When it comes to building a credit card portfolio, just about anyone will tell you that you need to start with Chase, due to their 5/24 rule. The 5/24 rule of course states that you cannot have more than 5 credit cards from any issuers in a 24 month period. If you have 5+ new accounts in that timeframe, you will not be approved for a card from Chase, and you’ll have to wait until those cards are older than two years.
There is another hurdle for you to jump over if you want some Chase cards. That rule is your average age of accounts need to be over a year old, otherwise, again, Chase will not approve you for a card. What if you are new to credit? Chase has no form of secured or student card so you had no choice but to acquire a few other cards to build up your credit to be good enough for Chase. The problem is that doing so takes up a few of those 5/24 slots.
The Student Card
Chase has offered some relief for people stuck in that predicament. This comes in the form of Chase offering a student credit card! The card is called the Student Freedom card.
Unlike the name would imply, it does not give its users 5% on rotating categories. It will reward 1% on all purchases instead. The card is not a secured card, and there is also no annual fee for having the card. As far as a sign up bonus, you get $50 when you make your first purchase on the card within the first 3 months. If you keep the account in good standing, you will receive $20 per year for a maximum of 5 years.
With Chase’s 5/24 and average age of accounts needing to be more than 1 year, it was difficult for people with no/new credit to get Chase cards. Unlike most other credit card issuers, there wasn’t a secured or student card that people could apply for to start their relationship. Now we finally see a way for new people to get into Chase’s system early on.
What do you think about Chase finally introducing a student credit card? Let us know below!