About two months I experienced a rather rude financial awakening. My massive debt aversion over the last 24 years (well, I doubt I cared much as a child so let’s say 13 years) resulted in a lack of credit history. My one credit card I’d been using since 2007 simply wasn’t providing enough history. This fun fact was unearthed when I used the much-raved-about Credit Karma to try and get my free FICO score. Credit Karma accepted all my information to promptly explain I had a “thin file” which meant they could not produce a score. They were kind enough to suggest ways I might improve upon my failings which basically were just to use debt tools (ie: loans and credit cards) to increase my credit history.
Taking out a loan for the sake of taking out a loan seemed dumb so I decided to try opening another credit card. I’d long been the delighted recipient of credit card offers in the mail which always ended up in the trash. Now, I started to actually read the offers and narrowed my search down to a Capital One card or the Discover it card.
While Capital One does offer better slightly better cash back (1.5% on everything while Discover is 1% with rotating categories for 5%) the Discover it card promises of a free FICO score, no annual fee and non-outsourced customer service won my heart. Plus, I think their commercials are funny (but Capital One did have Alec Baldwin…I’m a marketer’s dream…)
The free FICO score was important because the Credit Karma and Credit Sesame products of the world don’t work for me. Funnily enough, both Discover and Credit Karma pull their data from TransUnion (one of the three major credit bureaus) to produce their scores. I just don’t flag for Credit Karma… It should also be noted that by having a FICO score from only one of the three credit bureaus you aren’t seeing the full-picture of your credit score because you may have a different number at each bureau. To truly know your score you’d have to get reports from all three bureaus, but this single report way will still give you a good approximation.
If you’re interested in opening a Discover it card, either because of the FICO score or hilarious commercials, here is my assessment after about two months of using one:
Free FICO score (obviously)
I don’t need to expand more, but I like having the access to my score each month so I can monitor for major fluctuations. However, this shouldn’t replace proactively checking credit history reports, which don’t provide a score but are free once a year, with TransUnion, Experian and Equifax to monitor for any red flags.
Customer service calls aren’t outsourced and are pleasant
I’ve only had to call once — to set up the card — but I do appreciate that the calls are in the US. Yay for helping improve employment and apparently with friendly people because my call was very pleasant. This might have to get revised if I ever need to phone in a complaint.
Widely accepted by merchants/retailers
My first credit card is a MasterCard and I’ve never had it get rejected, but I’d seen friends get their American Express cards turned away so I wanted to ensure my second card would be widely accepted. Thus far, I’ve only encountered one restaurant that didn’t take Discover out of the various locations I’ve used the card.
You get 1% on all purchases with a rotating 5% cash back in various categories. Plus, you get a $50 kickback the first time you make a purchase within 3 months of opening the card.
In a shameless plug, I ask that you scratch my back a bit if you plan to get the Discover it card and use my referral link (here) so I get a “finder’s fee” if you will.
Least Favorite Features:
Have to enroll to get the 5% cash back
While it’s really simple to opt in, and they send you email reminders, it irks me that this isn’t automatic (and yeah it’s to save the company money on those who don’t take the 17 seconds to sign up).
Cash back categories don’t always apply to me
The first quarter of 2014 I was able to really utilize cash back because it was on movies and restaurants. I usually go out to eat once a week (hello brunch) and I’ll treat myself to an overpriced movie ticket on occasion. Unfortunately, the cash back category for the second quarter is on home improvement stores, furniture stores and Bed Bath & Beyond. Ehh. My mom would love this category but I don’t have any big plans to be utilizing those stores in the near future, unless my landlord lets me paint the apartment…
What ways have you gotten a FICO score for free?
Special thanks this week to….
J. Money from Budgets Are Sexy for mentioning my post “An Impassioned Plea for Understanding Compound Interest” as inspiration for his own story on the 8th wonder of the world. Thanks to Economag for reprinting it recently which prompted J. Money to see that hidden gem from last June.
Cat from Budget Blonde for mentioning me in a stellar lineup of lady bloggers in her edition of Women Power Wednesday.
Shannon from Financially Blonde for saying our chat over a couple of brews inspired her to write this great post about getting over investing fears! And a belated thanks to her for including me in her Women Power Wednesday and for coming up with the whole idea in the first place!
[Discover it image from Flickr]