Discover it: The OG Cashback Card - Still Relevant?
Alright, buckle up, cashback adventurers! Let's break down the Discover it Cashback card, because even points people (like Phillip from Points with Phillip) have to acknowledge its… interesting-ness.
So, why talk about a cashback card? Because it's POPULAR. Maybe you've got one chilling in your wallet right now. Let's see if it deserves a permanent spot!
The Nitty-Gritty: How it Works
5% Rotating Categories: This is the bread and butter. Every quarter, Discover serves up new categories (gas, groceries, Amazon, etc.) where you earn 5% cashback. BUT you HAVE to activate these each quarter. Don't be that person who forgets and misses out! (Phillip recommends Max Rewards Gold to automate this). The spend limit is $1,500 per quarter.
1% Base Rate: For everything else. It's not amazing, but it's there.
The Cashback Match: This is the REALLY juicy bit. At the end of your first year, Discover doubles all the cashback you've earned. Earn $200? They give you another $200. Boom!
Pros & (Potential) Cons
The Good Stuff:
No Annual Fee: A HUGE win. Low-risk, especially if you're new to credit cards.
Forgiving Lender: Good for those just starting to build credit.
Lucrative Categories: If you're organized and strategic, those 5% categories can really pay off.
The Not-So-Good Stuff:
Rotating Categories: A Pain?: You gotta track, activate, and adjust your spending. It's not a "set it and forget it" kind of card.
$1,500 Limit: If you're a big spender in those bonus categories, you might hit that limit fast.
Acceptance Issues: Discover isn't as widely accepted as Visa or Mastercard, especially internationally.
Discover it vs. Chase Freedom Flex: A Head-to-Head
These cards are like two peas in a pod! Both offer 5% rotating categories, activation requirements, and no annual fee. But here's the tea:
Chase Freedom Flex Advantages:
Fixed Bonus Categories: Offers some higher, baked-in rewards.
Retroactive Rewards: Activate by the 14th of the month in the quarter and still get the rewards.
Discover it Advantages:
No Foreign Transaction Fees: Chase Freedom Flex charges them!
Who is This Card For?
Beginners: A low-risk way to build credit.
Cashback Enthusiasts: If you love maximizing rewards and want no foreign transaction fees.
NOT For:
Lazy Spenders: If you want effortless rewards, this ain't it.
Points Junkies: You can't transfer these rewards to travel partners.
Frequent International Travelers: Acceptance can be an issue.
The Verdict?
The Discover it Cashback card is a solid option with cashback potential, especially in that first year with the match. But at the end of the day, Phillip's still a points guy!
Bonus Tidbit: Discover often has an APR bonus, like 18 months of 0% interest on purchases or balance transfers!
So, are you team cashback or team points?