Double dipping Discover’s 3rd quarter categories

Thanks to Discover’s offer to double all cash back for a year, their quarterly 5% categories are more interesting than ever.  Now, instead of earning 5% for those categories, cardholders enrolled in the Double Cash Back offers, will ultimately earn 10%.

Double Dipping Discover

This quarter, July through September, Discover is offering 5% cash back for up to $1500 in spend at Home Improvement Stores, Department Stores, and Amazon.com.  For those enrolled in the Double Cash offer, this is a great deal.  Even if you don’t plan to buy anything in those stores, you could buy Visa gift cards and merchant gift cards in-store at a number of them, including Home Depot, Kohl’s, Lowe’s, and Sears.  Amazon.com sells gift cards too.

What if you do have plans to make purchases at these stores, though?  Could you do better than 10% cash back?  Of course…

Double Dipping Discover

A simple double-dip involves going through an online portal to a qualifying store and then paying with your Discover card.  Ideally, you would use the Discover Deals portal since cash back earned from that portal will be doubled as well.

On Discover’s 5% CashBack Bonus page, they show examples of stores that qualify.  This is far from a complete list, but it’s a good starting point.  I cross referenced the example list of qualifying stores with stores found on the Discover Deals portal to see which stores will easily qualify for a double dip.  Here are the stores that appeared in both places:

Home Improvement Stores Cash Back via Discover Deals
Ace 5%
Home Depot 5%
Lumber Liquidators 5%
Department Stores Cash Back via Discover Deals
Bloomingdales 5%
Bon-Ton Stores* 5%
Dillard’s 5%
JCPenney 5%
Kohl’s 5%
Lord & Taylor 5%
Macy’s 10%
(through August 31)
Neiman Marcus 5%
Neiman Marcus Last Call 5%
Nordstrom 5%
Saks Fifth Ave & Off Fifth 5%
Sears 5%

* Bon-Ton Stores include: Bergner’s®,Boston Store®, Carson’s®, Elder-Beerman®, Herberger’s®, PARISIAN, Younkers
** Amazon.com is not available through the Discover Deals portal, but you can get 6% cash back by clicking through from TopCashBack for certain types of purchases.

As you can see above, many stores that qualify for Discover’s 3rd quarter 5% categories are also available for 5% cash back through the Discover Deals portal.  So, those enrolled in the Double Cash Back offer can easily get 20% cash back:

  • Click through Discover Deals to the store in question
  • Buy items and pay with your Discover card

You’ll get 5% back from the portal + 5% back from the credit card, and both will be doubled at the end of the year.

Triple Dip?

In a few cases, it may be possible to earn 3 times the rewards, as follows:

  • Click through Discover Deals to the store in question
  • Buy a gift card for that store and pay with your Discover card
  • Click through Discover Deals to the store again.
  • Buy merchandise and pay with your gift card

In situations where this works, you can earn 5% from your credit card and 10% from Discover Deals (since you’ll have earned 5% twice).  Then, via end of year doubling, you’ll total 30% cash back! That said, it’s very important to understand that this will not work at most stores.  Most stores do not offer portal rewards when you purchase gift cards and some do not offer portal rewards when you use gift cards.

Triple Dip Candidates

Using the list of stores identified above, I looked up each one in the Frequent Miler Laboratory to see if a triple dip is likely to work.  Here’s what I found:

Home Improvement Stores Earn portal rewards when buying gift cards? Earn portal rewards when using gift cards? Analysis
Ace No data
Home Depot No Yes Most reports suggest that the double dip won’t work
Lumber Liquidators No data
Department Stores Earn portal rewards when buying gift cards? Earn portal rewards when using gift cards? Analysis
Bloomingdales Maybe (mixed reports) Yes (very old report) This double dip might work, but its risky
Bon-Ton Stores No data
Dillard’s No data
JCPenney No Yes Probably won’t work
Kohl’s Reports are mixed. Only physical gift cards work. Yes This used to be a dependable double dip, but I haven’t received any recent reports of success. Risky.
Lord & Taylor No Data
Macy’s No Yes Won’t work
Neiman Marcus Yes (reports are mixed, but most report success) Yes This one should work
Neiman Marcus Last Call No data, but I expect that it would work the same as Neiman Marcus
Nordstrom No Yes No direct double dip opportunity
Saks Fifth Ave & Off Fifth Yes (physical gift cards work, but not e-gift cards) No data on the use of gift cards, but it’s likely that the double dip will work.
Sears Yes Yes This works, but it’s very important to buy e-gift card or reload existing gift card. Physical gift cards are sold by Kmart and will not be eligible for 3rd quarter 5% bonus.

As you can see in the table above, Neiman Marcus, Saks, and Sears are all candidates for the triple dip.  If you try it, please keep in mind that your results may vary.  There is no guarantee that this will work for you.  Also make sure to attend to the details noted in the table above:

  • Sears: Buy e-gift cards or reload existing gift cards. Physical gift cards will not result in earning the 3rd quarter 5% bonus.
  • Saks: Buy physical gift cards, not e-gift cards.

Consider waiting for an even better triple dip

Discover’s fourth quarter 5% category is called “Holiday Shopping & More”. While we don’t yet know the full details, in the past almost all online shopping counted.  So, I expect that all of the above stores, and many more, will qualify for the 4th quarter 5% bonus.  More importantly, Discover has historically offered better than usual portal rates in the holiday months at the end of each year.  If they do that again, then Discover Deals will most likely offer 10% cash back for many of the stores shown above.

If both of my 4th quarter assumptions come true, it will be worth waiting to triple dip.  You might be able to earn 5% from your credit card and 20% from Discover Deals (since you’ll have earned 10% twice).  That’s a total of 25% cash back which will be doubled at the end of the year!

Here is, specifically, how it might work for Sears (if my 4th quarter assumptions come true):

  • Go through Discover Deals to Sears.com: 10% cash back
  • Buy gift cards and pay with your Discover card: 5% cash back (thanks to the 4th quarter bonus)
  • Go through Discover Deals to Sears.com: 10% cash back
  • Buy merchandise and pay with gift cards: If you’re a member of Sears’ Shop Your Way Rewards program you’ll earn at least 1% back in SYW points

In total, you’ll earn 25% cash back and at least 1% in SYW points.  And, thanks to the Double Cash Back promotion, that will be doubled to 50% cash back!

Conclusion

There are some great deals to be had by combining multiple offers: Discover’s 3rd quarter 5% bonus; Discover Deals portal; and Discover’s Double Cash Back promotion.  On the other hand, there’s a good chance that we can do even better in the fourth quarter.  If you have limited purchases to make within the allowed categories, consider rolling the dice and waiting.  Or, if you have lots of purchases to make, it might make sense to maximize this quarter’s promotions and the 4th quarter promotion as well.

About Greg The Frequent Miler

Greg is the owner, founder, and primary author of the Frequent Miler. He earns millions of points and miles each year, mostly without flying, and dedicates this blog to teaching others how to do the same.

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  1. […] Double dipping Discover’s 3rd quarter categories by Frequent Miler. Really great post for people looking to double and triple dip on Discover’s 3rd quarter categories. Personally I’m hoping the Amazon Prime Day sale has some good deals that I can pick up, I’ll be able to get 5% CB doubled to 10% and then whatever the portals are offering as well. […]

Comments

  1. Well your Sears comments are contradictory compared to your post from 2012 where you say buying physical gift cards from Sears earns portal cashback while buying e gift cards don’t earn portal cashback. Can you clarify? Thanks

  2. Are you sure that online, and not just in-store, purchases from department stores will get the 5% quarterly bonus?

      • But isn’t Discover capped at 1.5k per quarter? So by waiting for Q4, don’t you lose the 5% deal on Q3?

        I think you are confusing the Discover card with the Citi Dividend card, which doesn’t have the 1.5k per quarter limitation. In the case of Discover, you have to max. each quarter 1.5k, or you lose it.

  3. does anyone have any data points about making many large purchases thru discover deals? for example say I have a discover card with a $6k limit and make $5k of purchases on that card and then $30k or more thru the discover portal using that card plus gift cards and other cards in a month. had anyone had cash back post or not post in cases like this?

  4. If I used my card at Lowe’s, will I receive double cashback (2*5%) at Lowe’s. Is Lowe’s a home improvement store?

  5. I mean I will buy Shell giftcard at Lowe’s, but I dont know will I qualify 5% cash back or not?

  6. Isn’t this a lot of work to get 25% on the maximum $1500 spend ($375)? I have a Simon mall near my office and am able to email them to pick up my $500 gift cards which I put on my old blue AmEx that offers $5% ($25 minus the $3.95 fee). Why don’t more people talk about the old AmEx blue 5% cash back?

      • No you can’t. No card gives category bonuses on Simon mall GC purchased directly. Owen is either buying these through a grocery store or is BSing or is just ignorant.

  7. Does anyone have experience buying electronics on the Sears marketplace? I was about to double dip and get a surface pro 3 and make almost 10,000 aa miles but was too afraid because of the faceless ratingless vendors. Seems like anyone can call themselves a store on there.

    • At Christmas time, I tried to buy a GPS for my sister and I did it through Sears vendor. I waited 2 weeks for my Garmin. Never heard from the vendor. I called Sears and they said they are processing the order. I finally had to cancel the order and just go buy a GPS somewhere in person. YMMV.

  8. What about this scenario with Sears?

    – Go through Discover Deals to Sears and buy e-gift card with Discover card
    – Go through Discover Deals and buy 100% back in points SYWR items from Sears with e-gift card
    – Go back through Discover Deals and use SYWR points to buy what you actually want

    • People can still apply for new Discover It cards to get in on the Double Cash Back offer. Existing Discover It cards won’t get double cash back if they haven’t already been registered for the offer

  9. So I should be able to go through the Discover portal and buy $500 Visa gift cards at Home Depot (to help meet CC bonus spending requirements) to then be loaded on REDbird and get 10% cash back which later will be doubled since I got into the 12 month promotion in June? Pretty sweet deal… but does Home Depot charge shipping for gift cards?

      • Oh bummer… thanks for letting me know! So I guess I would only get the 5% cash back buying the Visa GCs in store… which would then later be doubled. Still a great option to meet minimum spend requirements I suppose.

  10. “Buy gift cards and pay with your Discover card: 5% cash back (thanks to the 4th quarter bonus)”

    Isn’t that 5% bonus category cashback also doubled? That’d make it 60% cashback in the end right?

    • Yes, the 5% also gets doubled. No, it doesn’t add up to 60%. The portal double dip adds up to 20% (pre-doubling) and the 4th quarter bonus = 5% (pre-doubling). All of the above add to 25%. Double to 50%

  11. did staples just pull out of discover deals? I know I bought something through the portal last week, but now it is gone

    • It does appear that Staples is not there anymore. However, I’ve seen the same thing happen with Sears a few times. Each time it has come back. Once it came back in a day or two. Another time it took a few weeks. Hopefully Staples will come back in soon!

  12. You probably also got the email from Discover today called “You’ll LOVE Discover Double CashBack Bonus”.

    Any concerns about the last FAQ:
    “Is Double Cash Back available to any cardmember?
    No. Double Cash Back is available to new cardmembers only.”

    • No, I’m not concerned about that. I think it just reflects the fact that they are no longer letting existing cardmembers sign up. Those that already signed up will be fine.

  13. Greg – Great post – as always!
    So once I’ve used my first $1,500 3Q bonus using Discover It Card for Sears eGC purchases (assuming Discover card registered for the double bonus) and hence 10+10+5 = 25% on the single dip, I’m assuming I can buy HIGC’s at CVS with my Amex OBC CC and use these HIGC’s to continue the 25% total cb bonanza on further Sears eGC’s right? (10% +10% for using HIGC’s at the Discover Mall portal, and 5% cb on the Amex OBC). Please advise.
    Then liquidate these Sears eGC’s at Sears to buy $200 VGC’s for BB loads at Wally’s, assuming the tellers at Sears don’t refuse (as is sometime the case.).

    Any other creative MS/ miles strategies at CVS these days since we lost Vanilla Reload purchases using CC? A blog on this topic would be great.

    • If you want to use gift cards to buy Visa gift cards at Sears, you won’t get 25%. Instead:
      * 5% for using Discover card at Sears
      * 10% for going through portal to buy or reload gift card
      The final 10% in my examples comes from using the gift card to buy Sears merchandise. Since you’re skipping that step, you won’t get it.

      Also: Sears seems to be much more strict lately about not allowing gift cards to buy gift cards so you may have some problems with that as well.

      CVS: This is one reason REDbird is better than Bluebird/Serve. Buy Vanilla One gift cards and use as debit cards at Target to reload REDbird.

      • I don’t think it is a bad idea, except that Discover may claw back all the cashback. Greg, it is possible to buy Sears GC at 5% off using your OBC and then use these to go through Discover deals and buy sears eGCs for an additional 10% off (which will become 20% after a year). Then, assuming you can find a cashier who will sell you VGC using Sears eGCs, you can convert them to VGCs.

  14. Anybody ever get their Discover portal cashback clawed back when buying Sears GC from Sears or redeeming Sears GC alongside coupons?

    I’ve noticed lately that Discover has been clawing back my cashback on some purchases where gift cards were redeemed.

    The claw back shows up as a lesser cashback amount on my statement than what was originally reported in the initial cashback confirmation email.

    • No, that hasn’t happened to me. However, if you purchased things on, I think, 5/22/15, from any portal, you would have had your points or cash back clawed back. Something weird happened for a day or two then.

  15. I wanted to see if my idea would work to gain an additional 20% back.

    -As you mention, use discover portal, with discover card to buy sears gift card on sears.com (5% CB for quarterly bonus, 10% CB for sears portal)
    -Use those sears gift cards through the discover portal for an additional 10% CB, but buy items that give you 100% back in Shop Your Way Points
    – Use those SYWP through discover portal a third time for an additional 10%.

    Altogether get 35% CB, doubled to 70% CB?

    Anyone know if this would work? Thanks for all the great posts!

  16. I followed what you described in the article for Sears / Discover Deals and easily see how to get the first 30% back. However, Discover Deals specifically states to “Pay with your Discover card at checkout” in order to get the 10% portal cashback. Based on that, I do not see how you get the last 20% when paying by gift card. Does Discover Deals pay the cashback bonus even when the Discover card is not used?

  17. I asked this on another post but this one seems to get more action…
    Ok… sorry in advance for the long post. My 21 year old water heater is finally dead and I was gonna buy a new one from Sears using my Discover IT card through the portal. With the possibility of up to 50% CB (I got in on the year end CB doubling as an existing customer in Jule) has me thinking about getting a hybrid electric model which I would never do otherwise. It is $700 more than a regular electric unit. But maxing the Sears CB and annual energy savings have me intrigued. So I would need to go through the portal and buy $1200 in GCs with my Discover card (the unit is $1140 but with tax will be over $1200) then go back through the portal and buy the heater with the GCs. Sounds easy enough! But people are having problems with Discover honoring the purchases using gift cards? So if they flag it then I would lose the second 10% through the portal (20% total after the year)? But still get all the original GC purchase CB?

    • Yes, that’s right. There is risk in the second dip as you pointed out. That said, I’ve done this countless times and haven’t had any trouble. You can reduce risk by going through a different portal the second time. Only bank portals say that they require use of specific credit cards for payment, so just about any other cash back or mileage portal should be safe.

  18. SUBJECT: DISCOVER IT.

    1. I am qualified for double cash back (D/CB).
    I bought $1,500 Sears GC thru Discover Deals.
    that offers 5% CB for 3rd quarter and 10% to purchase at Sears.
    * DCB for 12 months.
    I think it will get total 30% DCB.
    CORRECT?

    2. TRIPLE DIP:

    Now, I go back to Discover Deals again, then Sears, to purchase a TV for $1,500 and plan to pay by Sears gift card.
    A Discover’s Reps told me that I will GET NOTHING from Discover if I do not use Discover Card to pay.

    Instruction from Discover Deals requires that I have to use Discover Card to pay at check out.

    Your advices?

    • It sounds like its kind of a risk you would have to take. Technically discover requires you to use the discover card to get cashback via the portal, but oftentimes people have had luck even without using discover card, but if Discover ever went back to look at the purchase for whatever reason- they could take the cashback, back. from my understanding at least

  19. In fact I now appoach all deals like this, never count on a portal deal to make a deal, if it is not at least a small money maker with out the portal, it’s not worth the hassel

        • Sorry, you are correct. I must have missed that sentence somehow. Still, I think the “YMMV” caveat really should be emphasized more strongly, as from personal experience, Discover will find any reason to deny cash back whenever possible.

  20. Just for your info, I had it posted on other topics:

    Haven’t had a “Congratulations, your extra Cashback Bonus is on the way” email since Oct 9th.
    The statement that closed on Oct was supposed to get over $1000 (Adding up the cashback notification email in that statement period) in cashback but ended up being $35.xx. Looks like Discover changed their terms. My Sep statement cashback was over $1000 as well.

  21. I missed out on this, but aren’t you all spending more than you would normally spend anyway. If not with money, then on time. Why not just churn CC’s for the 100-200 cash back? That way you are only required to spend $4,000 / year on anything unlimited ($1,000 in 3 months is common). And it’s a guaranteed 10-20% back.

    A holiday gift costs $10-100. So even if you save, 50% on two most expensive gifts, you could have just churned 1 bad card deal.

    But maybe I’m just jealous.

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