The Chase 5/24 Rule Explained

One of the most important rules in travel hacking is the Chase 5/24 rule. Chase credit cards are the cornerstone of travel hacking so if they have any rules that can impact your travel hacking journey, they will be very important. The 5/24 is THE rule to know in travel hacking. Simply put, Chase will not approve you for a new credit card if you have opened 5 or more personal credit cards in the last 24 months. If you fail to follow this rule, you’ll likely miss out on some very important cards, at least for a while. In fact, this rule is so important that the question “what’s your 5/24?” is often the first question asked when you seek advice about the next card you should get.

There’s a lot of fascinating history behind this rule as Chase does not really acknowledge that it exists. Instead, travel hackers relied on talked to each other and sharing data to determine that this rule does in fact exist. They are the ones that dubbed it 5/24. Why Chase has this when other companies don’t is a mystery since Chase doesn’t even discuss it. The why is not important as long you understand that it exists.

Business cards

Of course, it’s not just as simple as understanding the basics of the rule. You have to understand where it all fits in and how it is going to shape what you do. The first thing you have to understand is that is does not apply to business cards. That’s kind of weird right? Why should there be a difference? Again, you’d have to ask Chase but you could open up 4 credit cards and then 10 business cards and still be under 5/24 (not that I would suggest doing that in less than 24 months). The other odd quirk here is that the 5/24 rule applies will prevent you from getting business cards once you are 5/24. Let’s go back to our other example. You are 4/24 and you decide to apply for a personal credit card. You then decide to apply for one business card. Guess what? You’ll be denied. In other words, Chase would be Ok with you having 4 personal cards and 3 business cards instead of having 5 personal cards and 1 business card. Does that make any sense? It sure doesn’t to me but it’s the way it is.

There are a few exceptions. Business cards issues by Discovery, TD Bank and Capital One (except the Spark Travel Elite and Spark Cash Plus) will count towards you 5/24.

It applies to all cards

Another thing to understand is that even thought this is just a Chase rule, it applies to all cards. So if you opened 5 Chase cards in the less than 24 months or 5 other credit cards in less than 24 months or a combination of Chase and other credit cards, you’re still 5/24. Thankfully Chase also has one of the best points programs out there so you’ll want to start with them anyway. That’s also why you’ll want to stick to Chase cards until you are 5/24.

Other things that don’t impact your 5/24 status

If you think Chase is concerned about your total credit outstanding, you’d be wrong as least as far as 5/24 goes. Auto loans, student loans and mortgages will not impact your 5/24 status. Again, this probably sounds a little odd. Store credit cards are a little bit of a gray area but travel hackers generally stay away from store credit cards so that should not even be a concern for you. Assume that they might and it’s just not worth it.

Other companies don’t care

So once you’re over 5/24 is when I would start encouraging people to start looking at other companies. While American Express might have an issue that you have a $100,000 total line of credit outstanding and only a $50,000 income (just as an example), they don’t really care if this is across 1 card or 100. American Express, Citi, Capital One, etc don’t have these rules so that’s why we usually suggest that you wait until you are 5/24 to get any other cards.

Tracking your 5/24 status

The best way to track your status is to get organized. As discussed in the 101 courses, keep a spreadsheet. List each card and include when you were approved for it. This will help you figure out when you will be back under 5/24. However, you should be applying for business cards which will space out your personal applications thus making it pretty easy to stay under 5/24 most of the time. For example, if you completed the Chase Trifecta in three months, it might take you the rest of the year to complete two business cards. So by the end of the first year, you are still 3/24. Even if you hit 5/24 six months later, you’ll fall back under 5/24 (assuming you don’t open any other personal cards) six months after that.

If you did not keep track of when you opened some cards, you can pull your credit report for free to check.

There are no other limits

Another odd things about the 5/24 rule is that there are no other limits. Some people have 20 cards, some have 30 and a few even have over 50 cards. So if you have 50 cards but all 50 are more than 2 years old, you’ll be 0/24. Pretty crazy huh? I mean at some point you’re gonna run into problems if you have too much outstanding credit relative to your income but you can always adjust that.

There’s a lot of things with this hobby that are a little quirky and 5/24 is certainly one of them (and the most important). You don’t have to understand the reasons why, you just have to understand what they are and how to handle them. This is why good credit card strategy matters.