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Discover Miles vs Chase Freedom Unlimited: which wins for travel?

by on Fri May 20, 2016 • No Comment
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Discover and Chase each offer a credit card that is relatively new and has some great benefits for travel worth considering. We’re going to take a look at the Discover Miles card, the Chase Freedom Unlimited card, and how to decide which one is better for you.

We’re going to go into more detail below, but the short answer is:

Here’s a rundown of the features of each card:

  • Discover Miles: This card earns 1.5X miles on all purchases, everyday. But there’s a kicker. At the end of your first year of cardmembership, all of the miles that you earned during the previous year will be doubled. The miles earned are Discover Miles, not airline miles, and cannot be transferred to airlines. Miles can be redeemed as a statement credit toward travel purchases; 100 miles always equals $1.00. When traveling abroad, no foreign transaction fees will be charged.This card has no annual fee.

  • Chase Freedom Unlimited: This card earns 1.5X points on all purchases everyday. The points earned are Chase Ultimate Rewards Points. If paired with a premium Chase credit card such as the Chase Sapphire Preferred, this points can be transferred to airline miles and hotel points. Either way, Ultimate Rewards can be redeemed as cash at a rate of 100 miles equals $1.00. This card has no annual fee.

Depending on your spending patterns and travel needs, one of these cards might be better for you than the other. Let’s take a look at some of the pros and cons of each card.

Discover Miles

discovermilesPros

Miles Doubled After First Year

One of the biggest pros of the Discover Miles card is that for the first year you carry the card, all of your earnings will be doubled. This means that while the card earns 1.5 miles per dollar spent, at the end of the year you will be given an additional 1.5 miles per dollar spent over the course of the previous 12 months. Effectively, for the first year you will be earning 3 miles per dollar spent on all purchases. So if you spend $1,000 a month you’ll end up with 36,000 miles at the end of your first year.

No Foreign Transaction Fees

This card has no foreign transactions fees. Having a card that doesn’t charge foreign transaction fees is really important when traveling internationally. Foreign transaction fees can add an additional 1-5% to the cost of your trip.

Same Earning on Everything

You don’t need to worry about what categories have higher rates or what quarterly categories are promoted. This card earns 1.5X on every purchase, all the time. The only deviation from that earning rate is that all miles earned are doubled at the end of the first year of cardmembership.

No Minimum Redemption

It doesn’t matter how many miles you have in your account, you can always redeem them at a rate of one cent per mile toward your travel purchase, so for example 10,000 miles = $100 in statement credit for travel purchases. You can reimburse travel purchases up to 180 days (6 months) after charging the purchase to your credit card.

$30 Annual Wifi Credit

You can purchase up to $30 worth of in-flight Wifi each year and Discover will reimburse that amount to your credit card. Definitely a good thing if you want to get a little bit of work done on your flight!

No Annual Fee

With no annual fee and a lot of benefits, this card is a great option.

Cons

Discover Network

Being part of the Discover Network, you may have some trouble using this card, especially abroad. This somewhat negates the pro of having no foreign transaction fees as many international retailers will not accept Discover cards.

No real airline mile option

Discover miles can’t be transferred into real airline miles, even if you hold another card. They’re just cash for travel miles you can use to get statement credit for any travel purchase.

Chase Freedom Unlimited

freedomunlimitedPros

Same Earning on Everything

You don’t need to worry about what categories have higher rates or what quarterly categories are promoted. This card earns 1.5X on every purchase, all the time.

Airline Transfers when Paired with the Chase Sapphire Preferred

The Chase Freedom Unlimited really comes alive if you have a premium credit card issued by Chase, like the Chase Sapphire Preferred. Having a premium card will unlock the ability to transfer miles earned using the Chase Freedom Unlimited to airline and hotel transfer partners like United and Hyatt. The ability to transfer miles to airlines and hotel partners can easily double the value you can get out of your miles.

No Minimum Redemption

It doesn’t matter how many miles you have in your account, you can always redeem them at a rate of one cent per mile as a statement credit.

No Annual Fee

The Chase Freedom Unlimited does not have an annual fee.

Cons

Chase Sapphire Preferred Annual Fee

In  order to get the most value out of this card, you need a premium Chase credit card, all of which have annual fees. The Chase Sapphire Preferred has a $95 annual fee (there is a $0 introductory annual fee the first year).

Foreign Transaction Fee

If you travel internationally and use your Chase Freedom Unlimited, you will be charged a foreign transaction fee of 3% of each transaction in U.S. dollars.

Which Should You Get?

In short: whichever card makes the most sense for you. While it might look like the Discover Miles card has more pros than the Chase Freedom Unlimited, the value of having one over the other really depends on how you use the card.

If you are willing to have a card that has an annual fee like the Chase Sapphire Preferred, you will get more value out of the Chase Freedom Unlimited as long as you transfer your Ultimate Rewards Points to airline and hotel transfer partners and make smart redemptions with your miles.

If you are looking for something easier, aren’t interested in another credit card with an annual fee, or if you expect to spend a significant amount of money within the next year the Discover Miles card is a better option.

Chase Sapphire Preferred® Card

Miles dont expireas long as card is open
Learn more

Partner Offer

50,000 bonus points

Intro Offer

$0 introductory annual fee, then $95

Annual Fee

$0

Foreign Transaction Fee Waived

Yes

Points Can Transfer to Airline Miles ?

Still confused? Have a question?

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"These responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered."

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