively impacts my score between application cycles, making me look less credit-worthy (even though I always pay off my balances in full).

However, this doesn't bother me. I intend to only use the US Airways card once, to secure the signup bonus, and spend just $3,000 on the American Airlines card, so those low credit limits aren't a problem.

The $1,000 credit limit on the Blue Cash card, on the other hand, would be an issue except for the fact that American Express makes it easy to shuffle your credit limits between cards, so I'll be able to move all but a small part of my $10,000 Hilton HHonors American Express credit limit over to my new Blue Cash card (this is only possible within personal and business cards, not between them). That'll give me more than enough room to manufacture spend on my new 5% cash back card.

All in all, I'm pleased with the results of this application cycle, and hopefully I'll get approval for my British Airways application in the next day or two, possibly after moving part of my credit limit over from my Chase Sapphire Preferred card.

What's next: Chase card applications

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This is the second entry in my occasional series about what changes I see coming to my strategy for (nearly) free travel. In the first entry I discussed product changes, meaning my plans to change either from annual-fee to no-annual-fee versions (like the Barclaycard Arrival World MasterCard), or to more lucrative versions (Citi Dividend Platinum Select), of the cards I currently carry – while keeping my credit limits and age of accounts intact.

Going forward I'll be sharing my thoughts on my next round of new card applications, starting today with Chase.

Airlines vs. Hotels

Since I already have a US Bank FlexPerks Travel Rewards Visa Signature that gives me up to 4 cents per dollar in value on purchases at gas stations when I redeem my Flexpoints for paid airline tickets, I'm not too worried about paying for any upcoming flights.

Hotels on the other hand can get expensive very quickly, especially if I have to cancel or downgrade my Barclaycard Arrival World MasterCard in April, when my first annual fee is due (I'll ask to have the annual fee waived before I downgrade the card). I like to use that card to book my hotel stays since I earn hotel points and elite qualifying nights by booking directly through the hotel chain, and can then redeem my Arrival miles for travel purchases at an equivalent of 1.11 cents each, with partial redemptions allowed in increments of $25.

That's why my priority during this application cycle is to get a few cards that I can use to consistently manufacture large numbers of hotel points – hopefully also with a lucrative signup bonus.

Chase Ink Bold

I'll sign up for the Ink Bold with the standard signup bonus of 50,000 Ultimate Rewards points after spending $5,000 within 3 months, with a waived annual fee the first year.

Since my local gas stations haven't posed a problem lately, my plan is to split my $8,000 in monthly PayPal My Cash purchases between my US Bank Flexperks card and the new Ink Bold. Both cards earn 2 points per dollar spent at "gas stations."

The flexible Ultimate Rewards points earned by the Ink Bold can be transferred to Hyatt, where the standard room award chart tops out at just 22,000 points, or Marriott, which is not quite as good a value but can be worth doing under the right circumstances (for example to top up a 7-night Hotel + Air Package).

That leaves the question of what to do with my Chase Sapphire Preferred, which also has a $95 annual fee that is coming due in January. As I explained in this post, ideally you'll carry just 1 of the 3 "flexible" Ultimate Rewards cards, since each of them costs $95 annually. To justify paying $95 for another year of the Sapphire Preferred, I'd need to earn bonus points worth $95.

Valuing flexible Ultimate Rewards points at 2 cents each I'd need to spend $4,500 in the Sapphire Preferred's bonus categories, which isn't something I'm willing to commit to. After all, my no-annual-fee Hilton HHonors American Express and US Bank Cash+ cards also bonus restaurant spend (5 HHonors points per dollar in the former case or 5% cash back in the latter, capped at $2,000 quarterly). I'd be paying $95 to displace spend from (slightly less) lucrative, free cards. Besides restaurants, the Sapphire Preferred also bonuses "travel" purchases. Since the Ink Bold bonuses hotel spend, that mostly leaves things like cab fares, train tickets, and similar "miscellaneous" travel expenses, which are unlikely to add up to $4,500 during the year.

The two free options to downgrade my Sapphire Preferred are to a no-annual-fee Chase Sapphire card, or a second Chase Freedom account. The Sapphire account is tempting for the sake of preserving my restaurant bonus category, but ultimately I think I'll change to a second Freedom card. This year I was able to earn 7,500 Ultimate Rewards points in both the 1st and 3rd quarter bonus categories, and if even 1 of those lucrative categories comes back in 2014, I'll already be way ahead of where I'd be with a $95 Sapphire Preferred.

Chase Hyatt Credit Card

Since it's possible to apply for both a business and personal card from Chase on the same day, that raises the question of whether I should double down on Hyatt and also apply for the personal Hyatt Visa. It comes with a generous signup bonus of 2 free nights at any Hyatt in the world. Unfortunately, I'm no longer able to trigger the $100 statement credit that used to be offered when you reach the payment page on a new Hyatt reservation. On the other hand the standard offer now has no annual fee for the first year.

An additional benefit of the Hyatt card is an annual free night at a Category 1-4 hotel when you pay your annual fee each year – worth up to 15,000 Hyatt Gold Passport points.  A lot of bloggers will tell you that that annual free night makes the card worth its $75 annual fee.

I'll tell why I think that's baloney: manufacturing 15,000 Gold Passport points isn't that hard, since Hyatt is a transfer partner of Ultimate Rewards.  If you're manufacturing points at 1 point per dollar, sure, it'll cost you $118.50 in Vanilla Reload Network reload cards, plus whatever your cost is to liquidate them (although this cost can be lowered using one of my favorite techniques). If you're manufacturing 2 points per dollar spent (for example using the Ink Bold, above), then your cost is just $59.25, for example buying PayPal My Cash cards at 7-11. An intermediate case is if you're earning 5 points per dollar buying $200 gift cards at a cost of $6.95 each, for example at Staples, then the 15,000 Gold Passport points will cost around $100.

However, the advantage of all three of those methods over paying a $75 annual fee is that you actually end up with the points . That means there's no risk of "overspending" your annual free night certificate at a Category 1-3 property, or being "locked out" of using your certificate at a Category 5 or 6 property in your city of choice: just transfer slightly more or fewer flexible Ultimate Rewards points!

Don't get me wrong: in the real world, $75 for a hotel room – any hotel room – is a pretty good deal. For a room at a mid-range Hyatt, it's potentially a great deal. But the fact is, we can do better.

What's next: product changes

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Since my April round of applications, I haven't applied for any new credit cards (although I have done a few product changes, which – usually – don't involve a "hard pull" of your credit report). That's been for a few reasons. I've already got the two most lucrative credit cards for hassle-free manufactured spend: the Citi ThankYou Preferred card with 5 ThankYou points per dollar spent at drug stores (no longer available online, and in-branch applications have reported a high failure rate), and the Barclaycard Arrival World MasterCard, which earns 2.22 cents in value per dollar spent. Using just those two cards, I'm able to pay off student loans at pennies on the dollar (made even better using my favorite hack, now featuring Plink), and pay for hotels and airline tickets at about a 65% discount (while earning points for those paid flights and stays). Add in my Delta Business Platinum American Express card, which earns 1.4 Skymiles per dollar at the $25,000 and $50,000 spend levels, and that accounts for just about all of my manufactured spend budget (although I can't resist maintaining a 50,000 Club Carlson point balance, good for two free nights at any Club Carlson property in the world).

While it's still true that you'll never earn more points per dollar than you do meeting a minimum spending requirement, I have no interest in scoring every single signup bonus before I'm 30. That's why I focus on putting spending on the wildly lucrative cards I already have, instead of applying for 3-4 new cards every 91 days.

However, my year of manning the mint with Citi ends with my January statement, and my first Barclaycard annual fee is due in April, so naturally I've turned my mind towards the future. In this occasional series I'll share my thoughts on my next moves. Today's edition: product changes!

American Express Hilton HHonors Surpass

This is a card I've been eyeing since I finally found PIN-enabled Visa gift cards at a local supermarket. Earning 6 HHonors points per dollar spent at grocery stores, and 50,000 HHonors points for upgrading my current, no-annual-fee version of the card, seems like a great value proposition, even at $75 for the first year.

To illustrate this, take a property I love in a city I love, the Hilton Prague Old Town (the Hilton Prague hotel is even more spectacular, but slightly less convenient), which in June (high season) goes for 50,000 points per night. Obviously I'll earn one free night just for upgrading, which makes that night cost about $75, or a little less (depending on whether you decide to prorate the $75 annual fee over all the additional points you earn, or just over the upgrade bonus – the latter is slightly more accurate but much more complicated). The advance purchase rate in June is around $250 after taxes, so you're paying about 30 cents on the dollar.

If I were able to aggressively manufacture spend on the Surpass card at grocery stores, I could earn additional nights after every $8,333 in spend. If that takes the form of Visa gift cards at a cost of $5.95 per $500 card, I'd be paying around $101.15 per night, or $80.92 if I redeem my points in batches of 5 nights, with the 5th night free, a 60-68% discount. In other words, it's a good workhorse of a card (for the first year), but not one that offers incredibly outsized value.

Unfortunately, recently my local supermarket...stopped allowing gift card sales to credit cards. Until I find a more reliable source, I'm shelving the upgrade.

Citi Dividend Platinum Select

While this card does typically offer a small signup bonus of $100 in Dividend Dollars for new applicants (although it has also reached as high as $300), I'm more interested in the rotating 5% cash back categories. Unlike the Chase Freedom and Discover More/it, the Dividend Platinum Select's cap on bonused earnings is annual, instead of quarterly, meaning that a single lucrative quarter (2013 offered drug stores in Quarter 1) allows you to max out $300 in Dividend Dollars. Since I won't be using my ThankYou Preferred card after mid-January, it's an obvious candidate for a product change.

Barclaycard Arrival World MasterCard - No Annual Fee

I currently have the $89 annual fee version of this card, which I've explained before is only worth carrying for the first, fee-free year. Barclaycard does have a reputation for offering annual fee waivers (or statement credits for their cards' annual fees) to good customers, so my intention is to call in April to ask if they'll offer me an $89 statement credit. After all, I am a VERY good customer. If not, then I'll call back and ask for a product change to the no-annual-fee version of the card, keeping my credit history with Barclaycard and any points I've stockpiled. Since the redemption structure is actually identical for the $89 and fee-free cards, I won't lose any of my points' value when I make the product change.

In future installments in this series I'll be discussing the cards I'll be canceling outright and the new cards I'll be applying for in the new year.