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So you’ve decided to take the next step and graduate from debit to credit. Congratulations! I salute you. As long as you pay your bills on time and in full, I promise you the grass is greener over here. Without further adieu, it gives me the utmost pleasure to introduce the best first unsecured credit card around: the Discover it Cash Back card!
Discover it Card Review
Let me convince you why the Discover it is one of the best first unsecured credit cards to add to your portfolio.
Easier approval
This card is among the easier credit cards to be approved for. Online data points suggest a credit score around 700 and a minimum wage income are sufficient for approval. If you’d like some reassurance, you can check out Discover’s pre-approval tool to give you a better idea of your approval odds.
I was personally approved for this card as my first credit card at 23 years old with a score in the mid-700s, a minimum wage income, and no previous loans. However, I had been an authorized user on my parents’ credit card accounts, which can also help you if your folks have good credit habits.
Cash back rewards
As opposed to many other starter cards on the market, this one gives you cash back on your purchases. That means that for every dollar you spend on the Discover it card, you get a small portion (either 5% or 1%) of your money back. Welcome to effectively never paying full price for anything ever again! By using a different credit card with no rewards system, debit card, or cash, you are leaving money on the table.
Rotating categories
The Discover it Cash Back card’s rewards system comes in the form of 5% quarterly rotating categories. Every three months, the card will give you 5% of your money back (up to $75 per quarter) on purchases made within specific merchant categories and 1% back on everything else. For example, this was the 2022 rewards calendar:
Q1 (January – March)
Grocery stores and fitness club and gym memberships
Q2 (April – June)
Gas stations and Target
Q3 (July – September)
Restaurants and PayPal
Q4 (October – December)
Amazon.com and digital wallets
Over the past five years I’ve had this card, grocery stores, gas stations, restaurants, PayPal, and Amazon.com have consistently appeared every year, although the quarters they’ve appeared in weren’t always the same.
The only thing you need to do for your 5% back is click a button to activate your card at the start of each quarter. Otherwise you’ll only earn 1% back, even if the spend is within the designated 5% merchant category. While a little annoying, Discover always sends email reminders that make it easy to remember to activate your card. Personally, I’m happy to click a button four times a year to get free money.
No annual fee
So this card gives you 5% of your money back on up to $1500 spent in specific categories every quarter, and unlimited 1% back on everything else…what’s the catch?
No catch! The Discover it card has no annual fee.
That means if you max out each quarter by spending money you were going to spend anyway, then the card basically pays you $300 a year before adding in the 1% from all other purchases. That’s $300 you can invest or put towards a vacation.
And because there’s no annual fee, you can keep the card for the rest of your life without having to worry. As time passes, your credit score’s average age of accounts will increase, and you’ll see that your first few cards are the most valuable in this respect.
An uncapped, year-long intro bonus
One major superpower of the Discover it card (albeit temporary) is its intro bonus.
Many credit card issuers offer an introductory lump sum gift in the card’s reward currency (ie. points, miles, or cash back), provided that the new card member meets certain requirements. Usually, you have to spent a certain amount of money on the card within the first 3-6 months of issuance.
For example, the Chase Freedom Unlimited card has typically offered a welcome bonus of $200 after spending $500 on purchases in the first 3 months from account opening.
Because they provide such high value, you really shouldn’t apply for a new credit card if you wouldn’t hit that intro bonus through normal spending.
However, the Discover it Cash Back card’s intro bonus is structured a bit differently and can be even more lucrative.
Discover will match all the cash back you earn in your first year, with no limit. For every penny of cash back you earn, Discover will give you another penny. That means that for the first year, you get 10% cash back on the quarterly rotating categories and 2% back on everything else! This alone makes the Discover it the best first unsecured credit card.
Great to build credit history before moving to other issuers
If you think you’ll prefer to redeem your credit card rewards towards travel instead of simple cash back, then you have many fun avenues you can take in the future. Transferable points currencies like Chase Ultimate Rewards points, Citi ThankYou points, and American Express Membership Rewards points can easily be twice as valuable as cash back, when redeemed strategically.
To keep this post simple, you’ll likely want to get some Chase cards if you’re interested in travel and due to certain Chase rules, those cards are better to get at the beginning of your credit card journey. However, Chase likes to see at least one year of credit history in your own name before approving you for any of their products.
Related: Why use a credit card instead of a debit card? 9 pros of credit cards
I was rejected the first time I applied for a Chase card for having only 9 months of credit history (but was luckily able to convince the customer service rep to approve me after calling reconsideration).
I tell you all this to say that because the Discover it card has a year-long welcome bonus, and because Chase wants at least a year of credit history, you can maximize the Discover it card bonus while biding your time for Chase without feeling like you’re missing out.
Top notch customer service
I haven’t had to interact with customer service much personally, but when I have, Discover was very pleasant to work with both over the phone and via online live chat. Most anecdotal data points I’ve seen online have praised Discover’s customer service as being some of the best among credit card issuers.
Customizable card design
Most credit cards on the market come with a pre-determined design. However, Discover has over a hundred options that range from animals, cityscapes, initials, sports teams, famous art pieces, and bright colors that you can choose from.
While the design doesn’t change the rewards the card earns, being able to customize your card adds an element of fun and personalization. If you get bored with your current look, Discover lets you pick a new design any time you want for no charge.
There’s a student version
If you’re over 18 and a college student, the Discover it Student Cash Back card is available to you. All the rewards and benefits are the same as the normal Cash Back card. The main difference is that the income and credit score requirements are lower. Once you graduate, your card will also graduate to the normal Discover it Cash Back card.
Overall Discover it Card Review
The Discover it Cash Back card was the best first unsecured credit card for me, and I recommend you explore it and see if it will be a good fit for you too!
Get this card if:
- You’re interested in cash back.
- You don’t like annual fees.
- You want to get Chase cards eventually but don’t currently have other unsecured credit cards in your name.
Don’t get this card if:
- You’re going to be outside the U.S. for a significant period of time in the first year. Discover is not widely accepted abroad, so you wouldn’t be able to rely on it as your primary payment method.