Chase Freedom® vs. Chase Freedom Unlimited® vs. Discover it®

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In a Nutshell

Three cash back cards, and only one can be crowned the winner. If you're willing to put in a little extra work, Discover it® beats two strong entries from Chase.

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Three cash back cards — Chase Freedom®, Chase Freedom Unlimited® and Discover it® — are likely to pop up on your radar as you’re sorting through credit card choices.

But how to decide which one is best for you? We did the homework for you and discovered that Discover it® outdoes the two Chase® cards in several key areas, including sign-up bonus, annual percentage rate and foreign transaction fee.

All three cards are worthy of being in your wallet, but if you’re willing to work a little harder for your rewards, Discover it® can yield the most cash back, in part due to its dollar-for-dollar match for cash back earned during the first 12 months you own the card.

But it you prefer a simple no-fuss cash back card, Chase Freedom Unlimited® might be the smartest option. We’ll dive into the details below.

Best for sign-up bonus

The Chase Freedom® and Chase Freedom Unlimited® both offer a $150 sign-up bonus for spending $500 in the first 3 months of account opening. By contrast, the Discover it® card matches cash back rewards earned during the first 12 months.

The cash back match for the Discover it® card could exceed the $150 bonuses offered by the Chase Freedom® and Chase Freedom Unlimited®, depending on your spending activity. You’ll essentially earn 2% cash back on all purchases and a whopping 10% cash back on purchases in quarterly bonus categories (up to the quarterly cap) for the entire first year as long as your account is not closed and you’re still in the cash back reward program at the time Discover calculates your potential award.

Best for rewards

If you’re willing to keep on top of the rotating rewards categories for Chase Freedom® and Discover it®, these cards beat Chase Freedom Unlimited® in the rewards department. Both the Chase Freedom® and Discover it® cards offer 5% cash back on up to $1,500 in combined purchases in bonus categories that rotate every quarter.

Here’s the catch: If you want to take advantage of the rewards category in any given quarter, you must activate that rewards category through your account. Chase Freedom® offers an online dashboard for activating a quarterly rewards category, while Discover it® has a special page for that task.

From our partner

Chase Freedom®

From cardholders in the last year

With Chase Freedom® and Discover it®, if you don’t activate the quarterly 5% offer for cash back before that card’s deadline, then you’ll earn just 1% in the rotating categories and the standard 1% for all other purchases. On the other hand, Chase Freedom Unlimited® offers a flat 1.5% cash back.

Both Chase Freedom Unlimited® and Chase Freedom® track their cash back rewards as points, with each point worth 1 cent when redeemed for cash back. For instance, for each $1 spent with Chase Freedom Unlimited®, you’ll earn 1.5% cash back, or the equivalent of 1.5 cents.

You can convert Chase Freedom® and Chase Freedom Unlimited® points into cash through a statement credit or an electronic deposit into an eligible checking or savings account. Other redemption options include gift cards, travel and merchandise.

From our partner

Chase Freedom Unlimited®

From cardholders in the last year

See Details, Rates & Fees

The rewards component of the Discover it® card works differently.

You can redeem your Discover it® cash back as a statement credit, an electronic deposit into a designated account, or a donation to a charity.

But the most attractive redemption option for Discover it® is converting cash back into a gift card or e-gift card from dozens of partners. Why? With a minimum $20 redemption into a gift card or e-gift card, you’ll may get $5 added for free.

Best for card benefits

If you’re an international traveler, one of the outstanding benefits of the Discover it® card is the lack of a foreign transaction fee. Chase Freedom® and Chase Freedom Unlimited® both charge a 3% foreign transaction fee.

Keep in mind, though, that Discover it® isn’t as widely accepted by overseas merchants as cards under the Visa® and Mastercard® banners. For what it’s worth, both Chase Freedom® and Chase Freedom Unlimited® are Visa® cards.

Also, Discover it® doesn’t charge a penalty fee on your first late payment. After multiple late payments though, you’ll be charged up to $39. Chase Freedom® and Chase Freedom Unlimited® also assess late payment fees of up to $39, but they won’t forgive your first mistake.

What to consider when applying for a cash back card

A cautionary note: The APRs for cash back cards are typically higher than the average APR across all credit cards. With that in mind, this kind of card is great for someone who always pays the balance in full every month. Otherwise, any cash back the cardholder receives could be wiped out by monthly interest charges.

What is the average APR on a credit card?

Another key piece of advice: Choose a cash back card that matches your spending habits. If you spend a lot in one category, like grocery stores, make sure you pick a card that offers more cash back in that category.

Also, give some thought to whether you’ll earn enough cash back to offset any annual fee that the card imposes. If a card carries an annual fee of $95 but you figure you’re likely to accrue less than $95 in annual rewards, then the value of the cash back is diminished. Fortunately, none of the cards in this review charges an annual fee.

Of course, you’ll also want to pay attention to how generous a card’s sign-up bonus is, as well as how easy or difficult it is to redeem cash back rewards.

Which card is right for you?

Discover it® offers a few distinct advantages over Chase Freedom® and Chase Freedom Unlimited®.

You must consider the upfront benefits of each card’s sign-up bonus, says Roman Shteyn, co-founder and CEO of RewardExpert, a service that helps people maximize travel points and miles. Between the two rotating-category cards, Discover it® offers the higher potential return, at least in the short term, he says.

The Discover it® card’s dollar-for-dollar match will give new card members the chance to earn more in the first year than Chase Freedom Unlimited®’s and Chase Freedom®’s $150 sign-up bonuses.

And let’s not overlook the ability to boost the value of the Discover it® card’s cash back by converting rewards into gift cards. At the very minimum, you may gain an extra $5 by spending $20 on a gift card from one of Discover’s partners.

In the end, you have to ask yourself whether you’re willing to go the extra mile to reap even more cash rewards. The Discover it® card offers higher cash back but requires a bit more work to earn it. Also, note that the Discover benefit requires delayed gratification — you won’t get Discover’s dollar-for-dollar match until after your first year of having the card.

If you’re able to stay on top of the quarterly categories, rotating-category cards like Chase Freedom® and Discover it® are a good choice, says Shteyn. But, he adds, “if you don’t want the fuss of having to activate your bonuses every three months, then Chase Freedom Unlimited® card is a solid choice.”