Citibank updates its credit card rewards programs from time to time and when it discontinues an old rewards program like the Citibank PremierPass rewards card, it moves those customers to one of its current Citibank rewards credit cards. One of the many cards that offer the company’s branded rewards program called Thank You Rewards, is the Citi ThankYou Premier card.
(Note: Citibank is the official name, although some people look for City Bank MasterCard or City Bank rewards when trying to find out more information.)
Is the Citibank Premier Card a good rewards card? Let’s take a look.
First, the Citi ThankYou Premier Card comes with a $125 annual fee PLUS ANOTHER $50 fee for each authorized user. That means a husband and wife credit card account with Citibank for this card will run an eye-popping $175 per year just for the annual fee. It’s waived for the first year, but otherwise, that is a pretty solid strike against any credit card offer unless it has a lot of benefits to back it up.
Don’t look for a great interest rate to offset that big annual fee. The terms and conditions list the rates as 13.99% , 17.99% , or 21.99% depending upon your credit score. Even worse, those are not fixed rates which means that when the Fed takes interest rates back to a measly 2 percent, the interest rates on this Citi credit card will be 15.99% , 19.99%, and 23.99% respectively.
Earning Citibank Rewards Points with Citi Premier Card
The Citi Premier rewards card works like most rewards credit cards do. You earn 1 ThankYou point for ever $1 you spend on the card. You earn 1.2 points when you use your card at grocery stores, gas stations, drugstores, parking, and “commuter transportation.”
That is pretty unremarkable. Where the Premier Card tries to make it up is that you also earn one point for each mile flown when you use this Citibank MasterCard to purchase your plane tickets. For frequent travelers, those additional ThankYou Flight Miles can add up pretty fast and make the $125 fee worth it.
There is an additional anniversary bonus for cardholders based on your “membership year.” You become a member when you get your card basically. The first year you earn a 1 percent anniversary bonus, then 2 percent for the second year, and so on until after 4 years, you get a 5 percent anniversary bonus on the number of points you earned during the year.
For most card holders, this is an insignificant bonus. Consider if you spent $25,000 during the year on the card plus you flew 20,000 miles, that adds up to 45,000 total ThankYou Point. The first year bonus is a measly 450 points. After five years, it becomes a little more meaningful. 5 percent of 45,000 points would be 2,250 points. You can’t get much with that, but it’s better than nothing.
The good news is that there are no caps on the number of points and miles you can earn, so if you fly a lot and buy all your tickets and hotels and rental cars on this particular rewards MasterCard, you can earn a lot of miles to use for free travel later.
If you are looking to value this rewards card, don’t bother including the anniversary bonus, it won’t make up any ground over the main program.
Of course, as we often point out here, to compare rewards cards properly you have to examine not only how you earn points, but how much those rewards points are when you go to redeem your miles for an actual reward.
Redeem Citi Rewards Points
You can redeem 8,000 points for a $50 cash reward, or 16,000 point s for a $100 cash back reward. That is about half-way in between a standard 1 percent cash back credit card and the offerings from the Capital One Rewards catalog. (See here for the update to the 2011 Capital One Rewards card program.)
A flight from Denver to Dallas on Southwest Airlines showed up on the rewards travel site for 29,300 points while the same flight on Southwest Airlines website was listed at $246.80 including all fees and charges. It looks like customers booking rewards travel can expect to see that 20 percent bonus (1.2 points per dollar) from groceries and gas eaten up by the more expensive ticket rate used to redeem points. Otherwise, the ballpark redemption rate of 1 percent is what you get from this card.
Is Citi Premier Card Worth It?
The Citibank rewards program associated with the Citi Premier MasterCard is not worth it for must credit card customers. Unless you are a road warrior, the high interest rates and sky-high annual fee don’t bring any benefits you can’t get on a much cheaper credit card.
Image courtesy of Citi Cards website and promotional materials.