The Discover it® Cash Back is a no-annual-fee credit card that offers 5% cash back in categories that rotate quarterly, but only 1% cash back everywhere else and no substantive benefits. It can be a great addition to your wallet that can almost certainly increase the total rewards you earn with your credit cards—if you’re willing to take the small step of activating your card’s categories each quarter.
Discover it® Cash Back card at a glance
The Discover it® Cash Back card offers 5% cash back in Discover’s rotating quarterly categories and a dollar-for-dollar cash back match in your first year.
Discover it® Cash Back welcome offer
Welcome offer: Earn a $100 statement credit after you apply through a referral link and make your first purchase within 3 months of getting approved.
The $100 bonus is earned as a statement credit and the dollar-for-dollar cash back match is earned as additional cash back rewards.
Annual fee: $0
Rewards
- 5% on up to $1,500 in combined purchases in Discover’s rotating 5% categories each calendar quarter.
- 1% on all other purchases.
Rewards are earned as cash back, but can also be redeemed for gift cards. When you redeem for select gift cards, you’ll get better-than-cash-back value for your rewards.
Benefits
The Discover it® Cash Back card offers no substantive benefits.
Rates and fees
Annual fee: $0
Foreign transaction fee: None
Our quick take on the Discover it® Cash Back
Cards and Points Rating: 4.0/5.0
Read more about our star ratings.
If you like the game of chasing 5% rotating cash back categories, the Discover it® Cash Back card should be in your wallet. With the card, you can often get 5% cash back at places like drugstores, restaurants, gas stations, grocery stores, Target, Walmart, and Amazon—at least part of the year.
You probably won’t want the Discover it® Cash Back card to be the only card in your wallet—just getting a 2% cash back card can earn you double rewards outside of the rotating categories. Plus, we’re a bit disappointed by the card’s lack of benefits—other cards with no annual fee offer at least a basic extended warranty and purchase protection.
Pros
- 5% rewards in rotating categories
- Simple cash back rewards
- No annual fee
Cons
- No substantive benefits
- Only 1% rewards everywhere else
- Limited acceptance abroad
How to maximize the Discover it Cash Back card
The key to maximizing the value you get from the Discover it Cash Back card is in the card’s 5% categories. Simply put, if you activate your categories every quarter and use your card in its bonus categories, you’ll likely earn more in those categories than you will on the other cards in your wallet.
Also, remember that, in the first year of having the card, you’ll get a dollar-for-dollar cash back match on all of the rewards that you earn, so the card could also be your go-to-card for everything during your first year since it will earn as much in rewards as any other 2% cash back card. Not to mention that the cash back match means you’ll end up with a total of 10% in your categories.
That said, we wouldn’t recommend using the card outside of its 5% cash back categories, since you can earn more rewards everywhere with any no-annual-fee 2% card. Additionally, keep in mind that the Discover It card does not offer benefits like purchase protection and extended warranty. For expensive purchases where benefits like this matter, you might want to consider earning less rewards on another card that offers these benefits.
Using gift cards to expand your 5% category
One of our favorite tricks for maximizing 5% category cards is using gift cards to expand the category. Here are two ways you can do this.
Most grocery stores, drugstores, gas stations, home improvement stores and other types of retailers sell gift cards, which you can use to expand the Discover It’s 5% category bonus to other retailers.
For example, if the Discover It had gas stations as a 5% category (and you weren’t planning on spending $1,500 on gas during the quarter), you could pick up a gift card to Starbucks at a gas station, and effectively earn 5% on your Starbucks purchases.
You can also use gift cards to effectively move future purchases into the current quarter to earn 5%. Say you normally spend $300 on groceries each month and the Discover It is offering grocery stores as a bonus category. You could use your card for your normal $900 of grocery store spending during the quarter, but also buy a $600 gift card to use after the quarter’s category bonus ends. If you did that, you’d effectively earn 5% on a total of $1,500 of your grocery store spending.
How the 5% cash back categories work
If you’re new to the concept of 5% rotating category cards, here’s a quick overview on the Discover It’s categories work.
Every quarter, Discover publishes a list of 5% bonus categories, usually around the first of the month prior to the quarter start. For example, the bonus categories offered from April through June will typically be published around March 1st..
After Discover publishes its quarterly categories, you can go to Discover’s website or mobile app to activate your categories for the upcoming quarter. If you’ve already enrolled, you’ll see that you’re earning 5%. If you’re not enrolled, you’ll see a link to activate.
Discover will also send you an email where you can activate your categories with one click.
When you activate your bonus categories, you’ll earn 5% cash back on the first $1,500 you spend during the quarter in those bonus categories. Purchases beyond that $1,500 will earn 1%.
With the Discover It card, you must activate your categories prior to making your purchases. If you make a purchase without activating your quarterly categories, you will only earn 1% cash back for that purchase.
My experiences: A useful boost to my rewards
I use my Discover it® Cash Back cards (yes, I have two!) exclusively for their 5% rotating bonus categories.
Discover’s rotating bonus categories have historically included useful categories like grocery stores, gas stations, restaurants, wholesale clubs, Target, Amazon.com, select pharmacies, and digital wallet payments. Many times benefits like extended warranty don’t matter on these purchases. This card complements other 5% rotating category cards cards in my wallet like the Chase Freedom Flex℠ and the Citi Dividend Card.
Most often, I don’t plan on spending $1,500 in any given bonus category organically, but I will use gift cards to expand the category to other places I do shop. (See my comments above in the section on how to maximize for more on this.)
Outside of the card’s rotating bonus categories, the card doesn’t get much use.
Bottom line: 5% rotating categories can be a fun way to increase your rewards
Okay, we’ll admit that what the credit card rewards experts who write for this site think of as “fun” may not match what you think of as fun, but the Discover It can absolutely increase the total amount of rewards you earn form your credit card spending if you leverage its 5% cash back categories.
