Discover it® Cash Back was the first 5% cash back cards and remains a wallet staple for anyone who likes getting 5% rewards in rotating categories. Through the end of September, the Discover it® has perhaps the most flexible bonus 5% cash back category of any credit card. For the next three months, the Discover it® Cash Back card is the best cash back card you can use for general purchases.
This quarter’s 5% cash back category includes mobile wallet. I previously mentioned this in my quarterly post about Discover’s cash back categories. Better yet Discover doubles your cash back earnings in the first year. This perk makes this effectively 10% cash back in bonus categories in your first year.
With mobile wallet purchases coming up as a category and with the card’s welcome bonus, now is a great time to add this card to your wallet. Here are the details on earning 5%-10% cash back almost everywhere from July 1, 2023 – September 30, 2023.
And if you’re a new cardmember, you can pretty easily earn north of $500 in bonuses between the card’s referral welcome bonus and the cash back categories in the first year of having the card.
Discover it® Cash Back welcome offer: $100 statement credit + double cash back in your first year. (Annual fee: $0)
Get a $100 statement credit when you’re approved and use the card within the first three months. Plus, get all of your cash back doubled in your first year of having the card. Get this welcome bonus.
The $100 statement credit after approval is an easy welcome bonus, even if it is smaller than other easy welcome bonuses. More interesting is the doubled cash back in the first year of having the card which turns the cards 5% rotating categories into 10% rotating categories.
5% cash back in rotating categories. (More in our card review.)
This is a referral link. All information about Discover it® Cash Back has been collected independently by cardsandpoints.com.
My plan for my Discover Card
I carry the Discover it® Cash Back card and have already completely maxed my rewards for this quarter. Since I have the Amex Blue Cash Preferred for groceries, (and the Citi Dividend offered 5% on groceries from last quarter) I didn’t use Discover card for grocery purchases. Instead, I used my Discover card as my “everything else” credit card. With the exception of Costco and the rare place that didn’t accept Apple Pay, I was earning 5% everywhere.
How Discover it® Cash Back 5% categories work
Each quarter, Discover announces its Discover it® Cash Back bonus categories. Discover it® cardmembers earn 5% cash back on up to $1,500 in purchases made in bonus categories during the quarter. Discover’s bonus categories are typically very useful and include many places most people shop anyway. Historical bonus categories have included grocery stores, drugstores, restaurants, Target, Walmart, PayPal purchases, Amazon.com purchases, and purchases at wholesale clubs.
All you need to do to earn 5% cash back is activate the card’s quarterly categories and use your card to make purchases at merchants within those categories during the quarter. Activation is easy and can be done on the Discover website within a matter of minutes.
From July 1, 2023 until September 30, 2023 Discover it® Cash Back categories include gas stations and digital wallets. More on how to activate and current cash back categories can be found over in our Discover 5% cash back current categories article.
What makes this quarter special
What makes this quarter’s cash back bonus so special is that it applies to mobile wallet purchases. These days, most places accept mobile wallet purchases. That makes mobile wallet purchases a kind of “everywhere” category. If you have a recent Android phone or iPhone, your phone is probably mobile wallet capable.
If you’ve never used a mobile wallet before, here are some helpful articles from Apple on how to set up and how to use Apple Pay. Google has a step-by-step guide on setting up credit cards in Google Pay.
All you have to do is add your card to your mobile wallet and use your phone to pay for your purchases. That means that you can get 5% cash back anywhere Discover and mobile wallet purchases are accepted.
What you can get in your first year
One unique feature of Discover cards is that all of them double the cash back you get in your first year of holding the card. If you combine 5% category spending with the welcome bonus, you can conservatively earn $500 cash back in your first year with minimal spending on this no annual fee card. Here’s how this breaks down.
- $100 welcome bonus from the refer a friend offer on this page.
- $150 cash back from quarterly 5% categories. This assumes that you spend the full $1,500 in two of the card’s quarterly cash back categories. This number could be as high as $300 if you maximize the cash back categories every quarter.
- No other spending on the card. Since the Discover It effectively earns 2% cash back on the card in its first year, you’re probably better off using a 2% cash back card.
This comes to a total of $250 cash back in your first year. But since Discover doubles your first-year cash back, you could get a total of $500 cash back in your first year. This total could be even higher for you. We’re only assuming that you use two of the card’s categories.
Discover it® Cash Back welcome offer: $100 statement credit + double cash back in your first year. (Annual fee: $0)
Get a $100 statement credit when you’re approved and use the card within the first three months. Plus, get all of your cash back doubled in your first year of having the card. Get this welcome bonus.
The $100 statement credit after approval is an easy welcome bonus, even if it is smaller than other easy welcome bonuses. More interesting is the doubled cash back in the first year of having the card which turns the cards 5% rotating categories into 10% rotating categories.
5% cash back in rotating categories. (More in our card review.)
This is a referral link. All information about Discover it® Cash Back has been collected independently by cardsandpoints.com.
A few notes on applying for Discover credit cards
- You can have as most two credit cards issued by Discover at the same time. You can have only one student card.
- Your first account must be opened for a year before Discover will issue you a second credit card.
- You can get welcome bonuses for Discover cards if you have had the same card in the past.
- Discover reports business credit cards to the personal credit bureaus. Keep this in mind if you are trying to stay under 5/24 for Chase applications.
- You can check the application status of your Discover card application online, at Discover’s website.
Frequently asked questions
Can I buy gift cards with Discover cards?
Buying gift cards with your Discover card can be a way to expand the card’s 5% categories to other merchants. For example, if this month’s categories include grocery stores and your local grocery store sells Starbucks gift cards, you can buy a Starbucks gift card at your grocery store and effectively earn 5% on your Starbucks purchases. Gift card purchases like this can be part of a 5x everywhere strategy.
Is Discover a good card for someone who doesn’t fly a lot?
Discover it® Cash Back can be a great addition to your wallet whether or not you are a frequent traveler. The card’s 5% bonus categories generally feature everyday categories like gas, groceries, and drugstores.
Can I redeem Discover it® Cash Back rewards automatically?
Yes. Discover cash back rewards can be automatically redeemed for a statement credit each month. Log into your account at Discover.com to sign up for automatic reward redemptions.
Does Discover it® Cash Back offer an extended warranty protection?
No. Discover eliminated extended warranty protections and many other benefits in early 2018. If you’re purchasing an item with a warranty, it can be a good idea to use a card with a great extended warranty benefit instead.
