Be Careful: If You’re New to Citi ThankYou Points, Choose Your First Card Wisely!

  • Jasmin Baron

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    There’s been excitement over the newest Citi ThankYou points earning card, the Citi Rewards+® Card.  While it doesn’t have the most compelling welcome bonus, it’s generated some buzz over a couple of novel perks it offers.

    Specifically, the Citi Rewards+ rounds up the Citi ThankYou points you’ll earn on each purchase to the nearest 10 points.  So if you buy a $1 pack of gum, you’ll earn 10 ThankYou points.  Or if you spend $11 on lunch, you’ll earn 20 points.  And you’ll also earn a 10% rebate on the first 100,000 points you redeem each year.

    It’s an interesting angle.  But for most, this card is NOT the best pick if you’re starting to collect Citi ThankYou points.  You’ll almost always get more value from the Citi Premier Card, and you’ll have much more flexibility in how you redeem your points.

    I’ll share why the Citi Rewards+ is no match for the Citi Premier!

    To Earn the Most Flexible Citi ThankYou Points, Look to the Citi Premier

    Apply Here:   Citi Rewards+® Card

    Read our review of the Citi Rewards+ Card

    Apply Here:   Citi Premier℠ Card

    Read our review of the Citi Premier Card

    Most of us on the MMS team have at least one card that earns Citi ThankYou points.  They’re a terrific complement to other flexible points earning programs like Chase Ultimate Rewards and AMEX Membership Rewards if you’re looking to travel for next to free.  I’ve got both the Citi Premier and Citi Prestige (open to new applicants later this month) in my wallet, and have had both for years.

    If you’re new to Citi ThankYou points and deciding between the Citi Rewards+ and Citi Premier, it’s important to choose wisely.  That’s because you’re not eligible for the bonus on a Citi ThankYou points earning card if you’ve earned a new cardmember bonus or closed ANY Citi ThankYou card in the past 24 months.

    Note:  Both of these cards will appear on your personal credit report and possibly affect your ability to get valuable Chase credit cards, due to the 5/24 rule.  If you’re just starting in our hobby, we recommend you begin with Chase cards, then move on to other cards from issuers like Citi and AMEX once you have the Chase cards you want.

    Here’s a comparison of both cards – and why the Citi Premier is better in just about every respect!

    1.   Welcome Bonus – Winner:  Citi Premier

    The Citi Premier is the clear winner here.  You’ll earn 50,000 Citi ThankYou points after spending $4,000 on purchases within the first 3 months of account opening.  That’s worth $625 in travel when you redeem your points through the Citi ThankYou travel portal (where your points are worth 1.25 cents each towards flight, hotel, rental cars, and cruises), and potentially much more when you transfer your points to airline partners like Singapore Airlines or Flying Blue.

    To compare, the Citi Rewards+ comes with 20,000 bonus points after you spend $1,500 in purchases with your card within 3 months of account opening; redeemable for $200 in gift cards at thankyou.com.  Mind you, you’ll get 10% of your points back on the first 100,000 points you redeem each year, so if you factor that in the bonus is worth an additional $20 (20,000 X 10% X 1 cent per point).

    And if you only have the Citi Rewards+, you can NOT transfer your points to airline partners, except JetBlue.  You’ll need a Citi Premier or Citi Prestige in your pocket to do that.

    The Citi Premier Allows You to Transfer Citi ThankYou Points to Partners Like Singapore Airlines.  The Citi Rewards+ Does NOT (Except for JetBlue)

    Earning $625 or more in travel from the Citi Premier is an excellent deal.  The welcome bonus on the Citi Rewards+ just doesn’t compare.

    2.   Annual Fee – Winner:  Tie (for the First Year), Otherwise Citi Rewards+

    As a long term card, the Citi Rewards+ has an advantage because it has no annual fee.

    But the $95 annual fee on the Citi Premier is waived for the first 12 months.  So it’s free to get and keep for a year to see if you like it.

    After the first year, you’ll have to assess whether or not the perks and bonus categories are a good fit for your spending habits.  I’ve kept the Citi Premier for several years because the bonus categories and purchase protections have made it worth my while.  And I’ve even gotten retention offers that have more than offset the annual fee.

    3.   Bonus Categories – Winner:  Citi Premier

    Here’s another area where the Citi Premier is a clear winner.  You’ll earn:

    Those are incredibly broad bonus categories, and there are no spending caps.  And earning 3X points on travel (including gas) is an easy way to rack up a substantial points balance, especially if you drive a lot.  The Citi Premier is usually my go-to card for gas station purchases, except for when the Chase Freedom has gas stations as a quarterly rotating 5X category (up to $1,500 each quarter).

    To compare, the Citi Rewards+ earns:

    So with the Citi Rewards+, the 2X category is capped (although it also includes gas stations).  And you won’t earn anything extra for travel or entertainment, which can be huge expenses for folks in our hobby.

    Here’s the big variable though – the Citi Rewards+ will round up the Citi ThankYou points you’ll earn on each purchase to the nearest 10 points.  This can be significant if you make a lot of small purchases, because, for example, in non-bonus categories, a $1 purchase will earn you 10 points, an $11 purchase will earn you 20 points, and so on.

    Small Purchases Like a Coffee or Snack Can Boost Your Points Balance, Because the Citi Rewards Will Always Round up to the Nearest 10 Points

    I see the rounding up deal as more of a novelty.  Unless you’re making vast numbers of relatively small purchases (and the terms on the Citi Rewards+ are clear that they won’t tolerate any abuse of this perk), the broader bonus categories and no spending caps with the Citi Premier will likely serve you better.

    However, the Citi Rewards+ also offers a 10% rebate on the first 100,000 points you redeem per year (so a maximum of 10,000 points per year).  So consider how many points you’ll likely earn (and redeem) in a year and factor that into your decision making.

    You could effectively consider this as earning 1.1 points per $1 in non-bonus categories, and 2.2 points per $1 at gas stations and supermarkets (on up to $6,000 a year, then 1X) for the first 100,000 points you’ll earn in a year – IF you redeem them.  If they’re just sitting in your account you won’t get a rebate.

    4.   Flexibility and Value – Winner:  Citi Premier

    Hands down, the Citi Premier earns Citi ThankYou points that are much more flexible and valuable than points earned from the Citi Rewards+ on their own.

    Here’s a look at what your Citi ThankYou points are worth when you have the Citi Premier:

    If Travel Is Your Goal, Citi ThankYou Points From the Citi Premier Are Much More Valuable

    If you only have the Citi Rewards+, you can redeem Citi ThankYou points at these rates:

    Keep in mind, if you have the Citi Premier and/or Citi Prestige, you can combine points from your Citi Rewards+ card to one of those accounts, then transfer them to airline partners.  Otherwise, you’re much more limited in how you can redeem your points.

    5.   Travel and Purchase Protection – Winner:  Citi Premier

    The Citi Premier comes with a ton of purchase and travel protections, including:

    It’s a far better choice if you’re booking travel or are making an expensive purchase where an extended warranty would be beneficial.  And in the event of a trip delay or interruption/cancellation, using the Citi Premier can save you lots of money and give you peace of mind.

    You can read more about the extensive benefits in our review of the Citi Premier.

    Flight Delayed or Cancelled?  If You Paid With Your Citi Premier, You Could Be Covered for Expenses

    While this is typical for a no-annual-fee card, the Citi Rewards+ doesn’t come with protections like extended warranty or travel coverage.  But you will be eligible for Citi Price Rewind when you use your card to pay for a purchase.  It’s always nice to get a rebate when the price drops on an item you’ve recently bought!  Here’s more about cards with purchase protection.

    What If You’ve Already Got the Citi Premier?

    If you’ve been at this hobby for a while, you might already have the Citi Premier open.  If that’s the case (and it’s been more than 24 months since you’ve earn the welcome bonus it, or closed any other Citi ThankYou card), you’re eligible for the Citi Rewards+.

    But just because you can, doesn’t mean you should.  Remember, opening the Citi Rewards+ will:

    Folks with both the Citi Premier and Citi Prestige (if they’ve been open for more than 24 months) might consider the Citi Rewards+ to boost their points balance, especially if they’ve been in the hobby a long time and don’t have a lot of other cards they can apply for.

    Here’s where the Citi Rewards+ could be also a good option – if you have the Citi Premier and are thinking of closing it because the annual fee is coming due, you should be able to product change it to the Citi Rewards+ rather than cancel.  But you won’t earn the welcome bonus.

    Bottom Line

    Folks who are new to Citi ThankYou points should be very careful in the card they choose.  While the Citi Rewards+ has some novel perks like rounding up earnings on each purchase to the nearest 10 points and a 10% rebate on the first 100,000 points redeemed each year, the card is still no match for the Citi Premier.

    The Citi Premier offers:

    Admittedly, the Citi Rewards+ has a slight edge in one respect:  It has no annual fee.  But the Citi Premier annual fee is waived for the first 12 months, so it’s free to use for a year to see if you like it.  And many of us (myself included) keep the Citi Premier year after year even with the annual fee because the benefits and points earning potential are well worth it.

    As always, if you’re new to miles and points, start with Chase cards first.  Because once you’ve opened 5 or more credit cards in the past 24 months (except certain business cards), you won’t be approved for Chase cards.  Here’s more about Chase card strategy for beginners.

    Editorial Note: We're the Million Mile Secrets team. And we're proud of our content, opinions and analysis, and of our reader's comments. These haven’t been reviewed, approved or endorsed by any of the airlines, hotels, or credit card issuers which we often write about. And that’s just how we like it! :)
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