Discover offers a broad range of rewards credit cards that let you rack up cash back or miles for everyday purchases. None of the issuer's cards charge an annual fee, nor do they charge foreign transaction fees for purchases made abroad. The issuer also offers an easy-to-use rewards program, and that's true regardless of which card option you choose.
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Looking to earn cash back, gift cards, travel rewards or more? Keep reading to learn how the Discover rewards program works, which Discover credit cards fall under this program and how to use the rewards you earn.
The Discover rewards program is extremely flexible, especially when you consider all the different ways you can redeem your rewards. For the most part, Discover cash back credit cards let you redeem rewards for statement credits, cash back, gift cards, merchandise and charitable donations.
You can also sign up for Discover cards that let you earn "miles," although these miles work differently than airline miles. With Discover miles, you can redeem your rewards for any type of travel purchase you want. Simply cash in your miles to cover the purchase.
Discover cash back rewards are worth the exact cash back dollar value. For example, if your Discover cash back card lets you earn 1 percent back on all of your regular purchases, you would earn $1 in cash back for every $100 you spend on your card.
Discover miles that you earn with a Discover travel credit card are worth 1 cent each. This means if you rack up 10,000 in Discover miles, you can redeem them for $100 in travel purchases.
The Discover cash back bonus, known as Cashback Match, is a program that lets you earn a delayed welcome bonus. With the Cashback Match program, Discover will match all the rewards you earn in your first year as a new cardholder. For example, if you earn $300 in cash back during your first year, Discover will add another $300 to your rewards balance after the first year. If you earn 35,000 Discover miles, on the other hand, Discover will match that amount to 70,000 miles after the first year.
Generally speaking, anyone can earn the Cashback Match bonus on a Discover credit card. Just keep in mind this bonus applies to new accounts, and rewards are only doubled or "matched" on rewards you've earned during the first year. This means if you already have a Discover credit card that's more than a year old, you won't be eligible for Cashback Match. However, you can apply for a different type of Discover credit card and be eligible for Cashback Match.
There are quite a few Discover rewards credit cards, all of which are geared toward different types of consumers. The following are some Discover cards worth considering if you want to earn rewards without paying an annual fee.
The Discover it® Cash Back lets you earn 5 percent back on up to $1,500 spent in activated rotating bonus categories each quarter (then 1 percent) as well as 1 percent back on everything else. Discover will match all the rewards you earn at the end of your first year, plus there's no annual fee and no penalty fee for your first late bill payment. This card also comes with an introductory APR to cover new purchases and balance transfers.
For no annual fee, the Discover it® Miles card lets you earn 1.5X miles for each dollar you spend, and Discover will match all of the miles you earn at the end of your first year through its Cashback Match program. Your miles never expire, and you can redeem them for a wide range of travel purchases, merchandise, statement credits or cash back.
You'll also qualify for an introductory APR on both purchases and balance transfers, should you have a large purchase on the horizon or existing credit card debt to pay off.
Students who want to build credit should look into the Discover it® Student Cash Back, a no-annual-fee starter card that lets you earn 5 percent back on up to $1,500 spent in rotating bonus categories each quarter when activated (then 1 percent) as well as 1 percent back on all other purchases. All the rewards you earn at the end of your first year will be matched.
Additionally, new cardholders can take advantage of a short intro APR on both purchases and balance transfers (think: text book costs or dorm supplies).
The Discover it® Secured Credit Card is one of the top secured credit cards on the market today since it lets consumers build credit and earn rewards without paying an annual fee or hidden fees. For rewards, this card lets you rack up 2 percent back on up to $1,000 spent in combined purchases at restaurants and gas stations each quarter (then 1 percent) as well as 1 percent back on everything else.
Like other Discover cards, this card also qualifies for the Cashback Match program. Though the Discover it Secured doesn't feature an intro APR offer for new purchases, it does offer a short period for balance transfers.
Remember, however, that secured cards require you to put down a deposit as collateral, which is typically equal to the line of credit you qualify for. For this card, the minimum deposit you can make is $200 and the maximum limit is $2,500. So if you put down a $200 security deposit, you'll only start off with $200 in open credit you can use.
Your security deposit is fully refundable if you close your account without a balance and in good standing. Also, remember Discover will automatically review your account after seven months to see if you're eligible to upgrade to an unsecured credit line.
When it comes time to redeem your Discover card rewards, you'll find a wide range of options available to you. This kind of flexibility is helpful if you want to earn rewards but aren't sure how you'll use them, or if you want to travel but don't want to commit to a specific airline or hotel loyalty program.
When you're ready to redeem Discover card rewards, here are the redemption options you can choose from:
You can get cash back in the form of a direct deposit to your bank account or as a statement credit on your account. This option lets you redeem your rewards however you want. You can use your rewards to cover regular spending, bills, travel or some type of splurge.
You can redeem your rewards for a number of gift card options, which range from $5 to $200 and come in increments of $5. Many Discover gift card options also let you get more than 1 cent in value. Cardmembers can redeem their Cashback Match bonus for a partner gift card with 5 percent to 20 percent added value (depending on the merchant). You can see which partner gift cards qualify for more rewards by logging in to your Discover account.
You can use your rewards to pay for purchases on Amazon.com or via PayPal. This opens the door to a broad range of possibilities, whether you prefer to use your rewards to cover household essentials, like toiletries or home grocery delivery, or want to save your rewards for a splurge.
Can't decide how to use your rewards? Donate your rewards to a worthy cause or a charitable foundation that partners with Discover like the Make-A-Wish Foundation or ASPCA.
The Discover rewards program is a good option if you want to earn rewards without having to pay an annual fee for a credit card. In particular, Discover cash back cards tend to be popular among students and consumers who need to build credit.
However, there are rewards credit cards from different card issuers to consider. If you're looking to squeeze even more value out of your rewards, you should consider credit card rewards programs that let you transfer points to airlines and hotels or book travel through a portal. Or, for more rewards redemption options, check out other rewards programs like Chase Ultimate Rewards and American Express Membership Rewards.
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If you want a credit card that will reward you for every dollar you spend, and you don't want to pay an annual fee or follow complicated loyalty program rules, Discover's offerings are hard to beat.
Before you dive in, make sure to compare all your Discover credit card options - and explore other top-rated cards - to find the best option for your needs and spending habits.