Discover it®: A 5% Contender?
The Discover it® 12:12 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 for 12 months and 0% on balance transfers for 12 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® 12:12 basics
The Discover it® 12:12 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 for 12 months and 0% on balance transfers for 12 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® 12:12||Discover it® 6:18|
|5% cash back in categories that change each quarter up to the quarterly maximum when you sign up.||5% cash back in categories that change each quarter up to the quarterly maximum when you sign up.|
|0% on purchases for 12 months and 0% on balance transfers for 12 months, and then the ongoing APR of 10.99% - 22.99% Variable||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|
Let’s compare Discover it® 12:12 to other cards out there.
When to use the Discover it® 12:12
One of the best things about the Discover it® 12:12 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® 12:12 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® 12:12 gives you free access to your FICO score and prints it on your monthly statement.
Discover it® 12:12 vs. cash-back credit cards
The Discover it® 12:12 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® 12:12 vs. U.S. Bank Cash+™ Visa Signature® Card
If you want to choose your 5% categories, the U.S. Bank Cash+™ Visa Signature® Card is a great option. It offers 5% back on up to $2,000 in spending per quarter in two spending categories of your choice. The available bonus categories change each quarter. It also offers an unlimited 2% back on an everyday purchase category — like gas or groceries — and 1% back on everything else.
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® 12:12 vs. Chase Freedom®
The Chase Freedom® is a bit more traditional. It offers a sign-up bonus: Earn a $100 Bonus after you spend $500 on purchases in your first 3 months from account opening And like the Discover it® 12:12, it has 5% bonus categories that change quarterly. Here’s the 2015 bonus schedule:
|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® 12:12. 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® 12:12. 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® 12:12 for access to Discover Deals.
Discover it® 12:12 vs. Citi®Double Cash Card
Rotating bonus categories can be great, but if you’re looking for a card with a high, ongoing rewards rate, it doesn’t get much better than the Citi®Double Cash Card. You’ll earn 1% cash back on all your purchases, then an additional 1% cash back when you pay them off. This means that if you’re paying your balance in full every month, you can expect to reliably earn cash back at one of the highest levels out there for credit cards, without spending caps.
The Citi®Double Cash Card has an annual fee of $0, no foreign transaction fees and an introductory APR of 0% for 15 months on purchases and balance transfers, and then the ongoing APR of 12.99% - 22.99% Variable .
Discover it® 12:12 vs. low APR credit cards
Discover it® 12:12 vs. Citi Simplicity® Card
If you’re looking for a low-interest credit card, the Discover it® 12:12 isn’t your best option. The card with the longest 0% APR period is the Citi Simplicity® Card, which offers 0% for 21 months on purchases and balance transfers, and then the ongoing APR of 12.99% - 22.99% Variable . It also has no penalty APR and no late fees — ever. The Discover it® 12:12 does earn rewards, while the Citi Simplicity® Card doesn’t, but if you’re going to carry a balance, rewards rate shouldn’t be your focus.
Discover it® 12:12 vs. Chase Slate®
For an affordable balance transfer, the Chase Slate® can’t be beat. It offers 0% Intro APR for 15 months on purchases and balance transfers, and then the ongoing APR of 12.99% - 22.99% Variable. But the best thing about this card is that all balance transfers made in the first 60 days of opening your account are free. By contrast, the Discover it® 12:12 has a 3% transfer rate.
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