Discover it®: A 5% Contender?
The Discover it® offers some pretty enticing terms: high rewards, no annual fee and access to a killer bonus mall. But as an everyday card, it’s up against a tough slate of competitors. Let’s examine whether or not this is the right cash-back card for you.
|At a glance|
|0% APR promotions||0% on purchases and balance transfers for 14 months, and then the ongoing APR of 10.99% - 22.99% Variable, OR
0% on purchases for 6 months and 0% on balance transfers for 18 months, and then the ongoing APR of 10.99% - 22.99% Variable
|Balance transfer fee||3% of the amount transferred|
|Rewards program||Cash back|
|Verdict: It’s a good card, but the 5% cash-back field is very competitive.|
In this article:
The Discover it® basics
The Discover it® offers 5% cash back in rotating bonus categories, up to $1,500 spent per quarter. Here are the bonus categories for 2015:
- January – March: Gas and Ground Transportation
- April – June: Restaurants and Movies
- July – September: Summer Spruce Up and More
- October – December: Holiday Shopping and More
There are two versions of the card — one with 0% on purchases and balance transfers for 14 months, and then the ongoing APR of 10.99% - 22.99% Variable; the other with 0% on purchases for 6 months and 0% on balance transfers for 18 months, and then the ongoing APR of 10.99% - 22.99% Variable. Both versions come with:
- No foreign transaction fee or over-the-limit fee
- No penalty APR
- Free FICO score
- Waived first late-payment fee
|Discover it®||Discover it®|
|5% Cashback Bonus for gas and ground transportation on up to $1500 in purchases from Jan. through Mar. 2015 after you sign up for 5% Cashback Bonus. 1% cash back on all other purchases.||5% Cashback Bonus for gas and ground transportation on up to $1500 in purchases from Jan. through Mar. 2015 after you sign up for 5% Cashback Bonus. 1% cash back on all other purchases.|
|Intro APR Promo|
|0% intro APR on purchases and balance transfers for 14 months.||0% Intro APR for 18 months on balance transfers. 0% Intro APR for 6 months on purchases.|
Let’s compare Discover it® to other cards out there.
When to use the Discover it®
One of the best things about the Discover it® is the Discover Deals online bonus mall, which gives 5 to 20% cash back on popular online retailers, from Apple (5%) to ProFlowers (20%). In our comparison of online rewards malls, Discover trumps Chase’s Ultimate Rewards Mall and Citi’s Bonus Cash Center.
The next-best part of the Discover it® is the bonus category for the fourth quarter. Historically, it includes online shopping, so you can get great rewards on all of your holiday gifts. If you stack this on top of Discover Deals promotions, you’ll net even more cash back.
And finally, the Discover it® gives you free access to your FICO score and prints it on your monthly statement.
Discover it® vs. cash-back credit cards
The Discover it® is up against a series of 5% cash back heavyweights — like the Chase Freedom® and U.S. Bank Cash+™ Visa Signature® Card — as well as some pretty stellar flat rewards rate cards.
Discover it® vs. U.S. Bank Cash+™ Visa Signature® Card
on US Bank's
on US Bank's
The U.S. Bank Cash+™ Visa Signature® Card‘s annual fee is $0. It’s a great option if you don’t spend according to Discover’s bonus categories, and would rather choose your own.
Discover it® vs. Chase Freedom®
|Rewards limit||5% rewards capped at $1,500 per quarter|
|Jan-Mar||Grocery stores, movie theaters and Starbucks stores|
|Apr-Jun||Restaurants and more|
|Jul-Sep||Gas stations and more|
|Oct-Dec||Amazon.com and more|
There’s a case to be made for both the Chase Freedom® and the Discover it®. In the end, it will come down to your spending habits — think carefully about which bonus category schedule best fits your needs.
If it’s an option, you could get the Chase Freedom® and the Discover it®. They’ll both come in handy in the 4th quarter for holiday shopping. After that, you’re probably better off leaning on the Chase Freedom® for everyday use and turning to the Discover it® for access to Discover Deals.
Discover it® vs. Citi®Double Cash Card
The Citi®Double Cash Card has an annual fee of $0, no foreign transaction fees and an introductory APR of 0% on purchases and balance transfers for 15 months, and then the ongoing APR of 12.99% - 22.99% (Variable).
Discover it® vs. low APR credit cards
Discover it® vs. Citi Simplicity® Card
Discover it® vs. Chase Slate®
Image via iStock.