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Discover Card Rewards Catalog
Posted By Jim On 10/15/2009 @ 12:02 pm In Credit | 16 Comments
Today we’ll be taking a look at the Discover Card rewards catalog, the final in our series of reward catalog reviews . The reason I kept Discover for last was because it’s less widely accepted and because their rewards catalog is very simple. Until taking a look today, I didn’t even know they had a rewards catalog because I always converted my cash back rewards into statement credits. When Citi converts points into cash at 0.69¢ and American Express does it at 0.60¢, I’ll take the full value 1¢ every single day.
However, there are instances where you may not want cash.
Discover is the least sophisticated of the reward catalogs but one of the most rewarded. On most of their cards, you don’t accumulate points, you accumulate cash back. You can always convert the cash back directly into cash but you are given the opportunity to get a bonus if you convert it into something else such as some products, gift cards, or charity donations.
Discover’s product catalog is significantly smaller than other reward catalogs. As of this writing there were only 27 products, seven of which were different varieties of Apple iPod nanos, shuffles, and touches. It’s hard to say how their gift card selection compares, since it’s fairly sized and at least on par with other reward catalogs.
The best reward in the Discover catalog is, of course, cash. Since you accumulate your rewards in “cash,” the conversion is simple – you get a penny for each penny of cash back you’ve acquired. This gives values each penny at 1¢, which is far better than the 0.69¢ at Citi and 0.60¢ at American Express. One limitation of requesting cash or a statement credit is that the minimum redemption amount is $50.
I looked at a bunch of products and none of them offered a good deal. Since your rewards are valued as cash, the decision is simple. If you can buy it cheaper on the street, it makes no sense to redeem your cash back for it in the catalog. In every case I looked at, I found the product cheaper by Googling the product name and picking a reputable vendor that appeared.
However there are certain gift cards in the catalog that will give you a better than $20 to $20 gift card conversion. If you look through the catalog at restaurants, you will usually see a conversion rate better than 1¢. Sometimes they offer a $25 gift card for $20 in cash back rewards (Ace Hardware, Men’s Wearhouse, etc.) , sometimes it’s a $50 gift card for $45 (Chili’s, Olive Garden, Red Robin, etc.), and in rare cases it was doubled, a $40 gift card for $20 (Alamo Rent A Car, Princess Cruises, etc.). Fortunately you can see the rewards based on value (Double Your Reward, $30 for $20, $25 for $20, $50 for $45, etc.)
If you regularly shop at these places, it might be worth your while to redeeming your cash back rewards as a gift card as it values it at greater than 1¢ a piece!
In terms of value per reward point, in this case it’s already cash back, you can’t beat Discover Card. In every other catalog, you had to convert points to a $100 gift card before you could get a penny a point in value. With Discover, you start at a penny a point and work your way up to as high as 2¢ in value at the Double Your Reward merchant gift cards.
What’s nice about starting at 1¢ is that you know your 1% or 5% in cash back rewards is actually 1% or 5%. If you have a Citi card, you have to discount it by 30% so 1% in points is actually worth only 0.7% in cash. If you have an American Express card, 1% is only 0.6% in cash rewards. No need with Discover.
Now we just need more places to accept it!
(Photo: thetruthabout )
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