Discover It Miles Review: Best Way to Travel More?

Discover it Miles rewards users with 1.5x miles and no annual fee (a rarity among travel credit cards). Plus, as a promotion, the card will match the miles you earn at the end of your first year.

Think Discover it Miles might be the travel rewards credit card for you? Read on to find out.

In this article, we'll explain the pros and cons of the Discover It Miles including the 7 reasons to consider the card and 3 reasons to look elsewhere.

Who This Card Is Best For

• You like to travel: With this card, you earn miles every time you shop and you can save them to use towards a vacation one day.

• You want a simple travel credit card: You're not interested in all the airport lounge and upgrade offers made by other cards — in fact, talk of miles and frequent flyer programs confuses you. This card is simple to follow and simple to use: you can use your miles for statement credit for a travel-related purchase.

  Discover defines a travel purchase as: airline tickets, hotel rooms, car rentals, travel agents, online travel sites and commuter transportation.

• You're a fan of Discover and want to try something new: This card is fairly new but has many similar perks as other Discover cards (including the Freeze It security option and free FICO score).

Credit Card Promotions You Should Not Ignore

Reasons to Get This Card

• No Annual Fee: Travel reward cards usually have an annual fee, so it's a pretty big deal that the Discover it Miles card has no annual fee whatsoever.

• Reward Structure: The reward structure of this card is very simple — all spending earns 1.5 miles per dollar. At a conversion rate of 100 miles to $1 in reward redemptions, that's an effective rewards rate of 1.5%.

• Promotional Miles Offer: New cardholders get a special perk at the end of their first year as cardholders: Discover matches all the miles you've earned during that entire first year. So if you earned 20,000 miles, you'd get an additional 20,000 credited to your rewards account as a bonus. And there's absolutely no limit to the amount of bonus miles you can get. This means an effective reward rate of 3% on purchases for the first year.

• No Foreign Transaction Fee: International travelers will appreciate the lack of a foreign transaction fee. Many other credit cards charge a 3% fee on purchases made outside the United States.

• Intro APR for 14 Months: There is an intro 0% APR period of 14 months for purchases (after that, a 17.24% - 28.24% Variable APR). Perhaps you're planning to book a large trip soon? You'll get some breathing room before you have to pay it off.

• Free FICO Credit Score: As with other versions of Discover it credit cards, the it Miles card includes your credit score on your statement each month — completely free.

  And Discover offers cardholders a free identify theft alert service. This service sends you an alert if your social security number is being used on the dark web and/or if any new credit cards, mortgages, car loans, or other accounts have been opened in your name. This helps protect yourself from identity theft and fraud.

Reasons to Look Elsewhere

• You Could Find a Better Rewards Rate: Many travel rewards cards offer opportunities to earn extra miles or points on your regular spending, which can up your effective rewards rate to north of 2%. There are no such opportunities with the Discover it Miles card — you're locked in to the 1.5% rate. That's pretty good for a card with no annual fee, but depending on your spending patterns, you may be able to earn more rewards elsewhere.

• No Transferring of Miles: Even though you earn "miles" with this card, they're more like points. And you can only redeem them for statement credit toward travel purchases. You cannot transfer miles to a frequent flyer program, which oftentimes offer the best value for each mile.

• Acceptance May Be Limited: Discover cards are not as widely accepted by merchants as Visa and MasterCard. That might be an issue when you shop at smaller, locally owned businesses that are less likely to be part of Discover's network. And though there is no foreign transaction fee, some overseas merchants may not accept it.

Our Opinion: Is the Discover it Miles Worth It?

© CreditDonkey

Overall, this is a good general, all-purpose travel rewards credit card, especially if you really want one with no annual fee (which is not common for travel rewards cards). It also has a generous promotional offer of matching all miles earned at the end of the first cardholder's year. Some other travel cards offer a better effective reward rate, but they have annual fees. The 1.5% flat rate offered by Discover it Miles is excellent, considering it has no annual fee.

One serious downside of the Discover it Miles card is that you're pretty much limited to only using it to redeem travel-related purchases. You are able redeem miles for straight-up cash back, but it's hardly even worth mentioning, because the redemption rate is only half as great (0.75%).

So considering that the highest reward rate you get is 1.5%, you may feel like you'd be rewarded better with just a straightforward cash back card. The Citi Double Cash might offer more rewards, but it has no sign-up bonus. However, you'll have greater flexibility in how you use it, not to mention that it's more widely accepted by merchants. Even cards like Chase Freedom Unlimited offer a flat 1.5% cash back rate.

The bonus miles match is a huge draw, but let's do the math: If you spend $10,000 on your card in the first year, that equals 15,000 miles ($1 = 1.5 miles). Discover will match that 15,000 miles, which equals $150 in statement credit (100 miles = $1). This is a large amount to spend to get $150.

It really depends on what you want this card to be used for. It's actually a very good basic travel rewards card with no annual fee, and the 1.5% reward rate is very decent. But considering that you're limited to what you can redeem points for, you may want another card that offers more back. The thing that makes this card good for travel is that there is no foreign transaction fee (assuming overseas merchants will accept Discover).

How it Compares

If you're still not sure whether Discover it Miles if right for you, let's look at some other cards that may suit your needs better.

If you like Discover but prefer cash back:
Discover it credit card: The sister card of the it Miles is the regular Discover it card, which is more of a general purpose rewards card as opposed to a travel rewards card. Like the it Miles, the regular Discover it card has no annual fee, but the reward structure is quite different. Instead of a flat 1.5% rate, the Discover it earns rewards at a base rate of 1%, with the opportunity to earn up to 5% when you buy things that fall under the "bonus" spending categories that rotate quarterly throughout the year. It will also match all the cash back you've earned at the end of the first year for new customers.

If you spend a lot on travel and dining out:
Chase Sapphire Preferred: Chase Sapphire Preferred comes with a host of travel and purchase protections, and boasts a 1:1 point transfer rate to many popular frequent flier programs. There's an annual fee though. If most of your spending is outside of travel and dining, the 1.5% effective rewards rate of Discover it Miles will still be your best bet.

That said, depending on how you value transferring miles to airline transfer partners, the Sapphire Preferred might still be worth your consideration.

Is It Worth It?

To review, here are the main pros and cons when considering the Discover it Miles:

Pros:

• Flat 1.5% reward rate on all purchases
  
• Matching of all miles earned at the end of the first year
  
• No foreign transaction fees

Cons:

• No transfer of miles
  
• Not a Visa/MasterCard

For a travel rewards card with no annual fee, the Discover it Miles is a pretty good card with a simple rewards structure and a great bonus opportunity. We've already talked about our opinion at length, so to recap:

It's a good choice if you're looking for a simple, easy-to-use travel rewards card. The 1.5% reward rate is pretty good and you don't need to keep track of your spending patterns. However, you are limited to only redeeming for travel purchases, so if you want more flexibility, you may find a better reward rate and more value in a straightforward cash back card.