It’s a very bright idea for someone trying to make the credit cards more money, however. Perhaps even brilliant.
The premise behind the Discover Motiva Card is that they’ll reward you for being a good customer. 6 months of paying your bills on-time and you get the next month’s interest back.
That right, next month’s interest.
Essentially, it’s giving you no interest for one month every 7 months (6 months of interest and then the next month’s interest back). If you’re being a responsible credit card user, want to guess how much money you’ll get back from that? I put it at…oh $0.
Now we can retire and live like kings!
It’s fascinating. They know that it’s not great for the company when people take advantage of good cashback rewards programs without paying interest. On the other hand, the company thrives if you’re carrying a balance and paying them the monthly interest.
So they’ve come up with a program that specifically rewards you for carrying a balance and really only for carrying a balance. It’s even framed to make you feel like a savvy consumer. As for the money they’re “rewarding” you with, you could save yourself 6x as much or more just by not carrying that balance in the first place.
Very bright idea for them, not a bright idea at all for you.
The good (?) news is that it’s also a cashback bonus rewards card. You get some nice rewards (5%-20% want to bet it’s mostly 5%?) if you shop through the Discover store online (I wonder what they make off that and what the markups are!). The bad news is that it’s only up to 1% on anything else. “Up to” really could mean anything…..like 0.0001%.