erethizon

I was just approved yesterday for my first Chase card in over 10 years as I’m looking to get back in their good graces after a bankruptcy. I’ve never done any credit card churning or manufactured spend and have no interest in doing so now.

That said, I got the Chase Freedom Flex and because the current quarter is for grocery stores and because they have the 5x points at grocery stores for the first year you have that card that means I can currently get 9x points on the first $1500 I spend at grocery stores this quarter. I was prepared to resist the sirens call of pushing the category limits for just 5x points, but 9x points may be too tempting to pass up.

With that in mind I have a question about gift cards. I’ve been reading the forums a lot lately and it does seem like they can tell the difference between gift card and non-gift card purchases. To be clear, I have no interest in anything that even smells like manufactured spend. I’m not going to buy any Visa gift cards or anything else like that. For the most part I am planning to buy cards for the store I am in (e.g. Vons gift cards from a Vons store, Sprouts gift cards from a Sprouts store, etc.). I suppose if it won’t cause problems I wouldn’t mind buying an Amazon gift card or two if it definitely won’t cause trouble. Truth is what I really want are Costco gift cards since that is where I buy almost all my groceries, but I doubt any grocery store sells Costco gift cards.

My plan was to go to grocery stores a dozen or so times over the next 3 months and purchase $100 in gift cards along with some grocery items each time until I have spent $1500 at grocery stores.

So I have a couple of questions. The first is, do gift cards count toward minimum spend for the Chase Freedom Flex? I read about some cards from some issuers updating their terms to say that gift cards don’t count. I know the goal was to prevent manufactured spend but if it is means a Vons gift card purchased from a Vons will not be counted, then buying gift cards is pointless. The most important thing is that I spend $500 to get the first 20k rewards points. It would be a huge waste if I only spent $400 on non-gift card purchases over the next 3 months and didn’t get the 20k because the gift cards didn’t count.

For clarity, under normal circumstances I spend less than $500 in a 3 month time period, so it would be better if some of the $500 for the intro bonus could be gift cards, but if it is a risk then I may want to make sure I get at least $500 in non-gift card purchases.

My second question, similar to the first, is do gift cards count toward the 5x (or 9x in my case) rewards category? After all, the only reason I would even consider spending $1500 over the next 3 months (or slightly over as there are a couple of non-grocery store expenses I am likely to make as well) is to get the 9x points.

Ideally gift cards for a grocery store (and possibly Amazon/Costco) purchased from a grocery store would count both as minimum spend and rewards category spend without causing any problems. I know the crack down on gift card purchases has generally been focused on something much more serious than what I propose here, but I am trying to tread lightly with Chase since this is my first time back with them in over a decade (after declaring bankruptcy on them during the 2008/2009 financial crisis and leaving them with $50k in unpaid credit card debt).

If the advice people here recommend is to avoid all gift cards then I will just push to spend $500 over the next three months and just accept the small 9x rewards bonus on whatever I manage to spend at grocery stores. If buying $1200 in gift cards won’t be a problem at all then I may do that (though it will probably take me years to use them all up if they are not for Costco). If a small gift card balance is a better choice than I can do that instead (i.e. buying $200 in gift cards over 3 months rather than $1200). It mostly comes down to whether they will know that a $146 purchase from Vons was only $46 in grocery items and $100 in a Vons gift card and whether they will care and the purchase will count toward rewards/minimum spend if they do know.

garykung

Yes for both, depending on the GCs you are buying.

A friendly reminder - there is no doubt you have a prior unsatisfactory banking relationship with Chase. Don't go too far. IIRC - some people actually got their cards cancelled just after approval. So your account may still be cancelled.

erethizon

Someone mentioned that to me yesterday which resulted in my reading up on hundreds of posts about why Chase has cancelled accounts in the past. I am definitely going to be paying close attention to the status of my card for the next 2 weeks and am likely to refrain from causing trouble early on especially.

It really comes down to this, if something as simple as buying a $50 Vons gift card at Vons in the same purchase as buying other grocery items is going to upset Chase then I will just avoid doing to so all together. Using gift cards is a pain anyway and while I can't deny that 9x is an amazing bonus (5x is generally considered top notch and higher than that is basically unheard of for an entire category of spend), it doesn't change the fact that 9% of $1500 is still only $135 which is not that much if it means having to juggle gift cards for a couple years AND pissing off Chase. I might be willing to juggle gift cards for $135 but not at the expense of getting on Chase's bad side (again).

mhdena

You may want to make some normal purchases for the first few billing cycles, pay bills etc.

erethizon

I'll definitely be putting my normal spend on the card as well. It's mostly a question of whether I should be avoiding all gift card purchases for the first few billing cycles. After the first few billing cycles I won't be buying gift cards anyway since the 9x promotion will be gone for good in 2.5 months and so there will no longer be any reason to buy gift cards.

emcampbe

I'd just look at terms carefully. I'm not sure the 5x grocery promotion would stack with the current 5x quarterly bonus, but I could be wrong.

FYI, I've always gotten points bonuses on gift cards purchased at grocery stores, but I don't do MS. I typically like to have balances in iTunes and Amazon, so I'm buying $100-$150 Amazon maybe once every 1-2 months, and $25-$50 iTunes every couple of months. Never had issues - either when buying on their own or when combining with my weekly groceries. When using my Chase MP I get 2x miles, and the relevant bonus when offered on Freedom, etc.

garykung

OP's problem with Chase was not mentioned in this thread, but other.

In short - OP had a bad debt of $50,000 from Chase that has been discharged by bankruptcy. That's the bigger issue.

erethizon

That is good to hear.

I was a little surprised to read about the 9x bonus as well. I figured they would cap it at 5x but I read a couple of articles saying 9x and so am taking them at their word (though I acknowledge information found on the internet can easily be false). Here are the two articles I read:

Chase Freedom Flex and Unlimited: 5x on Groceries and a $200 Bonus (businessinsider.com)

Up to 9X on Groceries with new Chase Freedom Flex / Unlimited Bonus Offers – MilesTalk

erethizon

I mentioned it in the last sentence of the second to last paragraph here as well, but I did go into much greater detail in the other thread. If Chase doesn't shut the card down in the next few weeks I'll probably post all the details (much like I did in the other thread) in whatever spot you recommend is most appropriate. I'm sure I'm not the only one that would like to hear a data point of getting back with Chase after declaring bankruptcy on them.

Duke787

It stacks. I'm at the tail end of my 5x grocery promo from signing up last year and I'm getting 9% right now.

I don't do MS so can't comment on doing that with the 9% but it definitely stacks. Below is from my statement and a recent trip to Trader Joe's.

erethizon

That point break down is very nice. Much better than my other cards that just dump in the points at the end with no information on how they were calculated.

Do you have to wait until your statement for the month posts to see a point breakdown like this or can you look up this point breakdown online any time after the purchase has posted?

cjw2001

The point breakdown is available as soon as the transaction posts.

EdofFX

I think gift cards for an actual store (Best Buy, Amazon, etc.) are okay when combined with actual grocery purchases. I have been doing that since July 1. I just add an Amazon gift card along with normal grocery purchases, and have been getting 9 pts per dollar. If your account is being watched, I would do it in moderation just to play it safe. (I don't know where the line is)

What may not be okay are those cash like gift cards (Visa, MC, Amex, etc.)

I know of no grocery store that sells Costco gift cards. Only Costco sells Costco gift cards. You cannot use the Freedom Flex in Costco, because it is a MC.

mhdena

You can use Discover, MasterCard and Visa at Costco Online. They sell the Costco Cash Cards there.

Chris58

[QUOTE=erethizon;33407491 The most important thing is that I spend $500 to get the first 20k rewards points. It would be a huge waste if I only spent $400 on non-gift card purchases over the next 3 months and didn’t get the 20k because the gift cards didn’t count.
.[/QUOTE]

Gift cards will count towards required spend for the 20k bonus.

Since you're most concerned about this point you can find out easily and quickly.

In the first week after you receive the new card make about 5 or 6 charges for anything anywhere. Then since you mention Vons, go there and buy a single $20-$500 variable load Visa gift card, (NOT at Target or Walmart). This card will cost you a $5.95 load fee but you can simply use the money on the card quickly anywhere Visa is accepted, (utility bills, insurance, etc,,, etc,, anywhere), forget the $5.95 fee because you're going to get 9x UR's = 4,554 UR's.

Since you're concerned about possible appearances just don't buy a $500 load card, (total charge $505.95), add a few groceries to make the total purchase $512.xx or whatever. Or, if you wish, just load the card with any number you like, for example $373.57, or $458.61, etc,, etc.. Since you're not going to play the MS* game and liquidate this gift card to a money order the amount doesn't really matter. You just want to have an amount on the card you can track as you spend this money for routine expenses.

As soon as $500 in charges post to your new Flex you'll see the 20k bonus included in "Points earning next statement" on the first page of the UR portal of your Chase login, (and the 24,554+ points WILL post on your first statement). Since this is your only Chase account it will probably say $245.54+ Cash back available, (but they're actually UR's unless you actually redeem them for cash).

You mention many comments about Chase not liking people buying gift cards. But keep in mind there's a lot of people who believe if you buy a single gift card Chase will shut you down, (simply not true).

I'm NOT suggesting you go crazy with gift cards with this or any other credit card. Since you have a full year of 5X @ Grocery, (plus an extra 4X up to $1,500 this quarter), This card should easily net you 86K UR's just from grocery.