The Discover It card offers an enticing sign-up bonus that can significantly enhance your initial experience with the card. Discover matches all the cashback you earn in your first year with no minimums or limits. For instance, if you earn $300 in cashback, Discover will add another $300. Additionally, there’s a limited-time $100 bonus when you sign up and make a purchase within the first three months using a referral link. This feature is particularly appealing as it allows you to maximize your rewards right from the start.
Zero Interest Period
One of the standout features of the Discover It card is its zero-interest period. For the first fifteen months, you can enjoy zero interest on purchases and balance transfers. This is particularly beneficial if you’re planning a big purchase or looking to transfer debt from a high-interest credit card. However, it’s crucial to note the 3% balance transfer fee, which should be weighed against potential savings. After the fifteen months, the regular interest rate applies, so it’s wise to have a plan to pay off your balance before this period ends.
Rotating Cashback Categories
The Discover It card offers 5% cashback in rotating categories each quarter, such as grocery stores, restaurants, and gas stations, on up to $1,500 spent per quarter. For example, in the first quarter of 2024, the categories include restaurants and drugstores. In subsequent quarters, categories like gas stations, EV charging stations, and home improvement stores are featured. To earn these rewards, you must activate the categories each quarter, a process that’s quick and straightforward.
Maximizing Your Cashback
To maximize the benefits of the Discover It card, it’s advisable to focus spending on the 5% categories. In your first year, thanks to the cashback match, you effectively earn 10% cashback in these categories and 2% on all other purchases. With no annual fee, this card offers substantial value, especially during the first year.
Additional Features and Benefits
Beyond rewards, the Discover It card boasts several attractive features. It charges no foreign transaction fees, making it a great choice for international use. It also offers protection against unauthorized purchases and free access to your FICO score. Discover is renowned for its excellent customer service, available 24/7 via chat, email, or phone. A unique feature is the ability to choose from over 150 card designs, allowing personalization without changing your card number.
Preapproval Process
The Discover It card allows for a preapproval process with just a soft pull, meaning your credit score won’t be affected. This feature is beneficial for those unsure of their approval chances, as it provides an idea of potential interest rates and credit limits without impacting your score. However, accepting a credit card offer will result in a hard pull, affecting your score by a few points.
Redemption Options
Redeeming cashback with the Discover It card is flexible and straightforward. Options include a direct deposit into your bank account, a statement credit, or using cashback for purchases on Amazon or PayPal. Gift cards can also be purchased, often providing additional value. For instance, $20 cashback might be exchanged for a $25 or $30 gift card at select merchants.
Credit Score Requirements
The recommended credit score for approval is 670 or higher, though a higher score increases your chances. Discover may check your score with any of the three major credit bureaus. During my application in 2022, my score was 768, my income was between $60k to $100k, and my credit utilization was 2%. Discover checked my score with Experian and approved me with a $10,000 credit limit.
Requesting a Credit Limit Increase
If the initial credit limit isn’t sufficient, Discover allows for credit limit increase requests with a soft pull, meaning it won’t affect your credit score. It’s advisable to use the card responsibly for about six months before requesting an increase to improve your chances of approval.
Potential Downsides
While the Discover It card offers many benefits, there are potential downsides. The 5% cashback categories are capped at $1,500 per quarter, after which the rate drops to 1%. This limit might be restrictive for high spenders. Additionally, the need to activate bonus categories each quarter might be seen as a hassle by some, though it only takes a few seconds.
Another downside is that the bonus categories might not align with your spending habits. For instance, if you don’t frequently use gas stations or home improvement stores, maximizing your rewards could be challenging. The card also offers 1% cashback on all other purchases, which is lower than some other cards that offer a flat 2% cashback rate.
Redemption Value
While the redemption options are varied, their value is largely uniform, which might not appeal to those looking to maximize rewards for travel. This card is primarily a cashback card, so if travel rewards are a priority, another card might be better suited to your needs.
Is the Discover It Card Worth It?
Despite the potential downsides, the Discover It card offers significant value, especially in its first year. The 5% rotating categories, generous sign-up bonus, and no annual fee make it an attractive option for many. The decision ultimately depends on your spending habits, existing cards, and preferred reward types.
For those who can capitalize on the rotating categories and appreciate the card’s features, the Discover It card is a strong contender in the cashback card market. If you’re considering it, take advantage of the sign-up bonus and zero-interest period to maximize your benefits.
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