Find Out Secure Credit Card Review
Discover it Secure Credit Card Full Review
Great rewards for a secure credit card
Generous bonus for new cardholders
Automatically converts to an unsecured card
Higher APR than some other secure cards
Comparatively low maximum credit limit
- Earn Cash Back: Few of the other secure cards offer any rewards or benefits, so the Discover it Secured card is essentially different from the pack. You’ll earn 2% cash back at gas stations and restaurants, on up to $ 1,000 spent each quarter in combined spending. You will also get unlimited 1% cash back on all other purchases.
- Cash back bonusAnother great feature of this secure card is that new cardholders are eligible for the Discover Cash Back Match. After your first year as a cardholder, Discover will match any cash back rewards you’ve earned throughout the year, doubling your rewards. Since the cash back rates are relatively generous, this is a big plus, especially for a secure card.
- Automatically revised to convert to an unsecured card: Discover it Secured makes it easier to transition to an unsecured card than with some secured credit cards. With some secure cards, you have to specifically request an unsecured card review, and therefore do not have an automatic review process to ease the transition of your secure card. With this card, after eight months as a cardholder, Discover automatically examines your account to see if you qualify for an unsecured card. If this happens, the company will refund your security deposit if you take the necessary steps to apply for an unsecured card and you will enjoy all of its benefits in the future, with no separate application or account closure required.
- Higher APR than some other secure cards: You can’t expect a low APR with a secured credit card, since you applied for the card because your credit report is either thin or damaged. Still, the 22.99% APR on Discover it Secured card purchases is higher than the rate of some competing cards, including even those that don’t have an annual fee. In addition, some other cards allow you to deposit more than Discover it Secured, and thus allow you to benefit from a higher account limit.
- Comparatively low maximum credit limit: As a secured card, the Discover it Secured card requires you to deposit a security deposit that serves as a credit limit, and is refunded when you deposit or upgrade the card. For example, if you deposit $ 200, your credit limit is $ 200. The maximum credit limit you can have with this card is $ 2,500. Assuming you want more purchasing power and are able to provide the necessary deposit, other secure cards allow limits of $ 3,000 or even $ 5,000.
This card is a great option if you need to build or rebuild your credit and spend frequently on gas and dining as spending on both will earn you a decent 2% cash back. Even if you’re not a big driver or a big diner, the 1% cash back on all other purchases can really add up, especially the first year with the card when those rewards are matched at the end. of the first 12 months of opening an account. .
This card is also great if you currently have a balance on another card with a high interest rate. If you transfer a balance during the eligibility window (approximately 3 months after getting the card), you will receive an introductory APR of 10.99% for 6 months on the balance transfer, which is almost certainly less than what you are currently paying for.
There is also an interesting, albeit small and unique, perk if you miss a payment on the card. The $ 40 fee is waived on your first late payment, but not the interest charge you incur on the balance by not repaying it in full by the due date.
Discover the unique offer by secure credit card
The Discover it Secured card has a lucrative bonus, especially for a secured credit card. At the end of your first year as a cardholder, Discover automatically matches any Cash Back Rewards you’ve earned in the first year of opening an account. If you’ve earned $ 200 in cash back for the year, that means you’ll actually receive $ 400 in total rewards.
With this card, you will earn 2% cash back at gas stations and restaurants, on a maximum of $ 1,000 spent per quarter. Establishments where you can earn dining rewards include full-service restaurants, cafes, cafeterias, and fast food outlets. At the rate of 2%, that means you could earn up to $ 20 per quarter in rewards, or $ 80 per year.
You’ll also get 1% cash back on all other purchases, with no limit on how much you can earn.
Reward redemption details
Your cash back can be redeemed for statement credits, cash deposits to your bank account, gift cards, charitable donations, or at checkout on Amazon.com.
The rewards are worth the same face value regardless of your redemption method. You can redeem your rewards at any time, for any amount, and they never expire.
How to Maximize Your Rewards
To get the most out of your card, maximize the purchases you make with it that earn its highest rate of 2%. This means using the card every time you buy gasoline and every time you take out food, even if it’s just a fast food meal, which qualifies for restaurant fare.
If you live in a typical household, you should quite easily hit the $ 1,000 quarterly limit on qualifying purchases at this high rate. Since the average household spends $ 2,094 per year (or about $ 524 per quarter) on gasoline, according to the Bureau of Labor Statistics, fuel purchases could easily get you halfway over the limit.With $ 3,526 per year (or roughly $ 882 per quarter) the average spending per household on food outside the home, according to the same study, you could likely spend the remainder of the quarterly limit of $ 1,000, and more. , to eat at a restaurant. Over the course of a year, using your Discover it Secured card to pay for all that gas, you could earn around $ 42 in cash, with restaurant meals earning around an additional $ 71 per year in rewards.
You should also use the card for all other possible transactions, no matter how small. While you only get 1% cash back on these other purchases, there is no limit to how much you can earn. For example, you will earn $ 25 in rewards if you spend $ 2,500 per year at the 1% cash back rate, and this amount is relatively easy to achieve if you use the card rather than cash or check. for most purchases.
Finally, there is the card cashback game for the first year. With the scenario above, you would earn roughly $ 25 in cash back over the course of the year and then that total would equal the end of the year, for a total of $ 50 in rewards.
It might even be worth considering the cash back bonus if you are planning on spending a lot and are flexible about when you do. A large purchase made in the 11th month you have the card, while you are still eligible for the cash back winnings match, which could earn twice the cash back bonus earned on that purchase compared to waiting a few weeks before starting your second. year with the card.
- Free FICO Credit Score
- Learn about identity alerts and account monitoring
- Freeze on / off switch to avoid unauthorized charges
When it comes to customer satisfaction, Discover is ranked number two nationally. According to JD Power Credit Card 2020 Customer Satisfaction Study it has a score of 837, compared to the survey average of 810.
Discover claims that its customer service is based in the United States. He is available by phone, on his website, or via the mobile application. Help is available 24 hours a day at 1-800-DISCOVER or you can contact customer service online.
Discover, like many other card issuers, allows you to freeze and unlock your account as needed and monitor your credit report online or through the mobile app. The company will notify you if there is any suspicious activity, and you are never responsible for any unauthorized charges, which are also standard features.
Hidden fees to watch out for
Balance transfers are subject to an initiation fee of 3% of the amount of each transfer for transfers posted to your account during the initiation period. After the introductory period, a 5% charge will apply.
The Discover it Secured card is one of the most profitable cards on the market for those who cannot get a regular credit card and are looking to create or repair credit. It’s essentially unique to offer rewards that would be respectable or better in a card that wasn’t secure: 2% cash back on gas and restaurant purchases, but with a cap of $ 1,000 per quarter, as well as 1% cash back on all other purchases. , without cap. And the card doesn’t have an annual fee either.
It also makes it easier to transition to an unsecured i.e. typical credit card. After eight months, the secure account is reviewed and the cardholder is automatically considered for an unsecured card. If the payments were made on time, the account can be automatically upgraded to a card such as the Discover it Chrome card.
There is also an option to transfer the balances of the high interest credit cards to this one. While this does not trigger a 0% APR period, as with some unsecured cards, it does allow the cardholder to hold the balance for six months at 10.99% APR, which could be as little as half. of what he pays with. another card, especially if they have a less than stellar credit history.
You could also do worse than carrying this card with you on a trip abroad, or using it to buy online from overseas vendors who will have to convert dollars into their own currency. The card has no foreign transaction fees, a non-universal benefit even for unsecured cards, and the rewards accrue on your purchases abroad.
Other secure cards offer a bit lower APR than this card, so it might not be the best choice if you plan to carry a balance on the card, or even are worried about having to.