Last Updated: 5/13/2011
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While there are some amazing airline and hotel loyalty credit cards out there, there’s something special about pure cash back credit cards that’s spiritually appealing to our inner capitalist selves. Out with black-out dates and annoying reservation systems; in with statement credits and instant gratification.
Last Updated: 12/26/2011
The Discover More card is a good example of just how complex humans can make things, and a good example of why the PlasticIQ Ranking Engine can be a valuable decision-assisting tool. To the casual consumer, one that just reads bolded marketing copy and doesn’t examine the fine print, the Discover More card might look like a 5% cashback credit card. But the fact is that Discover More has both spending caps and seasonally rotating categories, along with insanely complex rewards tiering (see below) which limit the value of the 5% cashback feature.
Note: we cover 3 distinct Discover More offers in this review. One of the offers comes with a nice $150 cash bonus, whereas an otherwise identical offer doesn’t (but this 2nd offer has lower promotional APRs). We also include a nice 18-month 0% APR balance transfer offer.
If rotating seasonal categories aren’t your thing, but you’re otherwise on the hunt for a Discover card, check out the Discover Escape Card, our top-rated cash back card out of all Discover cards. If you aren’t wedded to Discover, then you may want to have a peek at the American Express Blue Cash Preferred Card–it’s a mountain of plastic.
| Discover More with $150 Cash Back | Discover More–15 Month 0% Purchase APR | Discover More–18 Month Promotional Balance Transfer | |
|---|---|---|---|
| EARNINGS REWARDS | |||
| Base Rewards |
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| Rotating Bonus Categories | Earn 5% cashback bonus on pre-defined categories that rotate each quarter (see below for details) | ||
| Spend Range Bonus | $150 in cash when you spend $1,000 within the 1st 3 months of card approval. | None | None |
| Other Bonuses | Earn 2% cashback bonus on purchases made at Amazon.com with a cap of $250 per billing period; any purchases over this amount earn rewards at the standard 1% cashback rate. | None | None |
| FEES | |||
| Annual Fee | None | ||
| Balance Transfer Fees | Introductory balance transfers at 3%; after that, either $10 or 5%, whichever is greater. | ||
| Foreign Transaction Fee | 0% | ||
The Discover More card pays a total of 5% cash back on certain pre-defined spend categories, which rotate quarterly. Here’s both the 2011 and 2012 categories (we provide the 2011 ones to give you an idea of how the categories might change each year.). As you can see, from 2011 to 2012, Discover has significantly increased the amount of quarterly spend eligible for bonus treatment–an important improvement.
| Quarter/Time Period | 2012 Bonus Categories | 2012 Spend Limits on Bonus Categories | 2012 Bonus Categories | 2011 Spend Limits on Bonus Categories |
|---|---|---|---|---|
| Q1 (Jan-Mar) | Gas, Movies, Museums | $1,500 | Travel (hotel, air, auto rental, cruises) and Restaurants | $800 |
| March | N/A | N/A | Grocery and drug stores | $200 |
| Q2 (Apr-Jun) | Movies and restaurants | $1,500 | Home improvement, Fashion (department and clothing stores) | $400 |
| Q3 (Jul-Sep) | Gas, movies, theme parks | Not yet announced | Gas, Hotels, Movies, Theme Parks. | $300 |
| Q4 (Oct-Dec) | Department stores, electronics stores and toy stores | Not yet announced | Restaurants and Fashion (department and clothing stores) | $300 |
So, if we assume that Q3 and Q4 2012 will also have spend limits of $1,500 (after which you would only earn the standard cashback rate of either 1% or 0.25%), then the maximum you could earn from these bonus categories would be $6,000 of spend per year at a 5% rewards rate, which works out to $300. Not bad, if you can max out those categories each quarter.
The Discover More Card, is, without a doubt, the most complex rewards program we have programmed into the PIQ Ranking Engine to date. The combination of rewards based on annual spend, along with certain spend categories (those rotating bad boys!) not counting as part of the annual spend, is a doozie. We’ll break it down here (after I down a martini):
This is fairly straight-forward. If you’re in the market for rewards, and don’t need to execute a balance transfer or obtain a low purchase APR, then the $150 sign-up bonus offer is the clear winner (it even comes with an additional 2% bonus on Amazon purchases, unique among the 3 offers).
If, on the other hand, you need to make a balance transfer, then of course go for the 18-month 0% APR balance transfer offer (but you didn’t need me to explain that, now did ya).
Finally, if you’re in the market for a low purchase APR, then the 15-month 0% promotional purchase APR More card is the one for you.
While we don’t yet know the rewards caps for Q3 and Q4 of 2012, if we assume they are the same as Q1 and Q2, you might be able to earn an additional $300 in cash back if you use the card perfectly and max out the rewards categories. Let’s also be clear that you should not be using the Discover More as your primary everyday credit card.
Ultimately, Discover More’s spending caps and overall complexity of the rewards program are its Achilles Heel. You’ll have to decide whether the extra monitoring effort justifies the incremental annual cashback you could earn with it.
| Discover More $150 CashBack Offer | Discover More 15-month 0% APR Purchase Offer | Discover More 18-month 0% APR Balance Transfer Offer |
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Last Reviewed: 8/13/2010
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The Bank of America Accelerated Rewards American Express credit card offers a respectable, but by no means jaw-dropping, 1.25 World Points per dollar spent. Since World Points can be redeemed in the form of cash back at a 1:1 rate (as long as you are careful! read on…), the card operates as the equivalent of a 1.25% cash back card.
Last Reviewed: 8/5/2010
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The Capital One No Hassle Cash Rewards credit card is a fairly straightforward cashback credit card. It’s not an all-star card, but neither is it a laggard–somewhat North of middle-of-the-pack. One callout is that Capital One tends to tailor their offers based on your credit worthiness.
Last Reviewed: 8/1/2010
While the Bank of America Accelerated Cash Rewards card currently ranks 5th out of 32 cashback cards, as the table below shows, this card will earn you significantly less than the top-ranked Discover Escape and American Express Blue Cash Preferred Card.
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Last Updated: 5/30/2011
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The Penfed Visa Platinum Gas card might be called a hidden gem. The value proposition of this card is very straightforward: its awesome for gas rewards (5% cashback)–but plain Jane on all other purchases (1% cashback).
Note: As of 4/30/2011, American Express replaced the Amex Blue Cash Card (which is no longer available), with 2 new credit cards: the Amex Blue Cash Everyday Card, and the Amex BlueCash Preferred Card. While the Everyday Card is slightly inferior to the old Blue Cash card at higher levels of spend (say, >$1,000 per month of spend on the card), it does outperform at lower levels of spend.
However, the real gem is the new American Express Blue Cash Preferred Card–which simply dominates it’s predecessor and consistently appears at or right near the top.
Follow this link to read PlasticIQ’s review of the American Express Blue Cash Preferred Card.
Last Reviewed: 7/23/2010 Read the rest of this entry »
The Amex Blue Cash Card (NO LONGER AVAILABLE) is a force to be reckoned with, ranking near the top of the pack if you spend enough on the card. If used skillfully, Blue Cash can earn an effective cashback rate of 3% or even more.
Last Reviewed: 7/17/2010
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The Discover Escape credit card (aka Escape by Discover) masquerades as a travel credit card, but is really falls into what I believe is a unique class of cards which I would dub “restricted cash-back credit cards”. Restrictions aside, this piece of plastic is a heavy hitter, and is frequently at the top of the PlasticIQ Ranking Engine. You can apply directly for Discover Escape, or continue reading this review for more insights into why even Clint Eastwood would have wanted this card in his back pocket when he popped out of the Bay soaking wet.
The Chase Freedom card comes in several different flavors of rewards programs. According to one of the more competent CSRs that I spoke to at Chase, the Ultimate Rewards program is the direction that Chase is moving in. Read the rest of this entry »
