There are countless credit cards on the market today, and there are plenty of good ones too. So why would I want to apply for another Discover it credit card? And what should you pay attention to during the application process?

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[Updated 10/23] When you log in to your Discover account now, if you have two Discover cards, you may see an option to combine the accounts. Having both cards under one login is much more convenient. However, it seems this option is not available to everyone. See details in this article.

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From Miles to the Memories

Discover it Credit Card Overview

The Discover it credit card is not hard to get approved for, and it is a great starter card for beginners. You may even be able to get it with no credit history at all. My first Discover card was approved right after I arrived in the U.S. and had just received my SSN. I called in to verify my identity, and was approved immediately. But easy approval does not mean this is a bad card. On the contrary, I think this card ranks in the top three among all no-annual-fee credit cards.

Its main advantages are as follows:

  • [Expired] Excellent Apple Pay promotion: From now through December 31, 2015, purchases made with Apple Pay at merchants can earn an extra 20%-30% cashback (an extra 10%-15% after 2-3 billing cycles following the purchase, and the remaining 10%-15% on your cardmember anniversary). For detailed analysis, see: Overview of the Discover Apple Pay Offer
  • Double cashback: All cashback earned from account opening through your first card anniversary will be doubled (including the $50 sign-up bonus, the regular 1%, quarterly 5%, and the 5%-15% from Discover deal). For details, see: Discover Double Cashback Promotion
  • Flexible cashback redemption: Cashback earned with Discover can be redeemed directly as cash at a 1:1 ratio. More importantly, it can also be used for discounted gift cards from many merchants: rental car certificates at 50% off, Staples at 20% off, sears, BBB, Macy's, and Starbucks at 10% off, and shell gas cards, Whole Foods, and more at 7% off
  • Quarterly 5% cashback: Each quarter has different 5% bonus categories, including gas, department stores, Amazon, and more
  • No annual fee, free FICO credit score, quarterly 5% cashback, good student rewards, and no foreign transaction fee (especially convenient for spending in China)
  • For a more detailed introduction, see: Introduction to Discover Credit Cards

Why Apply for a Second Discover it Credit Card

I spent a lot of time above talking about the benefits of the Discover it credit card mainly to set up this discussion of why it may make sense to apply for a second copy of the same card. The benefits of opening another Discover credit card include:

  • Increasing your Apple Pay cashback cap
  • Getting the double cashback promotion
  • Increasing your quarterly 5% cashback cap
  • Credit history considerations

Apple Pay cashback cap (expired)

The 22%-30% cashback through Apple Pay is capped at the first 10,000 in spending, which means you can earn up to $2,200-$3,000 back. Discover also excluded gift card purchases from the Apple Pay Offer, so for most people it is not easy to spend the full 10,000. But for certain groups, such as people doing purchasing for others or reselling in the U.S., spending 10,000 is no problem at all. And now Apple Pay is accepted at several major stores, such as Apple Store, Macy's, Staples, and Best Buy. Earning 22%-30% back at these merchants can mean huge profits. So if you have already maxed out the Apple Pay 10,000 spending cap but still need to buy cosmetics, Apple products, and similar items for "family back home," you may want to consider applying for another Discover it credit card.

Double cashback promotion:

When this promotion first launched, all cardholders could participate and receive double cashback for one year. However, Discover later changed the rules so that only new applicants could participate. New applicants are automatically enrolled after activating the card, and they will receive an email like the one shown below.

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The January 2017 date here refers to the first statement after my card anniversary (I opened the card in early December). So all the cashback I earned from 2015.12 through 2016.12 would be doubled. If you have questions about the double cashback offer, see the official Q&A: Official Double Cashback Q&A. If you were not enrolled in the double cashback promotion, you can consider opening a new Discover card. That way, regular spending can earn 2% cashback, quarterly categories can earn 5%, Discover Deal can earn 10%-30% cashback, and Apple Pay can earn 20%-30%, which is pretty awesome.

Increasing the 5% quarterly cashback cap

Each quarter, Discover offers 5% cashback in designated spending categories. These categories include:

  • Q1: Gas and public transportation (according to the official website)
  • Q2: Home improvement or dining (guess)
  • Q3: Dining, Amazon (guess)
  • Q4: Department stores, Amazon purchases (guess)

These 5% bonus categories all have spending caps: only the first $1,500 qualifies for 5% cashback. But for new Discover users, the first year effectively becomes 10% cashback in those quarterly categories, which is very attractive. You might ask: I'm a student and my spending is low. I can't even spend $1,500 in a quarter, so why would I consider a second Discover credit card? Then the cap becomes $3,000, and I still won't be able to max it out!

One way to solve this is by buying gift cards you actually need from merchants in the bonus categories. If you do it well, that 10% cashback can be cleverly shifted to all kinds of spending categories, effectively giving all your spending 10% cashback. For more analysis, see: Credit Card Tips — Converting Spending Categories. Of course, after the first year of 10%, you only get the standard quarterly 5% cashback in the second year. But that is still fine. Combined with your original Discover credit card, you can average up to $1,000 per month in spending eligible for 5% cashback, which should be enough for most people.

Credit history considerations

Applying for a new credit card will affect your credit score. The positive impact mainly comes from the possibility of increasing your total credit limit. The negative impact comes from two sources: the score drop caused by the HardPull inquiry when you apply, and the score drop from opening a new credit card account. The effect of opening a new card cannot be avoided, because the new account will be reported to all three credit bureaus and therefore affect your score. A HP, however, will appear only on one or several specific bureaus. Discover usually pulls TU, and a HP on that bureau will not affect your scores with the other bureaus (EX, EQ). The key point is that Chase, AMEX, and Citi most often pull EX, so a Discover credit card HP on TU generally will not affect applications with issuers that pull EX.

One more mildly amusing point: for those who are really into tracking their credit score, if you have two Discover credit cards, you can get two free credit scores each month. If one statement closes at the beginning of the month and the other in the middle, then you’re basically getting an updated credit score every 15 days.

For more questions related to credit scores and credit history, see: Introduction to Credit Scores and Credit History

Things to Watch Out for When Applying for a Second Discover Credit Card

After all of the analysis and discussion above, if you’re tempted, you may want to consider applying for a second Discover credit card. If you apply before the end of the year, you may still be able to catch the Apple Pay Offer and the department store/Amazon 10% cashback offer that ends on December 31. If you’ve already decided to apply for a second card, pay very, very close attention to the following points:

  • If you have held your first Discover credit card for less than one year, you will not be able to get a second one.
  • Whether your first Discover card is the student version or the regular version, when filling out the application for a second Discover credit card, you must apply as a non-student.
  • If your current Discover credit limit is not high, you can request a credit limit increase online a few days before applying. If approved, it will be a soft pull and will not affect your credit score; if the process says they need to pull your credit report, then do not proceed, because that would be a hard pull. The reason is that when you call the reconsideration line later, the representative may need to move part of the credit line from your first card to the second one.
  • After submitting the application, if it shows pending or asks you to submit materials, call the reconsideration line directly: 888-676-3695
  • Once you get connected with a representative and verify your identity, state clearly that you do need a second Discover credit card and that you do not want to close the first one.
  • You can give your own reason for wanting the second card. Usually it’s something like wanting more use of the quarterly 5% categories, or that the new card has the double cashback promotion.
  • After the representative tells you the second card is approved, you can confirm the sign-up bonus and the double cashback promotion.
  • Do not apply directly through the official website. The official application link does not come with a sign-up bonus. Keep that in mind!
  • You’re welcome to use our referral link when applying:
  • Some readers reported that when they used their own refer link, they did not receive the sign-up bonus. Discover may have changed the terms of the refer program. You can decide for yourself whether to use your own link or ours.

Here is my personal experience:

  • First, I used a soft pull to increase my credit limit from 1000 to 2000.
  • The first time I applied, I marked myself as a student. After submitting the application, I got a message saying “you reach the limit for Discover card,” and the application was denied immediately. No matter how you call the reconsideration line, they still won’t approve that specific application. However, this kind of denial should be a system denial and should not result in an HP.
  • I immediately submitted another application online (filled out a completely new one), this time not as a student. At that point, the application may go pending and ask you to upload bank statements or your driver’s license and SSN to verify your identity.
  • Don’t submit the documents. Just call the reconsideration line directly at 888-676-3695.
  • Explain that you need a second Discover it credit card. The representative then told me that I needed to reallocate part of my credit line, so I moved 1000 in credit line and was approved right away. Now both cards have a 1000 credit limit, which is basically enough for my needs.

Summary

Whether you need a second Discover credit card is something you should decide for yourself. If you do get a second one, there’s no need to close it. After all, it’s a good no-annual-fee card, and at the very least you can keep it to help extend your average credit history.