Pros/Cons of Discover's Cashback Debit Checking Account
Does anyone recommend Discover's Cashback Debit account? I've just discovered it exists and it sounds like a great deal. If you would recommend something else, please explain why? I'm trying to improve my understanding of personal finance. The concepts are fairly new to me in general. Thanks for your input!
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Just went and read about it. Mostly cons for me. You'd have to do most spending on a debit card that's not as safe as using a credit card. You only get 1% back where I get 2% with my Citi Double Cash card. Plus, the cash back is limited to $3000 per month.
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Superbone We already do most spending on a debit card (credit limit is only 300 currently) and it will be awhile before we qualify for any credit cards with rewards. I don't think we would typically go over 3000 in a month since that doesn't include loan payments and such. However, Purple Panther gives me pause by pointing out issues with Discover being accepted.
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It might be a decent deal if you're spending less than $3,000 on valid purchases, but they don't count Venmo, Paypal, Apple Pay Cash, loan payments, and certain other types of transactions, so you might lose out there. Also I don't know if people have this problem elsewhere, but I've found in New York and California where I've lived, a lot of establishments simply don't accept Discover cards. I've seen my friends' Discover cards get verbally rejected over and over again.
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I would see it as a good option if you are:
- Comfortable with fully online banking with less/no banker interaction.
- Debit card user and do not want to use CC, but do not want to lose out on some cash back opportunity.
- Is Discover accepted in a lot of places around where you live?
I had a brief time, where I paused my CC usage completely, at which time I pondered about Discover bank. But I did not choose them as I preferred a bank with local branch for checking. -
I found the transfer and hold times for discover to be slow. Also minimum transfer amount is $25 which just annoys me that they would stipulate a minimum amount.
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Alice Blue Tiger Looks like they might be faster now, I initiated a transfer from my local credit union on Friday and they say it will be in my Discover cashback account today. But who knows, maybe I was just lucky? Anyway, a year ago it seemed like the same transfer would take up to a week.
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We've been banking with discover since April of 2019. The cash back is nice (we always make the 30/month which is helpful to morale). That being said, I'd caution you that we have a lot of issues with the website infrastructure- it's clunky and not intuitive which is a major downside for a bank that is entirely online. The other thing that is driving us INSANE is that discover loves to suspend our account for normal, regular transactions like grocery store purchases in our neighborhood store. We're likely switching accounts soon; the only reason we've waited so long is that I'm a nurse on a covid unit and don't feel comfortable going into a bank branch to open a joint account.
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My BF has a credit card with discover and I DO NOT LIKE IT. Their website is horrible when it comes to navigation and understanding your charges/what you owe/balance. And they have a habit of nickle and diming you every chance they get. We rolled over a zero percent balance transfer into that card, and as soon as the promotional period is up we'll roll it off of there and the BF will just not use that card because it's such a pain, and they are so irritating to deal with.
If you haven't explored Capital One's products, I would encourage you to look into those. I believe they have a debit option, but I'm not sure. I DO know that out of all the companies out there I was able to get a credit card with them back when my credit was crap (when I actually had no credit at all), and my BF was able to get a card with them when his credit was really low due to employment issues. They are very generous when it comes to lending. The up side is that their website is clear and easy to navigate. It's EASY to see how much you owe, how much the balance is, and how much is available. And they've got rewards cards that are petty good. I've never had a problem dealing with them, or getting anything fixed if there was an issue.
Good luck! I hope you find something that works for you!
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farfromtheusual I have a few Capital One cards that have the first three slots on my Debt Smackdown list, and my plan get rid of the cards. The big reason for me is why they are not wanting to play nice with Plaid. Its my data to use as I see fit. If they want to have a spat with the data processors like Plaid and MX, so be it. I'll take my business else where.
I switched to Ally towards the end of June, and so far they have been great.
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