Discover it® Student Cash Back review: Elevated cash back for the go-getter student

Both of these Discover student credit cards offer solid rewards, benefits and rates, but they have different cash back programs. Instead of rotating bonus categories, the Discover it® Student Chrome card earns 2 percent cash back at gas stations and restaurants on up to $1,000 in combined purchases each quarter (then 1 percent) and 1 percent cash back on all other purchases.

Choosing between these two Discover cards comes down to your budget and how much effort you want to put in to earn more rewards. The Discover it® Student Chrome might be a better choice for students who don’t want to track activation periods and quarterly bonus categories. But unless your budget would earn more cash back from year-round gas station and restaurant categories, the Discover it® Student Cash Back card might still be the stronger card thanks to its higher rewards rate and higher quarterly bonus spending cap.

The Capital One SavorOne Student Cash Rewards Credit Card has the potential to be more rewarding than the Discover it® Student Cash Back — and is much easier to use. For no annual fee (See Rates & Fees for the SavorOne Student), you’ll earn a whopping unlimited 3 percent cash back on popular everyday categories, like dining, entertainment, popular streaming services and grocery stores (excluding superstores like Walmart and Target). You’ll also get an 8 percent cash back on Capital One Entertainment purchases.

Since it’s probably hard to maximize rotating categories on a student’s budget, the SavorOne Student is likely more rewarding than the Discover it® Student Cash Back, but it’s a close call. The SavorOne has static bonus categories that students may use often, while the Discover typically announces its bonus categories a quarter in advance, making it difficult to plan on maximizing your cash back ahead of time.

However, the Discover it® Student Cash Back has a big leg up if you think you may carry a balance. The SavorOne Student poses a higher variable APR with no zero-interest APR offers. So the Discover it® Student Cash Back would be far more cost-effective if you think you may need some time to pay off any emergency expenses that pop up.

Discover designed this card with students in mind, since you are eligible to apply without a credit history. Students who want experience in carrying a credit card and paying off a monthly balance should consider this card, especially if they are holding down a job at the same time. 

You must be enrolled in a two-year or four-year college or university. As part of the application process, you must provide your Social Security number, college enrollment details, source of income and other personal information. Part-time students also qualify.

While student credit cards are primarily meant for young adults just establishing their credit score, you can apply for this student credit card even if you're a nontraditional student returning to college. There's no age limit.

This aspect can be helpful if you're enrolled at a college but you want better rates and benefits than secured credit cards typically offer. Keep in mind that the Credit CARD Act of 2009 states that if you’re younger than 21, you must be able to demonstrate independent financial responsibility to repay debts in order to open a credit card without a cosigner. But if you’re 21 and older, you typically can’t use your parents’ income on a credit card application either. Instead, if you are older than 21, you can include a spouse’s or partner’s income along with your own to qualify for a student credit card.

The primary criteria for a rewards-earning card’s rating is its rewards value. This includes the card’s average rewards rate, estimated annual rewards earnings, sign-up bonus value and reward redemption value.

To estimate a card’s average annual rewards earnings, we first calculate its average rewards rate based on how much it earns in different bonus categories and how closely its categories align with the average person’s spending habits. In other words, we assess whether the card earns rewards at a high rate in the most popular spending categories. 

We use consumer spending data from the Bureau of Labor Statistics (BLS) to get a reliable third-party measure of people’s spending habits. The most recent BLS data estimates average total spending in 2021 was $66,928 per consumer. From here, we determine a “chargeable” spend (which purchases are likely to be put on a credit card and earn rewards). After subtracting expenditures like housing, vehicle purchases, education and healthcare, we get a total “chargeable” annual spend of around $22,500.  

This includes the following spending by category:

• Groceries: $5,200
• Dining out: $3,000
• Entertainment: $2,500
• Gas: $2,100
• Apparel and services: $1,700

Using this data, we are able to assign a weighting to each of a card’s bonus categories. For example, a card’s grocery rewards rate receives a 23 percent weighting based on how much of the average person’s budget is spent on groceries. 

We also estimate the redemption value of points or miles from various issuer rewards programs.

This weighting and rewards valuation allows us to estimate a card’s average annual rewards earnings — how many points or miles you’d earn with a given card if your spending was about average and you used the card for all of your purchases — as well as what those points are worth. We also use point valuations to determine a card’s sign-up bonus value

With these calculations complete, we assign each card a score based on how its average rewards earnings, sign-up bonus value, rewards rate and redemption value stack up against other rewards cards.

The better these values, the higher its score will be, making it more worthy of inclusion in our list and increasing its potential ranking.

We also score cards based on how much it costs to keep them in your wallet or carry a balance. 

To start, each card is scored based on whether it offers an intro APR and how its ongoing APR compares to the rates available on other rewards cards. However, the latter rating only has a slight influence on the card’s score and whether the card is included in our list, since rewards card users generally try to avoid carrying a balance.

More important to both a card’s score and its inclusion in our list is how its annual fee influences its overall value. We consider a card’s annual fee in two ways — how it ranks relative to the fees you’ll find on other cards in the category and how it impacts a card’s overall rewards value. 

Cards with an annual fee will always be at a slight disadvantage in our scoring system since annual fees inherently cut into your rewards value. However, if a card offers terrific value via its ongoing rewards and perks, it can earn a high score and a spot in our list even if it carries a high annual fee. After all, the highest rewards rates and most valuable perks are often found on cards with annual fees. 

With this in mind, we rate a card based primarily on how its ongoing rewards value and ongoing perk value (such as annual credits or bonuses) stack up against those of other cards in the category when you subtract annual fees.

That said, we strive to include as many no-annual-fee options in our list as possible since many people would rather not worry about offsetting fees, even if a card carries impressive rewards and perks.

Rewards cards may make it easy to earn a lot of points, miles or cash back, but how easy is it to use those rewards? After all, if it takes a ton of effort to redeem rewards or you can only redeem rewards in a couple of ways, a card may be more trouble than it’s worth. 

As such, we rate each card’s flexibility based on the restrictions it imposes on earning and redeeming rewards. We factor this rating into a card’s overall score and consider it when deciding on a card’s inclusion in our list. 

Flexibility factors include whether a card only allows you to earn a high rewards rate on only a small amount of spending or requires you to meet a certain earning threshold before you can redeem rewards. We also examine whether your points are worth less when you opt for some redemption options over others and whether a card gives you the flexibility to transfer rewards to travel partners. 

We also score each card’s set of features – its perks and benefits — against five tiers of features to provide a rating. 

We break down these tiers as follows:

• Tier 1 includes fewer features than even standard credit cards (for example, an ultra-streamlined card that offers basic utility and next to nothing in the way of ancillary benefits). 
• Tier 2 includes the benefits you’d expect on standard Visa or Mastercard credit cards, such as free access to your credit score, car rental insurance and $0 liability for fraudulent charges. 
• Tier 3 includes “prime card” or better-than-average card features like cellphone insurance, lost luggage insurance, concierge services and purchase protection. 
• Tier 4 includes luxury features such as airport lounge access, elite status with an airline or hotel and credits for expedited security screening membership programs. 
• Tier 5 includes the sort of exemplary benefits you’ll find on top-tier luxury cards, such as high-value travel credits, cardholder memberships and other unique and valuable perks.

In evaluating the best cards, we tend to favor cards that offer at least Tier 3 benefits, unless they include other unique features that could make up for less-impressive perks.

There’s no limit on the cash back you can earn with the Discover it® Student Cash Back. However, the card’s highest earning rate only applies on the first $1,500 in purchases in an eligible category each quarter, then it drops to 1 percent. If you max out this spending cap each quarter, you can earn at least $300 cash back by the end of the year. 

You can apply and qualify for the Discover it® Student Cash Back with no previous credit history. But a higher credit score increases your chances of approval and a poor credit score may prevent you from qualifying.

Don't worry, you'll still be able to use your student credit card after graduation. Plus, Discover may tag your account as eligible for a credit line increase if you contact Discover to update your personal information and income. 

However, you may want to apply for more rewarding cards with better rates once you graduate and have a positive credit history.

The Discover it® Student Cash Back terms state that you'll start off with at least a $500 credit limit. Although it doesn’t mention a maximum limit and you can't request a specific credit limit when applying, you may be able to contact Discover for a higher limit once you've proven your good credit habits.

You can use Discover it student cards outside the U.S. In fact, the Discover it® Student Cash Back card is a solid choice to take on your study abroad since it doesn't charge foreign transaction fees.

However, there could be a few drawbacks. Purchases that would normally earn cash back in the rotating categories might not earn rewards since Discover's merchant category codes may classify global merchants differently than U.S. retailers. 

Discover credit cards also have a lower merchant acceptance rate compared to Visa or Mastercard — the largest two networks. 

This factor might not be a big issue, though. Discover is accepted at 99 percent of U.S. merchants that accept credit cards, and Discover has 18 global network alliances. That means that over 48 million merchants across more than 200 countries and territories will accept your Discover student card.