Over the last 6 months I have been diving deeper into the world of travel hacking and credit cards.
You may be asking what exactly is travel hacking and that is a good question. No, travel hacking is not someone sitting on a computer illegally getting into someone’s computer or bank account.
Travel hacking is a strategic use of credit card sign ups and collecting credit card points, hotel points, airline miles which you can cash in for free flights, hotel rooms, flight upgrades and more.
Unlike computer hacking, travel hacking is totally legal and is done by tens of thousands of people each and every year.
I dabbled into travel hacking a couple of times over the years. The first time was when Tonya and I took Makenzie to California for a 10 day trip. I was able to get our hotel rooms for free from travel hacking.
I also did some travel hacking when Tonya and I took our daughters and their husbands on a 16 day trip out west. We were able to save nearly $9,000 on hotel rooms and flights in the process.
Since dipping my toes into the travel hacking realm, I definitely have learned more since then.
What I want to do is share some of what I have learned as it comes to travel hacking. So, if you are thinking about jumping into the game, you will have some of the basics that will help you in the process.
Today I want to dive into the Chase 5/24 rule. If you are getting into travel hacking, this is where you want to start. Knowing how the 5/24 rule works will help you make other decisions as it pertains to acquiring travel credit cards.
What is the Chase 5/24 rule?
As I am sure that you know in the travel awards game major banks have credit cards that they issue. For example, Citi, American Express, Capital One, Bank of America, Barclays and Chase all offer travel credit cards.
Each one of these banks have application rules as it comes to their credit cards and Chase has some of the most restrictive.
The Chase 5/24 rule basically is that if you have opened up five personal credit cards from any company in the last 24 months, you will not be approved for a Chase credit card.
For example, if you have received two Chase personal credit cards, two personal American Express cards and one personal Capital One card, and you opened them up in the last 24 months, you will not generally be approved for another Chase credit card.
You will not find any written language from Chase as it comes to the 5/24 rule. The rule has been documented in the travel hacking world for year. People have shared their experiences as it pertains to Chase credit cards.
Why is the 5/24 Rule Important?
The 5/24 rule will not affect you if you are doing some general travel hacking. That is where you don’t expect to open up more than 5 credit cards in a two year period. If that is the case, you can find the best offers that meet your needs and choose those.
For people that want to dive headfirst into the travel hacking game, then knowing how the 5/24 works will guide you in what cards you will get.
Chase has some of the best sign up bonuses in the travel credit card world. Plus, the value that those points represent are some of the best in the business.
The points in the Chase universe are called Chase Ultimate Rewards or UR for short. These points can be transferred to various airlines and hotel brands which can stretch your points to do more for you.
So, being on the wrong side of the 5/24 ledger can affect you negatively. It would stop you from getting some of the best credit cards for helping you to travel.
What Cards are Affected by the 5/24 Rule?
As I mentioned before, personal credit cards that you have opened up in the last 24 months from any institution will apply towards your 5/24. This includes gas credit cards and store credit cards.
Closed cards that have been opened in the last 24 months apply to your 5/24 status.
If you are an authorized user on someone’s credit card, that will also apply towards your 5/24 status. It does that since it shows up on your credit report.
You can call the Chase reconsideration line and ask for it not to be applied to your account.
Business cards from Discover, TD Bank, and Capital One Spark Miles cards apply to your 5/24 status. These are the only ones. As you will see in the next section most business cards don’t affect your 5/24 status.
How Business Cards Affect Your 5/24 Status?
As with almost everything in life there are some exceptions to the rule and the 5/24 rule is no exception.
Business cards issued by Citi, Bank of America, Chase, Barclays, and American Express don’t generally apply to the 5/24 rule.
The reason that business cards don’t apply to the rule is because business cards don’t generally show up on personal credit reports.
Another nuisance to this is that you still need to be below the 5/24 mark to be able to get a Chase Business Card even though it does not apply to your 5/24 count.
Summary of Exception Rules:
- Chase business cards are subject to the 5/24 rule. You will not be able to get a Chase business card if 5 or more cards show up on your personal credit report.
- Applying to a Chase business card won’t apply to your 5/24 since it won’t show up on your personal credit report.
Example of the Exception Rules:
- You are at 3/24 since 3 cards are showing up on your personal credit report. You apply and get a Chase business card. You stay at 3/24.
- You apply and get a personal credit card. You will now be at 4/24 since the card shows up on your personal credit report.
- You apply for and get another Chase business card. You will stay at the 4/24 level.
- You get another personal credit card which takes you up to 5/24.
- If you apply for a business card now, you will not be approved since you are at 5/24.
How Do You Check Your 5/24 Status?
You may be wondering how I am going to figure out what my 5/24 status is. One easy way to do this is through the website Credit Karma.
I have used Credit Karma for years and the nice thing about it is the fact that it is free. Plus, signing up for it is very easy. All you need to do is answer a few questions, and you’re all set to go.
When you go to the main page of their website and you click on “Sign up for free” in the upper right hand corner, it will take you to this page to sign up.
Once you have your account setup, you can check to see what your 5/24 status is.
You can scroll over “Credit” at the top of the main page. Then you can click on “Accounts.”
That will take you to a page with all of your open accounts. Next, you will click on one of your credit cards. You can click “Report Info” which will then show you the date that you opened the card.
As you can see the last card that I opened up was December 27th.
Chase Application 5/24 Strategy
So, if you are still reading and you want to get the travel hacking game then you will want a strategy to get the most out of the cards that you are going to get pertaining to your 5/24 status.
Start with Business Cards
If you want to apply for business and personal cards, you will want to start with Chase business cards first.
Remember they both are subjected to the 5/24 rule but the business cards will not show up on your personal credit report so they won’t count towards your 5/24.
Most people may not think that they qualify for a business card but you don’t need to own a business to qualify for a business card. Most people can actually qualify for a business credit card.
Some things that apply towards being able to get a business card include being a sole proprietor, independent contractor, selling things online, driving for Uber, delivering food for Grubhub, tutoring people, babysitting, selling crafts online, or walking dogs.
These are just a drop in a bucket the number of things that you can actually do to be able to get a business credit card.
Chase has many business cards to choose from but my suggestion would be to start with Chase Ink cards. The Chase Ink Business Cash and the Chase Ink Business Unlimited cards have no annual fee.
The Chase Ink Preferred Business Card has a $95 annual fee but it also comes with some perks the other two do not. Plus, you can access the Chase Travel Portal with this card which you can’t do with the other two Chase Ink cards.
The portal allows you to book flights, hotels, and rental cars through the portal. More importantly, it allows you to transfer your points to numerous airlines and hotels to use to book them.
These cards have Chase Ultimate Rewards points which are the most valuable in the Chase ecosystem.
I have the Business Cash and Unlimited cards. I plan on getting the Preferred card at some point.
Chase Personal Credit Cards
As with the Chase business cards, my suggestion when getting personal cards is starting out with cards that are in the Chase Ultimate Rewards ecosystem.
My suggestion would be to start with either the Chase Sapphire Preferred or the Chase Sapphire Reserve card. You cannot hold both of these cards at the same time so you need to pick the one that fits your needs the best.
Just like the Chase Ink Preferred Business card, the two Sapphire cards allow you access to the Chase travel portal along with transferring points to various hotels and airlines.
Next, my suggestion would be to get the Chase Flex and/or the Chase Unlimited card. Each has no annual fee and they serve different purposes in a travel hacking approach.
I personally have the Chase Sapphire Preferred card. I am going to get both the Flex and Unlimited cards.
Chase Cards Other Than Ultimate Rewards
My suggestion after having the above cards, is to move on to other Chase cards or other brands of credit cards, such as American Express or Capital One.
Chase has many other branded business cards, for example, Southwest or Hyatt to just to name a couple of them. They also have many branded personal cards that you can also choose from.
Remember if you are able to and you choose the business cards, they don’t go towards your 5/24 status.
What to Do if You are at or Above 5/24
If you are reading this and you did not know about the 5/24 rule and you are at it or above it you don’t need to worry.
There are many great cards that you can get from other companies since Chase is the only one that has the 5/24 rule.
If you want to get into the Chase ecosystem, you will just have to wait a little while until some of the cards that you have get by that 24 month period.
Final Thoughts
The world of travel hacking can seem daunting since there are so many travel cards to choose from. It can give you paralysis by analysis when deciding where you should start.
I hope that I have helped you understand the importance of the Chase 5/24 rule. I also hope that I have given you a game plan as it comes to where to start when it comes to travel hacking.