Business

Discover it Cash Back Review

Posted July 12, 2018 3:06 p.m. EDT

The Discover it® Cash Back is a great $0 annual fee card that provides a quarterly rotating cashback program where you can benefit from various 5% bonus categories. You may not benefit from all the categories, but there’s a good chance at least one quarter’s categories will suit your spending. This card also has many of the perks Discover is known for, including no foreign transaction fees and no penalty APR, which add value beyond the cashback program.

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Rates & Fees

Discover it® Cash Back

Annual fee$0Intro Purchase APR0% for 14 monthsRegular APR13.74% - 24.74% VariableRewards Rate5% cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com, or wholesale clubs up to the quarterly maximum each time you activate. 1% unlimited cash back automatically on all other purchases.Credit requiredgood-creditExcellent/Good Credit

In this review, we will cover:

Breaking down the rewards

    What we like about this card

      What to watch out for

        What other cards should I consider?

          Bottom line

            Breaking down the rewards

            This card offers a cashback program where you can earn 5% cash back at different places each quarter — like gas stations, grocery stores, restaurants, Amazon.com, or wholesale clubs — up to the quarterly maximum each time you activate. You earn 1% unlimited cash back automatically on all other purchases.

            The quarterly maximum is $1,500, allowing you to earn up to $75 cash back in the 5% cashback categories each quarter. Purchases exceeding $1,500 in the bonus categories earn an unlimited 1% cash back.

            This card also comes with a new cardmember offer where Discover will automatically match all the cash back you earn at the end of your first year. So, if you earn a total of $200 cash back during your first 12 consecutive billing periods, Discover will match it and apply your cash back within the next one to two billing periods.

            What are the 5% cashback categories?

            • January – March 2018 – Gas Stations & Wholesale Clubs
            • April – June 2018 – Grocery Stores
            • July – September 2018 – Restaurants
            • October – December 2018 – Amazon.com & Wholesale Clubs

            What can cash back be redeemed for?

            • Statement credits
            • Direct deposits
            • Gift cards starting at $20 (with at least $5 free added to each card)
            • Purchases at Amazon.com when you pay with rewards
            • Donations to charity

            How do I activate the 5% cashback categories?

            There is no automatic activation — you’ll have to either manually log in to your account and activate or call 1-800-DISCOVER (1-800-347-2683). And while you may worry about forgetting to activate the 5% cashback categories, Discover makes the process a bit less stressful by providing plenty of time for you to activate. You typically can activate two months before the new 5% cashback categories start. For example, if you want to utilize the 5% cashback categories for October-December, you can activate starting August 1st. Plus, you can sign up for email alerts and push notifications via the Discover app.

            Does cash back expire?

            No, cash back doesn’t expire. If your account is closed or if you haven’t used it within 18 months, Discover will credit your account with any cash back remaining.

            What we like about this card

            The chance to pay for new purchases over time or get out of debt. If you plan on making new purchases that you can’t pay by your due date, or if you have a balance on a non-Discover card, this card provides you the opportunity to avoid interest charges. There is an intro 0% for 14 months on purchases and an intro 0% for 14 months on balance transfers. After the intro periods end, a 13.74% - 24.74% Variable APR applies. Take note: the fee for balance transfers is 3%, which is typical; however, there are also cards with intro $0 balance transfer fees.

            No fee on your first late payment. If you miss a payment, don’t fret about incurring a late fee —  Discover waives your first late payment fee. Use this as a reminder to set up autopay or payment reminders.

            No penalty APR: If you pay late, your interest rate won’t increase, unlike other cards that may charge penalty APRs near 30%. 

            No foreign transaction fee. This card doesn’t charge the typical 3% fee some other cards charge on purchases made outside the U.S.

            What to watch out for

            13.74% - 24.74% Variable APR. While this APR range is typical of credit cards, it’s not ideal if you’re someone who carries a balance month-to-month. You can find other low interest credit cards that provide lower APR ranges and are better suited for people who carry balances.

            What other cards should I consider?

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            Citi® Double Cash Card – 18 month BT offer

            Annual fee$0*Intro BT APR0% for 18 months on Balance Transfers*Balance Transfer Fee3% of each balance transfer; $5 minimum.Regular Purchase APR15.24% - 25.24%* (Variable)Rewards RateEarn 2% cash back on purchases: 1% when you buy plus 1% as you payCredit requiredgood-creditExcellent, Good

            The Citi® Double Cash Card – 18 month BT offer is a great flat-rate cashback card. Compared to the Discover it® Cash Back, which has quarterly rotating categories, you earn the same cashback rate on all purchases — Earn 2% cash back on purchases: 1% when you buy plus 1% as you pay. This is a straightforward way to earn cash back, and you don’t have to worry about activating bonus categories. Additional perks of this card include Citi® Private Pass®, where you can get exclusive access to various entertainment events, and Citi® Price Rewind, which conducts a 60-day search for a lower price on eligible items you register, potentially giving you the difference if a lower price is found (up to $500 back per item, and up to $2,500 per year).

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            Citi Simplicity® Card - No Late Fees Ever

            Annual fee$0*Intro Purchase APR0%* for 18 months on Purchases*Intro BT APR0%* for 18 months on Balance Transfers*Regular Purchase APR15.74% - 25.74%* (Variable)Balance Transfer Fee5% of each balance transfer; $5 minimumCredit requiredgood-creditExcellent/Good

            The Citi Simplicity® Card - No Late Fees Ever is a good alternative to the Discover it® Cash Back if you’re looking to finance new purchases. There is an intro 0%* for 18 months on Purchases*, which can help you pay off purchases over time without accruing interest. After the intro period ends, a 15.74% - 25.74%* (Variable) APR applies. While there are no rewards, this card has less fees than typical credit cards — there are no late fees and no penalty APR. Although this can be helpful if you forget to pay a bill, we encourage you to always make on time payments so you don’t rack up interest charges.

            Bottom line

            If you don’t mind activating quarterly bonus categories, the Discover it® Cash Back is a great choice for a $0 annual fee cashback card. Plus, you can benefit from the unique new cardmember offer in which Discover will automatically match all the cash back you earn at the end of your first year.

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