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October 7, 2011: First year annual fee waived in this version of the Citi Premier card, but need $2,500 in spending within the first three months. This version is better than the card which Emily applied for below.
Emily and I apply for new credit cards every 3 to 4 months because credit card bonuses are the easiest way to earn miles & points and to have Big Travel with Small Money.
Emily applied for the Citi Thank You Premier credit card in August which earned her 50,000 Thank You Points after spending $2,000 within the first 3 months.
50,000 Thank You points got us $665 towards travel expenses since you can redeem 1 Thank You point for 1.33 cents worth of travel.
However, the $125 annual fee is NOT waived in the first year, so the net benefit by applying for this card is:
- $540 if you redeem Thank You points for travel ($665 worth of travel – $125 annual fee)
- $375 if you redeem Thank You points for gift cards ($500 worth of gift cards – $125 annual fee)
$540 won’t get you much international travel, but is great for tickets within the US or for hotel or rental cars. We’ve already redeemed our points for tickets to visit Emily’s mom in Michigan! It was great to not have to fuss around with award availability while booking these tickets.
However, we wouldn’t use this card as our everyday credit card, because the earning levels on dining and travel are lower than on other cards.
This is not a good card for international first and business class tickets since you would have to earn 300,752 Thank You Points to earn a $4,000 business class ticket to Europe (400,000 cents/1.33 cents per point) versus, say, 100,000 points on the American Airlines card.
You also can’t transfer Thank You points to other mile and points programs either.
In my opinion, the annual fee is not worth the benefits of the card after the first year. But this is a good card for the sign-on bonus.
1. 50,000 point sign-on bonus. The Citi Thank You Premier card has a 50,000 Thank You point sign up bonus after spending $2,000 within the first 3 months.
This is not the best sign up bonus (the Citi AAdvantage cards offer more), but is pretty good if you’re running out of credit cards to apply for or if you’re looking for domestic air tickets for cheap.
The sign on bonus is worth $500 if redeemed for gift cards or $665 if redeemed for travel (since you get 33% more value when redeeming Thank You points for travel)
2. Earning. You earn:
- 1 Thank You point for all purchases
- 1.2 Thank You points for purchases at supermarkets, gas stations, drugstores, and parking vendors.
You also earn 1 flight mile for every mile flown on a ticket purchased using this card. Flight miles are converted to Thank You points once you have earned an equivalent number of Thank You points.
For example, you buy a ticket from Chicago to New York (a distance of ~750 miles). You will earn 750 flight miles which will be converted to Thank You points once you spend another $750 and earn 750 Thank You points by using your card.
3. Redeeming. Redeeming Thank You points for travel was very easy. I logged on to the Thank You point portal and searched for flights using the online booking tool.
The flight availability matched what I saw in Kayak. You also get the option to pay for part of your travel using Thank You points and the balance in cash.
4. Foreign Transaction Fee. There is no foreign transaction fee for using this card outside the US.
5. Free Companion Ticket. If you book your travel through Spirit Incentives (the travel benefit provider), you could receive a domestic companion ticket for free.
I haven’t called to verify whether this is a real benefit, or if you would have to buy a higher priced ticket to qualify for the companion pass.
6. 15% Discount on Travel. You could get a 15% discount if you book your travel through Spirit Incentives (the travel benefit provider). I haven’t checked to see if this is a genuine discount compared to the cheapest travel available online, or if it is a 15% discount on a higher base price.
7. Annual Fee. The annual fee of $125 is NOT waived for the first year.
This is one of the higher annual fees, and is not worth paying for to keep the card after the first year – especially since the earning rate is low, and you can’t transfer Thank You points to other programs and can’t redeem for international business and first class tickets.
8. Annual Dividend. You get a percent bonus on the points earned from purchases only.
- 1st year – 1%
- 2nd year – 2%
- 3rd year – 3%
- 4th year – 4%
- 5th year and beyond = 5%
Bottom Line: This is a good credit card to consider for its 50,000 point sign-on bonus, in your next app-o-rama if you’re looking for domestic US travel.
However, I wouldn’t recommend keeping this credit card after the first year, because of the high annual fee.
What has your experience been with the Citi Thank You card?