Discover it® Cash Back Review: Earn 5% back

Discover’s premier cash-back credit card makes earning rewards easy and lucrative. The Discover it® Cash Back card gives you 5% on qualifying purchases, ongoing rewards on everything you buy, and the potential to “double your rewards” after 12 months. You also get a special promotional offer with this Discover card on balance transfers and purchases, making this a solid card to pay down debt.

Whether you want to pursue rewards or use the Discover it® Cash Back as a vehicle for low interest debt repayment, you should know all the details on how this card works.

Who should get the Discover it® Cash Back?

The Discover it® Cash Back is perfect for consumers who want to earn cash back rewards on their regular purchases without an annual fee. Once you sign up for this card, you’ll earn 5% back on up to $1,500 spent in rotating categories each quarter according to the cash back calendar when you activate them. While these categories change every year, the remainder of 2019 has already been decided. From July through September, bonus categories include restaurants and Paypal. October through December of 2019 lets you earn 5% cash back u on all purchases made on Amazon.com, Target.com, or Walmart.com just in time for holiday shopping. Just remember that you have to enroll your card to earn 5% back every quarter; the cash back bonus doesn’t happen automatically.

On top of bonus earnings, you’ll score 1% back on all new purchases you make. More important, however, is the fact Discover will double all the rewards you earn by the end of your first year.

Imagine for a moment you could max out each quarter’s bonus earnings for a full $75 back four times per year. On top of that, you could spend $1,000 per month — or $12,000 per year — on regular purchases. At the end of 12 months, you will have earned $420 in cash rewards — a sum Discover would double to $840 in rewards.

This Discover rewards card makes redeeming rewards easy since you can opt for statement credits, gift cards, and merchandise. Other reasons to get the card include the fact there are no foreign transaction fees, and you get free access to your FICO score on your statement each month. You also receive free Social Security number alerts and dark web site monitoring that can help you prevent identity theft.

Finally, the Discover it® Cash Back can be a smart card to apply for if you have expenses that you need to pay off without interest for a period of time— or if you have high interest credit card debt to transfer a balance from. Once you are approved, you’ll get an intro offer of 14 months with 0% APR on purchases and balance transfers, then 13.74% to 24.74% variable APR. Just remember that a 3% balance transfer fee applies until October 10, 2019; after that, the fee surges to 5%.

Where the Discover it® Cash Back comes up short

So, what’s the catch? There’s really not one, provided you don’t mind waiting 12 months to earn a welcome bonus. This Discover it card doubles all the cash back rewards you earn after the first year, but you have to wait 12 months to receive the rush of points. This is unlike some other rewards credit cards that give you an initial welcome bonus when you meet a minimum spending requirement within the first 3 months.

Another potential downside of the Discover it® Cash Back is the fact you can’t really redeem your points for travel rewards. You can cash in points for statement credits to cover travel expenses, yes, but you can’t use your rewards to book travel through a portal or transfer them to hotel and airline partners.

Other than these two details, there’s not much to complain about with this card.

How to use the Discover it® Cash Back

Heard enough and ready to apply? Make sure you have a plan to leverage your credit card to the hilt. The first thing you should know is that debt repayment and rewards don’t really mix — at least not well. In short, this means you should use your Discover card to save money on interest or to earn rewards, but not really both.

If you have high interest credit card debt, you should:

  • Apply for the Discover it® Cash Back and transfer your balances over before October 10, 2019 to score a 3% balance transfer fee. After that, up to 5% fee on future balance transfers.
  • Pay off as much debt (or all your debt) as you can during the first 14 months while you have 0% intro APR (then 13.74% to 24.74% variable).
  • You can also use the credit card for a large purchase and pay it down slowly over time with no interest during the intro period, helping your credit score with regular, on-time payments.
  • Whether you’re transferring debt over or using your card for an expensive purchase you want to pay off over time, it’s important to keep one key factor in mind. Once 14 months is up, your rate will reset to the higher standard interest rate this credit card offers.

No debt? That’s awesome. If your goal is using this card to earn rewards, you should:

  • Apply for the Discover it® Cash Back and use it for all your regular purchases, both online and when you checkout in person.
  • Keep tabs on the rotating bonus categories (like gas stations, grocery stores, etc) so you can maximize them when they align with your spending needs.
  • Make sure to enroll into each quarter’s 5% earnings so you don’t miss out.
  • Pay your credit card bill in full each month to avoid interest.

The bottom line

This credit card can be a useful tool if you want to pay down debt or earn rewards, but you should have a plan before you hit the apply now button. Also make sure to consider other cash-back credit cards and balance transfer credit cards. You may find the Discover it® Cash Back is ideal for your needs, but explore other offers from Discover and other card issuers first.

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