If youâ€™re going to use a credit card, choosing one that rewards you for spending is a given. Choosing the right card? Thatâ€™s another story. With so many cards offering similar cash back programs and terms it can be difficult to choose one over another.
For example, should you get the Chase FreedomÂ®<!–Chase Freedom®–> or Discover itÂ® Cash Back<!–Discover it® Cash Back–>?
Both offer 5% cash back categories that change each quarter, with that 5% limited to your first $1,500 in spending on those categories each quarter. Where they differ is in the actual 5% bonus categories, the introductory bonus offer, and some fine print.
In this post, weâ€™re going to dissect both cards and how they stack up against each other.
The information related to Chase FreedomÂ® has been independently collected by MagnifyMoney and has not been reviewed or provided by the issuer of this card prior to publication.
With Chase FreedomÂ®<!–Chase Freedom®–>, you can Earn 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate. Enjoy new 5% categories every 3 months. Unlimited 1% cash back on all other purchases.<!–Chase Freedom®–> Earn a $150 Bonus after spending $500 on purchases in your first 3 months from account opening.<!–Chase Freedom®–>
You earn 5% cash back at different places each quarter like grocery stores, gas stations, Uber and Lyft, restaurants, and Amazon.com up to the quarterly maximum each time you activate. The 5% is limited to $1,500 spending per quarter, 1% after that.
All other purchases get unlimited 1% cash back, automatically. You can redeem cash back for gifts cards, statement credits, charitable donations, deposits to an account or merchandise.
Aside from the cash back program, Discover itÂ® has special introductory offers. Thereâ€™s an intro APR of 0% for 14 months<!–Discover it® Cash Back–> on purchases and balance transfers. There is a 3% intro balance transfer fee, up to 5% fee on future balance transfers (see terms)*<!–Discover it® Cash Back–>.
Now, letâ€™s dive into the pros and cons of both cash back programs.
Pro: A competitive intro bonus for small spenders. Earn a $150 Bonus after spending $500 on purchases in your first 3 months from account opening.<!–Chase Freedom®–>
This sign-on bonus is great perk for new customers.
Pro: Flexible points. While you can always use your points for cash back, the Freedom earns Chase Ultimate RewardsÂ® points. That means you can also use them for travel, gift cards, and other items. In addition, if you have another card that earns Chase Ultimate RewardsÂ® points you can combine the points for more reward opportunities.
Con: You need to activate your 5% bonus. Another negative of the Chase FreedomÂ®<!–Chase Freedom®–> card is the 5% bonus category requires activation each quarter. If you forget to subscribe to the program, youâ€™ll only get 1% cash back for all spending, so this is a card that youâ€™ll have to actively manage. Plus, the 5% bonus categories are announced quarterly, so it can be difficult to plan ahead.
Pro: A good introductory offer for big spenders. You can get a dollar-for-dollar match of all the cash back youâ€™ve earned at the end of your first year, automatically (new cardmembers only). That can really add up if you tend to be a big spender, though the catch is that bonus double cash back doesnâ€™t hit your account until the very end of your first year. The Chase FreedomÂ®<!–Chase Freedom®–>â€˜s introductory offer hits your account after just 3 months worth of spending.
Con: You need to activate your 5% bonus. Like the Chase FreedomÂ®<!–Chase Freedom®–> card, Discover itÂ® makes you subscribe to the 5% bonus place each quarter. You can set up email reminders, but itâ€™s still a hassle to actively opt-in instead of being about to set that on auto pilot. So, again, this isnâ€™t a card where you can passively earn cash back.
Now, itâ€™s possible to have the best of both worlds if it makes sense.
You can get both cards and alternate use throughout quarters so you can take advantage of both cardâ€™s 5% bonus categories to get 5% on more of your spending.
Of course, youâ€™ll have to remember to activate each bonus category and label the cards in your wallet to know which one to use at what time.
But, if you spend in these areas anyway why not earn cash back for doing so?
Thereâ€™s no annual fee for either card.
The VisaÂ® Platinum Rewards Credit Card from Nusenda Credit Union<!–Visa® Platinum Rewards Credit Card from Nusenda Credit Union–> let you Earn 3 bonus points, or 5% cash back, respectively, for every dollar they spend on purchases for movies, restaurants, and home improvements (up to $1,500 per quarter).<!–Visa® Platinum Rewards Credit Card from Nusenda Credit Union–> Rates are 11.00% – 15.00% Variable<!–Visa® Platinum Rewards Credit Card from Nusenda Credit Union–> APR with no balance transfer fee. Thereâ€™s an intro 5% APR Intro Rate for all Balance Transfers (first six cycles after card opening)<!–Visa® Platinum Rewards Credit Card from Nusenda Credit Union–>.
Even better, you donâ€™t have to activate the categories each quarter. Here are the 5% cash back categories in detail:
The U.S. Bank Cash+â„¢ Visa SignatureÂ® Card has a rewards program thatâ€™s a little different than all three offers above. With this card you can earn 5% cash back on your first $2,000 in combined eligible net purchases ($100 per quarter) on two categories you choose. That adds up to $400 cash back!
Overall, the Chase FreedomÂ®<!–Chase Freedom®–> and Discover itÂ® Cash Back<!–Discover it® Cash Back–>are similar cards. Both earn 5% cash back in revolving categories (up to $1,500 in combined purchases each quarter you activate). If youâ€™re making a choice of one over the other, your choice would ultimately depend on your spending habits, so you can use the card (or a combination of both cards) to maximize your regular purchases.