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Discover it® card review

Discover it® card review

Published: April 19, 2018

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Ratings Policy
Balance Transfer Rating:
4.3 rating
4.3 rating
4.3 / 5
Introductory Offer: 4.7
Net Value: 3.6
Features: 2.0

In a nutshell:

A good value for cardholders who need to transfer a balance, but don’t want to give up earning new rewards, the Discover it 18-month balance transfer card pairs a generous balance transfer promotion with a solid first year bonus.

0% Introductory Period for Balance Transfers
18 months (See rates and fees)

Transfer Fee
3% (See rates and fees)

Introductory Purchase APR
0% for 6 months (See rates and fees)

Regular APR
13.49-24.49% (variable) (See rates and fees)

Annual Fee
$0 (See rates and fees)

Other Notable Features: Fraud protection, Discover Deals, free FICO® credit score, no penalty for first late payment, instant account freeze, 100% U.S.-based service, free social security number alerts

Cash Back Rating:
4.1 rating
4.1 rating
4.1 / 5
Rewards Value: 4.5
Annual Percentage Rate: 4.0
Rewards Flexibility: 4.1
Features: 2.0

In a nutshell:

The Discover it card offers a generous cash back rewards program that matches your cash back at the end of the first year as cream on top of its long 18-month period for balance transfers.

Rewards Rate

  • Enroll every quarter to earn 5% cash back on up to $1,500 in purchases in various categories throughout the year
  • 1% cash back on general purchases

Sign-up Bonus
Matches cash back at end of first year

Annual Fee
$0 (See rates and fees)

Average Yearly Rewards Value ($1,325 monthly spend)
$334

APR
13.49-24.49% (variable) (See rates and fees)

Rewards Redemption
Pros

  • Rotating categories
  • Redeem at any time
  • Redeem as gift cards, donations, credit to your account, direct deposit into any account, payment at select retailers

Cons

  • Enrollment required
  • Rotating bonus is limited to $1,500 in purchases per quarter

Other Notable Features: Fraud protection, Discover Deals, free FICO® credit score, no penalty for first late payment, instant account freeze, 100% U.S.-based service, free social security number alerts

Low Interest Rating:
2.2 rating
2.2 rating
2.2 / 5
Rates, Fees, Penalties: 2.1
Rewards: 3.8
Features: 2.0

In a nutshell:

Cardholders seeking to save on interest would be better served by a card with a longer 0-percent introductory period for new purchases.

Regular APR
13.49-24.49% (variable) (See rates and fees)

Introductory Purchase APR
0% for 6 months (See rates and fees)

Introductory Balance Transfer APR
0% for 18 months (See rates and fees)

Fees

  • No annual fee
  • 3% balance transfer fee
  • No foreign transaction fee
  • 5% cash advance fee (or $10, whichever is greater)
  • (See rates and fees)

Penalties

  • None for the first time you pay late. After that, up to $37
  • No penalty APR
  • Up to $37 returned payment fee
  • (See rates and fees)

Other Notable Features: Fraud protection, Discover Deals, free FICO® credit score, no penalty for first late payment, instant account freeze, 100% U.S.-based service, free social security number alerts

No Annual Fee Rating:
4.1 rating
4.1 rating
4.1 / 5
Rewards Value: 4.2
Annual Percentage Rate: 3.7
Rewards Flexibility: 4.7
Features: 2.0

In a nutshell:

For cardholders seeking a card with no annual fee, the Discover it card offers a long 0-percent introductory period for balance transfers and a great cash back program that matches your earnings in the first year.

Rewards Rate

  • Enroll every quarter to earn 5% cash back on up to $1,500 in purchases in various categories throughout the year
  • 1% cash back on general purchases

Sign-up Bonus
Matches cash back at end of first year

Annual Fee
$0 (See rates and fees)

Average Yearly Rewards Value ($1,325 monthly spend)
$334

APR
13.49-24.49% (variable) (See rates and fees)

Rewards Redemption
Pros

  • Rotating categories
  • Redeem at any time
  • Redeem as gift cards, donations, credit to your account, direct deposit into any account, payment at select retailers

Cons

  • Enrollment required
  • Rotating bonus is limited to $1,500 in purchases per quarter

Other Notable Features: Fraud protection, Discover Deals, free FICO® credit score, no penalty for first late payment, instant account freeze, 100% U.S.-based service, free social security number alerts

Rewards Rating:
3.7 rating
3.7 rating
3.7 / 5
Rewards Value: 3.3
Annual Percentage Rate: 3.8
Rewards Flexibility: 4.7
Features: 2.0

In a nutshell:

Though not as valuable as some points-based rewards cards, the Discover it’s cash back program is one of the best options for cardholders who prefer cash back rewards, thanks to its cash back match in the first year and rotating quarterly categories.

Rewards Rate

  • Enroll every quarter to earn 5% cash back on up to $1,500 in purchases in various categories throughout the year
  • 1% cash back on general purchases

Sign-up Bonus
Matches cash back at end of first year

Annual Fee
$0 (See rates and fees)

Average Yearly Rewards Value ($1,325 monthly spend)
$334

APR
13.49-24.49% (variable) (See rates and fees)

Rewards Redemption
Pros

  • Rotating categories
  • Redeem at any time
  • Redeem as gift cards, donations, credit to your account, direct deposit into any account, payment at select retailers

Cons

  • Enrollment required
  • Rotating bonus is limited to $1,500 in purchases per quarter

Other Notable Features: Fraud protection, Discover Deals, free FICO® credit score, no penalty for first late payment, instant account freeze, 100% U.S.-based service, free social security number alerts

Until recently, cardholders who needed to transfer a large balance to a new card, but still wanted to earn rewards, didn’t have a lot of options. Most balance transfer cards that offer a rewards program cap their balance transfer periods at 12 to 15 months. However, the Discover it balance transfer card is different: It gives cardholders a solid 18 months to pay off a transferred balance without accruing any interest – a deal that’s typically associated with plain vanilla cards that don’t offer any extras.

Like most Discover cards, the Discover it 18-month balance transfer card also offers a generous first year promotion that doubles your cash back at the end of the first year — a potentially lucrative offer for cardholders who regularly use their card for everyday purchases.

The Discover it card also offers an attractive cash back program that allows you to earn bonuses on the purchases you make most. The cash back program on the Discover it card can be a little high maintenance. But if you don’t mind tracking where you use your card, this is a great choice for everyday spending. Don’t confuse this card with the original Discover it card, though, which only offers 14 months for carrying a transferred balance interest-free. This is a separate offer for cardholders who qualify.

Lengthy balance transfer period

The biggest feature distinguishing the Discover it 18-month balance transfer card from other balance transfer rewards cards is its balance transfer promotion. You’ll be hard-pressed to find another rewards card that gives you so much time – a full year and six months – to pay off your transferred balance before the card’s standard rate kicks in.

Most competitors with similar promotions don’t offer any kind of rewards program and so they aren’t attractive candidates for using long-term. Instead, many people just stow their plain vanilla balance transfer cards away in a drawer until they pay off the transferred balance and either cancel them or let them linger in their wallets.

Affordable balance transfer fee

The Discover it 18-month balance transfer card also gets high marks for its balance transfer fee, which is on the low end for a balance transfer card. Cardholders are charged just 3 percent to transfer a balance. Some competitors, by contrast, charge fees as high as 4 to 5 percent – a difference that can add up to hundreds of dollars in extra charges.

If you have a large amount of debt to transfer, you may be better off sticking with a card that doesn’t charge a balance transfer fee at all. However, cards that don’t charge a balance transfer fee, such as the BankAmericard MasterCard or the Chase Slate card, don’t typically offer any rewards either. So if you’re set on earning some cash back, go with the Discover card.

Modest promotion for purchases

Unlike some competitors, the Discover it card doesn’t give you as long to carry a balance on new purchases, interest-free, though. If you don’t think you’ll be able to pay off your new purchases in full, you’ll probably want to put this card in a drawer until you pay off your transferred balance.

Cardholders get just six months to make interest-free purchases. That may give you enough time to pay down a big-ticket purchase you made early on before the card’s standard rate kicks in. However, it’s not much time to pay off a larger balance. If you continue to carry a balance on new purchases after the end of the six-month promotion, you may owe a significant amount of interest. The good news is that once you pay off all your debt and no longer carry any balances, this is an ideal card to use long-term.

Solid cash back program

A classic 5 percent bonus card, the Discover it card is a great card to have on hand when you run everyday errands, such as getting gas or dining out. The Discover it card allows you to enroll every quarter to earn 5 percent cash back on up to $1,500 in purchases made in various categories throughout the year, and 1 percent cash back on everything else.

Like other 5 percent cash back cards, the rotating bonuses are typically reserved for everyday purchases that you’re likely to make regularly, such as gas, restaurants, groceries and wholesale clubs, so it’s not hard to accrue bonuses. You can also use this card as a supplement to other rewards cards that offer bigger rewards during months when a particular spending category doesn’t earn a 5 percent bonus.

Some maintenance required

The downside to the Discover it card is that you have to pay attention to which card you’re using for certain purchases and proactively opt in to the bonus categories. If you don’t opt in before each quarter, you’ll earn just 1 percent on purchases.

To maximize your earnings, you also need to strategize a bit and shift your spending to correspond with the quarterly bonuses. For example, you might want to purchase gift cards from your local grocery store or favorite restaurants during the months that they earn a bonus. Or you may decide to delay certain purchases until they earn more cash back.

Excellent promotion

The Discover it card is very similar to the Chase Freedom card, which also offers 5 percent cash back on rotating categories, and gives cardholders 15 months to pay off a transferred balance interest-free. But its sign-up bonus is much more generous – especially if you regularly use your card for everyday purchases. Discover promises to match any rewards you earn at the end of the first year. So, for example, if you earn $200 worth of cash back by your card’s first anniversary, you’ll get $400 total – $250 more than the $150 bonus you’d earn with the Chase Freedom card.

Capturing such a large sign-up bonus is rare for a card without an annual fee. However, it’s practically unheard of for cards that offer such a lengthy balance transfer offer – or at least it was until the Discover it 18-month balance transfer card debuted.

Why get the Discover it 18-month balance transfer card?

  • You want to transfer a balance, but also want to earn rewards.
  • You need more than 15 months to pay off your old balance interest-free.
  • You want a cash back card for everyday spending, but also want to earn a large sign-up bonus.
  • You prefer cash back instead of travel or point rewards.

 How to use the Discover it 18-month balance transfer card:

  • Figure out how much you need to pay each month to knock out your balance in 18 months.
  • Only use your card for new purchases if you can afford to pay your new balance in full – and put additional money toward your transferred balance.
  • If you make a big purchase in the card’s first six months, try to pay it off before the card’s promotional period expires.

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