Discover rewards program guide

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Discover offers a broad range of rewards credit cards that let you rack up points for travel, cash back and more. Their cards don’t charge an annual fee, nor do they charge foreign transaction fees for purchases made abroad. Discover even offers credit cards that help consumers build credit, including their award-winning secured credit card that offers cash back rewards.

The Discover rewards program is easy to use, and that’s true regardless of which of their card options you choose. If you’re hoping to earn cash back, gift cards, statement credits or rewards for travel, keep reading to learn how the Discover rewards program works, which Discover credit cards fall under this program and how to use them.

How does the Discover rewards program work?

The Discover rewards program is extremely flexible. Considering there are several ways you can redeem points the rewards rack up. In summary, Discover cash back credit cards let you accumulate rewards good for statement credits, cash back, gift cards and more. 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 you want, then you just cash in your miles to cover the purchase after the fact.

How much are Discover rewards worth?

Discover cash back rewards are worth the exact dollar value offered in cash back. If your Discover cash back card lets you earn 1 percent back on all your regular purchases, for example, you would rack up $1 in cash back for every $100 you spent.

Discover miles that you earn with a Discover travel credit card are also worth one cent each. This means if you rack up 10,000 in Discover miles, you can redeem them for $100 in travel purchases.

How does the Discover Cashback Bonus work?

The Discover Cashback Bonus, which is also known as Cashback Match, is a program that lets you earn a delayed welcome bonus of sorts with Discover rewards credit cards. With the Cashback Match program, Discover will match all the rewards you earn in your first year as a new cardholder.

If you earn $300 in cash back during your first 12 months as a cardholder, Discover would add another $300 to your rewards balance after 12 months. If you earned 35,000 Discover miles, on the other hand, Discover would match that amount to 70,000 miles after 12 months.

Best Discover credit cards for 2020

There are quite a few Discover rewards credit cards, all of which are geared toward different types of consumers. The following cards are some of Discover’s best options, and each one could be worth considering if you want to earn rewards without an annual fee.

Discover it® Cash Back: Best for cash back rewards

The Discover it® Cash Back lets you earn bonus rewards in popular categories, as well as a standard rewards rate on everything else you buy. Specifically, you’ll earn 5 percent back on up to $1,500 spent in rotating bonus categories each quarter (then 1 percent) as well as 1 percent back on everything else (activation required). Discover will match all the rewards you earn after the first 12 months, and there’s no annual fee and no fee the first time you pay your bill late.

As an added bonus, this card comes with zero percent intro APR on purchases and balance transfers for 14 months, followed by a variable APR of 11.99 percent to 22.99 percent.

Pro tip: If you’re curious about which categories you can earn 5 percent back in right now, make sure to check out the Discover it Cash Back Bonus calendar for 2020.

Discover it® Miles: Best for travel

The Discover it® Miles earns you 1.5X miles for each dollar you spend, and Discover will match all the miles you earn after your first 12 months through their Match program. Your miles never expire, and you can redeem them for travel purchases charged to your account or for statement credits or cash back in your bank account. This card doesn’t charge an annual fee, and you’ll qualify for zero percent intro APR on purchases for 14 months, followed by a variable APR of 11.99 percent to 22.99 percent.

Discover it® Student Cash Back: Best for students

Students who want to build credit should look into the Discover it® Student Cash Back, which lets you earn cash back rewards without an annual fee. This student credit card gets you 5 percent back on up to $1,500 spent in rotating bonus categories each quarter (then 1 percent) as well as 1 percent back on other purchases (activation required). You’ll also see all your rewards matched after the first 12 months of account membership. There’s no annual fee, and you can even qualify for a $20 Good Grade Reward statement credit each year (for up to five years) if your GPA is 3.0 or higher.

Finally, new cardholders will pay zero percent intro APR on purchases for six months, followed by a variable APR of 12.99 – 21.99 percent.

Discover it® Secured: Best for building credit

The Discover it® Secured is one of the top secured credit cards on the market today since it lets consumers build credit and even earn rewards without an annual fee or hidden fees. This card lets you rack up 2 percent back on up to $1,000 spent on restaurant and gas station spending each quarter (then 1 percent) as well as 1 percent back on everything else. Like other Discover cards, this card also qualifies for the Discover Cashback Match program that matches all rewards earned after your first 12 months as a new cardholder. You won’t pay an annual fee, and you’ll get a free FICO score each month.

Just remember that secured cards require you to put down a deposit as collateral, which is typically equal to the line of credit you qualify for. This means that you must be able to put down a $200 security deposit, and you’ll only start off with $200 in open credit you can use.

Discover it® Business: Best for business owners

Small business owners and solo entrepreneurs can consider the Discover it® Business Card for all their business spending. This business credit card doesn’t charge an annual fee, yet you’ll earn 1.5 percent cash back for each dollar you spend. Discover will match all the rewards you earn after the first 12 months, and you don’t have to pay a separate fee for employee cards.

You also get a free FICO score each month, and you’ll qualify for zero percent intro APR on purchases for 12 months, followed by a variable APR of 12.99 percent to 20.99 percent.

Redeeming Discover rewards

When it comes time to redeem your Discover rewards, you’ll find a wide range of options available to you. This kind of flexibility is helpful when you want to earn rewards but aren’t sure how you’ll use them, or if you may want to travel but don’t want to commit to a specific airline or hotel loyalty program.

Here are the redemption options you can choose from once you’re ready to redeem Discover rewards:

Cash back

Get cash back deposited in your bank account at any time, or opt for a statement credit on your account. This option lets you redeem your rewards however you want, whether you prefer to use rewards to cover regular spending and bills or to save them up for travel or some type of splurge.

Gift cards

You can also redeem your rewards for a wide range of gift card options starting at just $5. Many Discover gift card options also let you get more than 1 cent per point in value.

Pay with rewards

You can also use your rewards to pay for purchases directly on Amazon.com or for things you buy using PayPal.

Charity

Can’t decide how to use your rewards? Donate your rewards to a worthy cause or charitable foundation that partners with Discover.

Is the Discover rewards program right for you?

The Discover rewards program is a good option if you want to earn cash back and other rewards without having to pay an annual fee. Discover cash back cards are also popular among consumers who need to build credit or those who want a card geared specifically toward students or business owners.

However, there are other rewards credit card options to consider from different card issuers, including credit card rewards programs that let you transfer points to airlines or hotels or book travel through a portal.

If you want to have as many ways as possible to redeem your rewards, make sure to also check out other rewards programs like Chase Ultimate Rewards and American Express Membership Rewards.

The bottom line

If you want a card that will reward you in some way for every dollar you spend without annual fees or complicated loyalty program rules, Discover’s offerings are hard to beat.

Before you dive in, make sure to compare all the best Discover credit cards to find the perfect option for your needs and spending style.

The information about the Discover it® Business has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.