How to Optimize Chase Freedom Flex, Discover it Cash Back for Q1 2023
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A new year means a new set of quarterly bonus cash-back categories for the Chase Freedom Flex℠ and eligible Discover cards, like the Discover it® Cash Back.
From Jan. 1 to March 31, 2023, cardholders will earn 5% cash back on up to $1,500 in combined quarterly spending in the following bonus categories:
Chase Freedom Flex℠
Fitness clubs and gym memberships.
Discover it® Cash Back and other qualifying Discover cards
Select streaming services.
Both cards earn 1% back after the $1,500 spending cap is met and on all nonbonus category purchases. (The Chase Freedom Flex℠ also has other bonus categories that are uncapped and fixed — not rotating.)
The rotating categories must be activated each quarter to qualify for 5% back. Chase cardholders can activate bonus categories online or in the Chase app by March 14, 2023, and bonus rewards can be earned retroactively (purchases during the quarter but prior to activation will still earn bonus rewards). For eligible Discover cards, bonus rewards can be earned starting from the date cash-back categories are activated online.
Here are some tips to maximize your 5% bonus categories this quarter.
Although the original Chase Freedom® card is no longer accepting applications, existing cardholders still earn 5% cash back based on the same bonus calendar and terms for the Chase Freedom Flex℠.
Optimizing the Chase Freedom Flex℠
Incentivize your fitness resolutions
If your New Year’s resolution includes getting in some exercise after the holidays, then Chase's Q1 bonus categories may be welcome news.
Chase Freedom Flex℠ cardholders can earn bonus cash back on fitness clubs and gym memberships, including national and local health clubs and exercise facilities requiring membership. Yoga, aerobic and CrossFit studios also qualify. This would be a perfect time to purchase a package or annual membership that can be used beyond this quarter, while locking in your 5% cash-back rate now.
One thing to note: Many fitness facilities sell merchandise or provide access to services like nutrition assessments, which might not earn bonus cash back. Individual businesses inside the fitness club — such as juice bars or coffee shops — might process transactions independently, so they also might not qualify for bonus cash back. It generally depends on what's known as the merchant category code. You can check your card statement to see how the vendor is classified to confirm you’ll earn those outsized rewards.
Buy groceries — or gift cards at grocery stores
Grocery stores are a bonus category for both Chase and Discover this quarter, and depending on what your resolutions are for 2023, "eating more healthy at home" could dovetail nicely with fitness club and gym memberships.
Be aware that purchases at Walmart, convenience stores and wholesale clubs like Sam’s Club or Costco won’t qualify as grocery store purchases. And while Target is its own 5% bonus category for Chase this quarter (see below), you can't double dip. That is, buying groceries at Target would earn you a maximum of 5% back, not 10% back.
If you happen to have both the Chase and Discover cards and know you might struggle to spend $1,500 on each card, note that most grocery stores sell third-party gift cards. You can head to the gift card rack, find a gift card for a retailer where you want to shop later and lock in that 5% rate now. Or you can purchase a gift card for your grocery store and use that throughout the year.
Hit your Target
This quarter, Target is a Chase bonus category for the first time. That means you can earn bonus cash back on everything from consumer electronics to clothing, cosmetics and more. Online and in-app purchases also qualify, so be sure to add your Chase Freedom Flex℠ card to your Target.com account and make it your default payment option.
Similar to grocery stores, Target also has an extensive gift card rack. If you aren’t able to maximize the spending cap at Target this quarter, think about perusing the available third-party gift cards for another retailer.
Chase Freedom® and Chase Freedom Flex℠ bonus rewards categories for 2023
Q1 (Jan. 1-March 31)
• Target. • Grocery stores. • Fitness clubs and gym memberships.
Q2 (April 1-June 30)
TBD (In 2022: Amazon.com; select streaming services).
Q3 (July 1-Sept. 30)
TBD (In 2022: Gas stations; car rentals; movie theaters; select live entertainment).
Q4 (Oct. 1-Dec. 31)
TBD (In 2022: PayPal; Walmart).
Optimizing the Discover it® Cash Back
This is the first time in five years that Discover has reverted to a quarterly release schedule for its bonus categories (rather than releasing the full annual calendar at the beginning of the year). While this may make it harder to plan your spending, savvy shoppers should still find a lot of value in the first-quarter bonus categories.
Load up on nonperishable items
For the fifth year in a row, Discover has selected grocery stores as a bonus category in the first quarter of the year, and you can apply these same strategies for the Chase Freedom Flex℠: Use your eligible Discover card to stock up on items with long shelf lives and/or essentials that you can stockpile. Just remember that purchases at warehouse clubs, Walmart and Target won't earn bonus rewards.
And while roaming your grocery store's aisles, consider purchasing gift cards to other retailers that you can use throughout the year.
Stock up on health care essentials
Need to refill that first-aid kit? Running out of toothpaste or over-the-counter medication? If so, hit up your local CVS, Walgreens or neighborhood drugstore.
Both online and in-person drugstores qualify, so if you’d rather shop from the comfort of your home, you can still enjoy those bonus rewards.
And similar to grocery stores, the major drugstores have gift card racks.
Every year, it seems there are more streaming services vying for our dollars. Whatever combination of streaming services you use, be sure to add your eligible Discover credit card as the default payment option. If there’s a particular service you plan to keep throughout the year, consider purchasing an annual subscription to lock in that bonus rate on the service even beyond the first quarter.
Note that streaming services bundled with another service, such as internet or a cell phone plan, may not qualify for the bonus rate.
Discover bonus rewards categories for 2023
Q1 (Jan. 1–March 31)
• Grocery stores*. • Drugstores. • Select streaming services.
Q2 (April 1–June 30)
• Restaurants. • Wholesale clubs.
Q3 (July 1–Sept. 30)
TBD (In 2022: Restaurants; PayPal).
Q4 (Oct. 1–Dec. 31)
TBD (In 2022: Amazon.com; digital wallets).
*The grocery stores category does not include grocery purchases at Walmart or Target or at other superstores or wholesale clubs.
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