For credit card users looking to get the most out of their rewards, the Discover it® Cash Back credit card should catch your eye. It offers a generous 0% intro APR period on purchases and balance transfers (then an ongoing 13.49% - 24.49% Variable APR), unlimited cash-back match after the first year and bonus rotating categories. The Discover it® Cash Back is the perfect step up from a basic rewards card, and beneficial for savvy cardholders willing to put in a little work to maximize their return on investment.
|Card||Ongoing Purchase APR||Annual Fee||Intro Bonus||Credit Needed||Key features|
|Discover it® Cash Back||13.49% - 24.49% Variable APR||$0||Automatic unlimited cash-back match by Discover after the end of the first year||Good to excellent||Cash back|
What we like about the Discover it® Cash Back
The Discover it® Cash Back is replete with valuable perks like a 14 months long 0% intro APR period on purchases and balance transfers (then an ongoing 13.49% - 24.49% Variable APR). That year-plus intro period is generous compared to other rewards cards, which typically offer only a year of 0% intro APR. If you’re planning on making a large purchase and you can pay off the balance within 14 months, you may want to consider this particular Discover card to pay it off slowly, without interest payments piling on to your overall debt.
At the end of your first year, another intro bonus kicks in: Discover will automatically match the cash back you earned, dollar for dollar, over those initial 12 months. There’s no cap on how much Discover matches, and you don’t need to sign up to receive this introductory offer.
The rewards structure is based around rotating quarterly spending categories where cardholders can receive 5% cash back up to the maximum spending limit for expenses like grocery stores, restaurants, gas stations, select rideshares and online shopping, up to the quarterly maximum when you activate. You also earn 1% cash back automatically on all other purchases with no cap.
This card has no annual fee, so you never have to worry about figuring out how to neutralize or compensate for an extra cost at the end of the year.
Things to consider
Not a fan of keeping track of rewards or managing which rewards category is active? The Discover it® Cash Back may not be for you if that’s the case. To maximize this card, it’s essential to monitor and activate the bonus rewards categories where you can get the biggest bang for your cash-back buck. Spending limits do apply, but when you go over the limit, you still keep earning at a rate of 1%.
Another note to keep in mind: Discover is not as widely accepted compared to Visa or Mastercard, so you may be more limited in terms of where you can use it. You’ll likely need a backup card in case a restaurant or other establishment doesn’t accept it.
Discover it® Cash Back cash back details
With the Discover it® Cash Back, cardholders earn 5% cash back in quarterly bonus categories on up to $1,500 in purchases at different places each quarter like grocery stores, restaurants, gas stations, select rideshares and online shopping, up to the quarterly maximum. But in order to receive that cash back, you’ll need to activate those the spending bonuses. After surpassing the $1,500 limit, you’ll still earn 1% cash back for that category and 1% back on all other purchases.
Cardholders have several options for cash-back redemption and rewards can be redeemed in any amount — except if you choose gift certificate redemption, which has a $20 minimum. Other redemption options include direct deposit, statement credits, donations to specific charities and even Amazon.com, where you can apply your cash back during checkout.
Discover it® Cash Back fees
For those credit card users who are fee-averse, you’ll be happy to learn this card boasts no annual fee and no foreign transaction fee. This means there isn’t a surprise charge at the end of the year and no extra costs for using your card abroad.
There is a 3% intro balance transfer fee, up to 5% fee on future balance transfers (see terms), which is a standard rate, not much better or worse than other cards on the market.
How does it compare to other cash back cards?
If you prefer a more straightforward rewards structure, a flat-rate cash-back card you don’t have to monitor might be a better choice. Credit card users who don’t want to worry about changing rewards categories may want to consider an alternative like the Citi® Double Cash Card.
For every purchase you make, you’ll earn 1% at the time of sale and 1% when you pay your credit card bill. There’s no annual fee, no cash-back limit and no bonus categories to track. However, the main drawback of this card is the lack of sign-on bonus. It also charges a 3% foreign transaction fee, so you may want to pass on this card if you are planning international travel.
The Chase Freedom® is another cash-back card offering consumers rotating rewards categories at an identical rate to the Discover it® Cash Back card. There’s also no annual fee and an intro offer of $150 cash when you spend $500 on purchases within three months of account activation. This is a good option if you’re looking for a faster cash-back reward instead of waiting until your first year is over to get Discover’s cash-back match.
The bottom line
The Discover it® Cash Back card is ideal for the strategic spender who wants to maximize rewards and takes the legwork to earn them in stride. The cash back rotating bonus structure, lack of fees and intro 0% APR on purchases and balance transfers for 14 months (then an ongoing 13.49% - 24.49% Variable APR) make this an excellent card to keep in your wallet longterm. Even after the intro period is over, it’s a worthwhile card for credit cardholders who want to play the rewards game.
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