Key takeaways
- The Discover it® Secured Credit Card is one of the best secured cards on the market.
- This card comes with a welcome offer and the opportunity to earn rewards on your spending, features that are not standard for most secured cards.
- In addition to reporting your credit activity to the three major bureaus, which helps you establish credit, the card also comes with free access to your FICO credit score along with other credit resources.
- The card also includes features like Freeze it® and Online Privacy Protection to protect cardholders from fraud.
Though secured credit cards are usually light on benefits, the Discover it® Secured Credit Card is a rare option that offers attractive, ongoing cash back rewards and a first-year welcome bonus.
The Discover it® Secured Credit Card is a terrific choice if you have no credit history or a low credit score. This card reports your activity to the three major credit bureaus, helping you establish credit and become eligible for more premium cards in the future. Further, starting at seven months, Discover will review your account to determine if you’re eligible for an upgrade to an unsecured credit card.
Here’s a list of the top Discover it® Secured Credit Card benefits to focus on.
Discover it® Secured Credit Card rewards benefits
The Discover it® Secured Credit Card offers many benefits, including cash back rewards comparable to those of unsecured credit cards. Here is how you can earn rewards with the card.
Ongoing cash back rewards
The cash back rewards are likely the best benefit of this card. You’ll earn 2 percent cash back at gas stations and restaurants on up to $1,000 in combined purchases per quarter, then 1 percent. Further, you’ll earn 1 percent cash back on all spending outside those categories. Rewards can be redeemed at any time, and there’s no minimum you need to earn before redeeming them.
Cashback Match™ welcome offer
As a welcome offer, Discover will match your cash back rewards at the end of your first year — known as Discover’s Cashback Match™ program. For example, if you earn $100 in cash back during your first year of card membership, Discover will award you an additional $100 for a total of $200 in cash back earnings. There’s no limit to how much you can earn, and there are no hoops to jump through to receive your bonus.
Discover it® Secured Credit Card credit-building benefits
In addition to earning rewards, the Discover it Secured card can help you build your credit profile. Here’s how.
Credit reporting
The Discover it Secured card reports to all three major credit bureaus (Equifax, Experian and TransUnion). If you have a limited or no credit history, this can help you build credit — provided you use the card responsibly.
FICO credit score access
The Discover it® Secured Credit Card gives you free access to your FICO credit score via the Discover mobile app. This can help you monitor your credit and track what’s impacting it.
Automatic account reviews
After seven months, Discover will automatically review your account to consider your eligibility for an unsecured card. Typically, the issuer will look at your payment history and see how responsible you were with your card use. If you’re eligible, Discover will refund your security deposit. You may also be eligible for a higher credit limit at that time, depending on your creditworthiness.
Discover it® Secured Credit Card security benefits
The Discover it® Secured Credit Card also comes with several security benefits to help keep your card and identity safe.
Identity alert services
Through Discover Identity Alert services, you’ll receive free daily monitoring of your Experian credit report and be alerted whenever someone pulls your credit. You’ll also receive alerts if Discover finds your personal information on the Dark Web.
Online Privacy Protection feature
With its Online Privacy Protection feature, Discover will remove any personal information about you from 10 of the most popular people-search websites. These websites often store personal information, such as addresses and phone numbers. Similar services typically charge around $100 per year.
Freeze it® feature
Discover’s Freeze it® feature lets you deactivate your card from your online portal or app, blocking new purchases, cash advances or balance transfers. This feature acts as an on-and-off switch for your card, which is helpful if your card is lost or stolen.
Discover it® Secured Credit Card other benefits
In addition to its other features, the Discover it Secured also comes with a few other benefits to note.
No annual fee
Given that this card has no annual fee, you won’t have to worry about offsetting the cost with rewards earned. It’s common for secured credit cards to charge an annual fee between $25 and $50, so this perk will save you that extra expense.
To open an account, you must provide a refundable security deposit, which will become your credit line. The minimum deposit is $200, and the maximum is $2,500.
No penalty APR
In addition to not charging an annual fee, this card also grants you a little forgiveness if you end up missing a payment. The card does not charge a penalty APR nor does it charge a late payment fee on your first late payment — although interest will be charged at the regular rate. Keep in mind, however, subsequent late payments will be subject to a fee of up to $41 each.
Maximizing the Discover it® Secured Credit Card
The Discover it® Secured Credit Card works best as a transition or starter card. In other words, this is a good card for building your credit until you can graduate to an unsecured card with a better rewards structure.
The best way to maximize the benefits of this card is by paying your card on time and in full. By following these steps over the course of seven months, you may improve your credit profile and enhance your chances of being considered for an unsecured Discover card — such as the Discover it® Cash Back.
Keep in mind, however, approval is not guaranteed. You’ll also want to avoid paying the Discover it® Secured Credit Card’s 27.24 percent variable APR by fully paying your card balance on time, lest interest charges eat up any rewards you earn.
To further boost your chances of graduating to an unsecured card, keep an eye on your credit score and personal info with this card’s various perks.
The bottom line
With its ongoing cash back rewards structure, welcome offer and credit-building features, the Discover it® Secured Credit Card is one of the best secured credit cards available to those with limited or no credit history.
Before you apply, be sure to check out our list of the best secured credit cards in case another option interests you.
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