Preserving Ultimate Rewards Points While Downgrading Cards

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I get a lot of questions about the logistics of upgrading and downgrading cards that can potentially earn Chase Ultimate Rewards points.

The three cards that directly earn Ultimate Rewards points are the Chase Sapphire Preferred® Card Chase Sapphire Reserve® Card, and Ink Business Preferred℠ Credit Card. However, you can supplement those cards with the Chase Freedom® CardChase Freedom Unlimited®, and Ink Business Cash℠ Credit Card. While those are technically cashback cards (where each point can be redeemed for one cent cash), you can transfer points earned on any of those cards to Ultimate Rewards at a 1:1 ratio.

This is why a combination like the  Chase Sapphire Reserve® Card and Chase Freedom Unlimited® is so powerful. By having both of those cards you earn 3x Ultimate Rewards points on dining and travel, and 1.5x Ultimate Rewards points on everything else. Since Ultimate Rewards points on the Sapphire Reserve can be redeemed for 1.5 cents towards the cost of a travel purchase, that means you’re getting a value of 4.5% on dining and travel, and a value of 2.25% on all other purchases, which is awesome.

Combining these points is easy, and can be done directly on the Ultimate Rewards website. There’s one question I frequently get regarding the logistics of upgrading or downgrading cards.

For example, sometimes readers have the Chase Sapphire Preferred® Card and want to downgrade it to the Chase Freedom Unlimited®, and then apply for the  Chase Sapphire Reserve® Card (the order of this is important, since you can’t be approved for the Reserve if you currently have the Preferred, or have received a new cardmember bonus on it in the past 24 months).

The question is what happens to your Ultimate Rewards points when you downgrade to the Freedom Unlimited, since you won’t have a card that earns Ultimate Rewards points anymore. The good news is that the process is easy. Let’s use the above scenario as an example:

  • When you convert your Sapphire Preferred to the Freedom Unlimited, your points will automatically be transferred over; however, those points will no longer be Ultimate Rewards points, but rather will be points that can be redeemed for one cent cash back
  • Once you apply for the Sapphire Reserve (or whatever other card earns Ultimate Rewards points), you can then transfer those points back to the card, and they will once again become “full” Ultimate Rewards points

If you have multiple cards you’re canceling, just make sure you first transfer the points to a card that you’re keeping or a card that you’re directly product changing.

When you do this you’ll temporarily not have access to the full potential of the points, but that problem will be solved once you again open the card that earns Ultimate Rewards points. It really is a very straightforward process.

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Comments

  1. This assumes you’ll be approved for a Sapphire card. What if you’re not? Then you can’t transfer your UR points out.

    What do you think of this potentially safer method: let’s say you live with someone who also has a Sapphire card. Transfer all your UR points to that person (which should be free and easy and allowed by the rules). Do your card downgrade/application shenanigans, then transfer points back if needed once you have a Sapphire card again.

    I’m not sure if there any limitations to this (e.g., amount of points you can transfer, or number of transfers per year, etc). ALSO: if you have only a Freedom card, can you transfer your points to a spouse/partner who has a Sapphire card? If so, then my method isn’t necessary – just transfer to your spouse in the event that you can’t get yourself a Sapphire card.

  2. So I have both the Reserve and Preferred and want to get rid of the preferred… Should downgrade to the Freedom Unlimited or should I cancel the preferred and sign up for the Freedom Unlimited? On the surface it only looks like I’d forgo the sign up bonus for the Freedom Unlimited. I’ve only had the CSP for about 10 months so it’s not like it’s been on my credit for a long time.

  3. @ Bill — Do you have the Freedom as well? If not, and I were in your shoes, I’d product change to the Freedom or Freedom Unlimited, and then apply for the other one. Together the cards are an unbeatable combo.

  4. @Bill it also depends on how important keeping your credit history intact is. If you’ve had the CSP for a while, closing the account will drop the average age of your accounts and you’d be better off downgrading.

  5. @Bill, all depends on 5/24. If you’re under, cancel and apply for both Freedom Unlimited and Freedom. If over, product change. Getting and keeping both is a no-brainer.

  6. @ Lucky I Do not have the normal Freedom, but my Husband does. Neither of us have the Freedom Unlimited, so it’s an obvious gap in our card strategy. And we’re under 5/24.

  7. @ Bill Klein — If you’re under 5/24 and just want the Freedom Unlimited, then I guess it depends on whether you value the 15K point bonus at more than an inquiry. I’d probably product change in your shoes. However, there could be value in picking up a second Freedom, since the bonus is capped on $1,500 per quarter. By getting a second one you’d be doubling the cap on your bonus.

  8. Lucky, I current have a Ink Cash and enjoy the 5% back in UR. What are my chances of getting approved for the Ink Preferred card and the 80K points without cancelling the ink Cash?

    I have never had ink Preferred previously. The ink Cash was downgraded from a Ink Plus a year ago.

    Thank you.

  9. @ Kevin — Assuming you’re otherwise eligible, you should have good odds. You can have both cards, so there’s nothing preventing you from getting it. I’d go for it. 🙂

  10. @Lucky Thanks for the info and the feedback. Love the blog, love traveling, love not really having to “pay” for incredible vacations with points. Stayed at the W in Punta De Mita during Christmas per your review ended up getting $18,000 worth of value from 100,000 starpoints <3

    And to think I used to put all my spend on the Delta SkyMiles card lol.

  11. 15,000 points w/ a CSR = $225. That’s not worth more than an inquiry? You’ll drop a few points for a few months, big whoop. Cancel the card and get the signup bonus for both cards (Freedom and Freedom Unlimited). Have your partner sign up and get the bonus as well. It doesn’t sound like you’d max out 2 Freedoms if you don’t even have 1 right now…

  12. Lucky. I haven’t been traveling much and was able to change to Sapphire from Sapphire Preferred. My card number is unchanged, I don’t pay 95$/year and I keep all my points and continue to earn points. Only loss I can tell is foreign transaction fees. Seems like a good deal to me.

  13. is the rule no two products from the sapphire line or just not the preferred and reserve at the same time? Because if the latter, you could downgrade to the regular chase sapphire instead of losing a freedom signup bonus.

  14. Lucky,

    You wrote, “…earn 3x Ultimate Rewards points on dining and travel, and 1.5x Ultimate Rewards points on everything else.”

    Not sure you’ve got that right. My CSR gives me 3x on dining/travel but only 1x on everything else.

    What am I missing??

  15. I’m confused – I currently have the Freedom, CSP, and Ink. Finally under 5/24 and want to get the Reserve. Would I need to transfer my CSP UR points to the Freedom or Ink first, before I downgrade it to the Freedom Unlimited?

  16. @ Douglas — Nope, if you downgrade to the Freedom Unlimited the points can just stay on there, and then can later be transferred to CSR. Let me know if you have any other questions. 🙂

  17. @ Ari Nadelman — You earn 1.5x points with the Freedom Unlimited, so that strategy assumes you have the CSR and the FU.

  18. Why do you say Freedom and Freedom Unlimited Card’s don’t earn Ultimate Rewards points? They most definitely do. They can even be used to book travel through the Chase portal. Obviously it won’t be as good of a redemption as reedeeming or transferring them to travel partners with a Reserve.

  19. @Lucky

    First off, GREAT article, i have been trying to get this exact information from other sources. So I currently have a Chase Sapphire Preferred that i got over 2 years ago and i am outside of 5/24 🙂 I want to downgrade to Chase Freedom Unlimited, then signup for Chase Sapphire Reserve to get the bonus points and take advantage of the other perks of Reserve vs. my current Preferred.

    My question is, how soon after downgrading to Freedom Unlimited can I apply for the Reserve? Is it instant that my status as a “Non-Sapphire Cardholder” goes into effect securing my eligibility for the Sapphire card as well as the bonus? Or should I wait a period of time before turning around to apply for the Sapphire Reserve?

    (this is all assuming i am approved which I am sure I will be AND that I am outside 5/24 which i am as well)

  20. @ Jesse — I’d recommend waiting a couple of days between downgrading and newly applying for the CSR, in your shoes. Good luck! 🙂

  21. Thanks for this article – I’ve been wanting to do the same downgrade to upgrade thing. Just to clarify, if you’re going from CSP to CFU, your points don’t lose any value, correct? And then when you transfer them to CSR, do the increase in value from 1.25 to 1.5? Or do they maintain the 1.25 redemption rate on travel, and points that you earn subsequently get the 1.5 redemption rate?

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