How to Maximize the Discover It 5% Bonus for Q3 2018: Restaurants

The Discover It 5% cash back category for Q3  (July-September) 2018 is restaurants. As a reminder, you need to activate the 5% promo to receive the cashback bonus. Earn up to 5% on up to $1,500 in combined category purchases when you activate.

If you're in the first year of your Discover It card, then the 5% cash back is 10% with Cashback Match. 

I'm glad the Discover It and Chase Freedom cash back categories are different this quarter. Restaurants should be a relatively easy category to max out. 

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What qualifies as a restaurant?

Restaurant purchases are those made at merchants that code as full-service restaurants, cafes, cafeterias, and fast food locations. 

If you're not sure that a merchant or retailer codes as a restaurant, be sure to do a test transaction first to see if it codes properly. 

Important: purchases made with mobile pay programs and virtual wallets might not qualify.

If you plan on buying gift cards to maximize the quarter, be sure you're buying the gift cards directly from the restaurant and not a third party service. The third party will not code as a restaurant (i.e., buying Chipotle gift cards on or Target).

Chase Sapphire Reserve vs. Discover It Dining

The Chase Sapphire Reserve earns 3x back on dining; should you use the Chase Sapphire Reserve or Discover It for dining purchases in Q3 2018?

For most people, especially if you're in the first year of the Discover It card (10% Cashback Match), it might be easier to optimize for cash back. 

If you plan on redeeming Ultimate Rewards via transfer partners, then it makes sense to use the Chase Sapphire Reserve to earn points, as opposed to 5% cash back with the Discover It. 

1. Discover It = 5% cash back

2. Chase Sapphire Reserve = 3x Ultimate Rewards

     a) Travel Portal = 1.5 CPP = 3x * 1.5 = 4.5% ROS

     b) Transfer Partners ("min") = 2 CPP = 6% ROS

     c) Transfer Partners ("max") = 3 CPP = 9% ROS


CPP = cents per point (real value derived from points)

ROS = return on spend (percentage of value derived)