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Is the Discover it Miles better for cash back or travel?

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When getting a travel credit card, you may think you have to choose between miles (or points) and cash for your redemption options. Many travel rewards cards offer boosted redemption rates for travel versus cash or other redemption options. However, the Discover it® Miles is unique in that you can redeem your miles for travel spending and cash—at the same rate.

But is it best to use your Discover it Miles rewards toward travel or cash back? Let’s talk about whether this card is better off as a travel or a cash back credit card.

Card details at a glance

  • Rewards rate: Unlimited 1.5X miles on all purchases
  • Welcome offer: All miles earned within the first 12 will be matched
  • Annual fee: $0
  • Purchase intro APR: 0 percent intro APR for 15 months
  • Balance transfer intro APR: 0 percent intro APR for 15 months
  • Regular APR: 12.24 percent to 23.24 percent (variable)

Card feature highlights

If you’re looking for a no-fuss way to earn and redeem your rewards for travel purchases or cash back, the Discover it Miles definitely fits the bill. It offers flat-rate rewards on your spending, meaning you don’t have to keep track of bonus categories or go through activation each quarter to start earning rewards. There’s no cap on how much you can earn back, and your miles never expire. Plus, there’s no minimum amount of miles you can redeem.

However, one standout feature makes this card especially unique for beginner travel cards. All miles earned within the first 12 months will be matched by Discover. So, if you end up spending, say, $25,000 on the card to earn 37,500 miles, Discover will match that amount, bringing your earnings to 75,000 miles for the first year. Whether you redeem them for cash or travel, that’s $750 worth of rewards you can earn in the first year of card ownership.

Earning rewards

As mentioned above, earning rewards is pretty straightforward—just swipe your card for all of your purchases and rack up rewards at 1.5X per dollar spent. Another way to earn rewards is by referring friends to open up a Discover credit card account. You can earn $100 for each friend you refer, up to five times a year, for a total of $500 in statement credits.

Redeeming rewards

Converting your miles to travel rewards is pretty simple. You’ll get a 1-cent-per-mile value, and you can redeem your miles for statement credits for eligible travel purchases made within the last 180 days. Discover’s broad definition of travel spending covers expenses like airfare, hotel stays, car rentals, travel website bookings, travel agents, commuter transit and gas stations. In addition, you can redeem miles for cash back or purchases made directly on Amazon.com or using PayPal.

Although Discover is not an issuer with a travel portal or travel partners available to boost the value of your miles, the card really shines in the area of simplicity and flexibility for redeeming your miles. Many travel credit cards penalize you for redeeming your rewards for cash or shopping. However, the Discover it Miles card gives you the same 1-cent-per-mile redemption option whether you redeem miles for travel, cash or a statement credit.

Other card perks and benefits

The Discover it Miles card has an introductory APR for purchases and balance transfers, which could help with a large purchase you’d like to pay over time or your efforts to pay down high-interest debt. After the intro APR period ends, you’ll have an 12.24 percent to 23.24 percent variable APR, depending on your creditworthiness.

There are almost no fees with the Discover it Miles card. So you won’t pay an annual fee or foreign transaction fees, and Discover waives your first late fee if you fail to make the minimum payment by the due date.

The low cost of ownership with this card is a plus, but it also means many common travel credit card benefits are lacking. There aren’t any travel protections like trip delay insurance, rental car coverage or special concierge services with your Discover it Miles.

Is it better to redeem my miles for cash back or travel?

Because your redemption value is a flat 1 cent per mile, you really can’t go wrong either way. If we were talking about a card like the Chase Sapphire Preferred® Card, the answer would be much different.

The Sapphire Preferred offers a 25 percent bonus on points redeemed for travel in the Chase Ultimate Rewards travel portal and 1 cent per point for cash, making your travel redemption with this card a better deal. However, you might skip out on this card because of the $95 annual fee.

However, if you want to ease into an advanced award travel strategy, another approach would be to get the Chase Freedom Unlimited® which offers 1.5X rewards on all purchases plus boosted rates on bonus categories. Once you’re ready, pair it with one of Chase’s more premium cards—like the Chase Sapphire Preferred—to pool Ultimate Rewards points and redeem them for 25 percent more on travel purchases.

Credit card pairing strategies can definitely help you boost your earning and redemption rates for award travel, but they can be slightly more involved. If you are looking for a simple, no-annual-fee, low-maintenance travel rewards card, the Discover it Miles could be a good start.

The bottom line

If you’re vying for a respectable yet decent entry-level travel card, the Discover it Miles card is worth a look. While the card isn’t the most luxurious travel credit card out there, it does have some pretty neat features, like the first-year miles matching, that make it great for someone starting out on their awards travel journey.

Written by
Aja McClanahan
Personal Finance Writer
Aja McClanahan is an author, blogger and speaker on personal finance and entrepreneurship. Aja is the author of "How a Mother Should Talk About Money with Her Daughter."
Edited by
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