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Several cash back credit cards earn up to 5% back on certain purchases. Two of the most popular 5% cash back credit cards are the Discover it® and Chase Freedom®. This head-to-head Discover it vs Chase Freedom comparison lets you decide which is the better 5% cash back card.
Discover it vs Chase Freedom Review
Both cards earn 5% back on the first $1500 in quarterly bonus purchases and 1% for everything else. That’s potentially $300 cash rewards back in your pocket each year. Neither card has an annual fee.
Visa vs Discover Acceptance Rate
Basically any merchant in the U.S. or world who accepts credit cards will accept a Visa credit card. The Chase Freedom is a Visa Signature product but it does have a 3% foreign transaction fee.
Discover credit cards have a longstanding reputation for offering some of the best purchase rewards. However, not as many merchants accept Discover as they do Visa or Mastercard. The Discover it doesn’t have a foreign transaction fee but not every country has merchants that accept Discover. When traveling abroad, merchants that accept Diners Club also accept Discover credit cards, including the Discover it.
5% Cash Back Calendar
Both cards give you 5% back on the first $1,500 on select purchases each calendar quarter. There are many overlapping categories. Note that both cards usually don’t award the 5% bonus cash for the same category in the same quarter. For instance, the Discover it gave 5% back for grocery stores in the 1st quarter of 2019. The Chase Freedom did the same in the 2nd quarter.
The bonus categories vary a little bit each year. But how the calendars look in 2019 gives you a good idea of what you can earn 5% back on in 2020.
In time, you might decide to get both cards to earn 5% back on your favorite purchases for a longer time.
Below is the Chase Freedom 5% cash back calendar for 2019:
- January-March: Gas stations, tolls, and drugstores
- April-June: Grocery stores and home improvement stores
- July-September: Gas stations and select streaming services
- October-December: Department stores, PayPal, and ChasePay
You earn 5% back (5 Ultimate Rewards points per $1 spent) on the first $1500 in quarterly purchases. All spending above $1500 and all non-bonus category spend earns an unlimited 1% back.
Here are the Discover it bonus categories for 2019:
- January-March: Grocery stores
- April-June: Gas stations, Uber and Lyft
- July-September: Restaurants and PayPal
- October-December: Amazon.com, Target, and Walmart.com
You earn 5% on the first $1500 in combined bonus purchases per quarter. All other purchases earn 1% back.
Both in-store and online purchases at Target earn 5% back in the 4th quarter of 2019. Only online Walmart purchases earn 5% back. Amazon is a yearly bonus partner during the 4th quarter.
Verdict: Varies. The better option depends on where you shop.
What other credit cards you use may also influence which is the better card. The reason why is that your Chase Freedom points might be worth more if you have another Chase credit card that earns Ultimate Rewards. It is also one of the best Chase credit cards.
Each Chase Freedom purchase earns 1 or 5 Chase Ultimate Rewards points per $1 spent. Every point is worth 1 cent when redeemed for cash statement credits or bank account deposits, booking travel through Chase, or gift cards. Your points are worth 0.8 cents each for Amazon.com shopping credit or other retail partners including Apple.
There is no minimum redemption amount for cash rewards. But you will need to have a minimum balance (between $5 and $20 for most brands) for gift cards.
Travel Redemption Bonus
Here’s where the Chase Freedom gets more interesting. Your points are worth 1.25 cents each if you transfer them to your Chase Sapphire Preferred or Chase Ink Business Preferred credit card account. And if you own the Chase Sapphire Reserve, these points are worth 1.5 cents each when booking award travel.
All three cards also let you transfer your points to the Ultimate Rewards 1:1 airline and hotel partners including United Airlines, Southwest, Emirates, British Airways, and World of Hyatt.
The Discover it redemption options don’t offer a backdoor travel redemption bonus like the Chase Freedom.
Your points are worth one cent each and redeemable for cash statement credits, bank deposits, charity donations, gift cards, and Amazon shopping points.
The Discover gift card options require a minimum of $20 balance. Other cash rewards start at one penny so redeeming for cash is the easier option.
Both cards offer a signup bonus where you can earn a one-time cash bonus.
The standard Chase Freedom bonus offers $150 cash (15,000 points) after spending $500 in the first 3 months.
Discover matches every penny of every reward you earn in the first 12 months. Whether you earn $1 or $500 in rewards that the first year, Discover doubles it. You have the possibility of earning more with this bonus. But you will need to spend at least $3000 in the 5% bonus categories to break even. This bonus deposits into your account as one lump-sum payment at the end of the first 12 months.
Verdict: Chase Freedom. Unless you’re a big spender, the Chase Freedom bonus is easier to earn and deposits into your account sooner.
Other Card Benefits
Cash back credit cards are not known for having many exciting additional benefits (though some of the best cash back credit cards 2019 do have their own perks). Here is what both cards offer.
- Purchase protection for 120 days (up to $500 per claim)
- Extended warranty protection of up to 1 additional year
- Secondary rental car insurance
- Contactless payments
The Chase Freedom has a 3% foreign transaction fee.
- FICO credit score monitoring
- Social Security number alerts
- No late fee on first late payment
- Overnight card replacement to U.S. street addresses
- No foreign transaction fee
Although the Discover it doesn’t have an annual fee, it has less-universal acceptance across the globe than the Chase Freedom Visa Signature. For international travel, consider getting one of the best credit cards for travel rewards instead.
Verdict: Discover it. These add-on benefits are more likely to be used on a regular basis.
Credit Score Needed
You will have the best approval odds for the Discover it or Chase Freedom with a minimum 700 credit score. Having a 750 credit score or higher gives you the best approval odds.
Also, the Chase 5/24 application guidelines apply to the Chase Freedom. If you have opened or been added as an authorized user to at least 5 credit cards in the last 24 months, Chase will most likely decline your application. This is even if you have a perfect credit score.
If you are close to the 5/24 mark, see if you prequalify for a credit card before you apply. It’s free to check and doesn’t impact your credit score.
When the Chase Freedom Wins
- Own other cards that earn Chase Ultimate Rewards
- Like redeeming your points for cash or travel rewards
- Prefer Visa credit cards for near-universal acceptance
When the Discover it Wins
- Points are worth the same for cash or Amazon.com rewards
- Can use the free credit monitoring tools
- Want a card with no foreign transaction fee
Summary of Discover it vs Chase Freedom
Both the Chase Freedom and Discover it offer 5% back on many of the same categories. The better card depends on if you already earn Chase Ultimate Rewards with another card. Also, you must decide if where you normally shop accepts both Visa credit cards (Chase Freedom) and Discover.
Learn more: Chase Freedom
Learn more: Discover it
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Editorial Note: The editorial content on this page is not provided by any bank, credit card issuer, airlines or hotel chain, and has not been reviewed, approved or otherwise endorsed by any of these entities.