Recently, several of my readers have inquired about Citi Prestige and whether or not it’s worth getting. The biggest concern, of course, is the annual fee of $450, not waived. I think it’s absolutely reasonable to question value of any card that comes with such a steep fee.
First, here are the specifics of this offer:
- $250 Air Travel Credit each year
- Complimentary 4th Night for any hotel stay
- Earn 50,000 bonus points after $3,000 in purchases made with your card in the first 3 months the account is open.
- Points are redeemable for an $800 flight on American Airlines, a $665 flight on any other airline or $500 in gift cards.
- Transfer points to a variety of travel loyalty programs from airlines to hotels.
- Earn 3x points on Air Travel and Hotels
- Earn 2x points on Dining at Restaurants and Entertainment
- 1 ThankYou® Point per $1 spent on other purchases
- Annual fee of $450, not waived.
This card is in affiliate networks, and does pay me and other bloggers commission. So, of course, as it goes with any paying offer, there is a huge incentive to dress it up and package it in the most attractive manner possible. This isn’t me being cynical, it’s how selling works. That being said, I think it is a terrific offer.
It’s only logical that when you sell/recommend something, your advice has more credibility if you yourself have bought it, right? Well, both my husband and I got this offer last year, and I have no regrets. We are very much your Average Joes, making average wage and taking only a few trips per year.
Sure, we had to prepay $900 in annual fees, but what we got in exchange was extremely valuable. After all, it allowed us to bring my parents over to US. So, if you are thinking about Citi Prestige, here are a few points to consider:
1) The annual fee will be covered via airline reimbursement credit.
You get $250 per calendar year and it can be used for revenue flights and even airline gift cards. It’s not a loophole or trick, no lying necessary. Here are the terms: “Airline Fees are defined as purchases made with airlines including Air fares, baggage fees, lounge access and some in-flight purchases.” As you can see, gift cards or airline tickets are not excluded.
And indeed, when you try to purchase them with your Citi Prestige, the credit posts without an issue. You can read about my experiment buying Southwest gift cards You can sell them or use them to pay taxes on tickets, the choice is yours. Either way, your annual fee should be covered…eventually.
2) While the card has several fancy benefits, the sign-up bonus is worth it even if you don’t take advantage of any of them.
I’m referring to “4th night free” perk, lounge access, evacuation insurance and golf benefit. Those are indeed nice, but I only took advantage of the lounge entry once. It was OK, but not a big deal. It definitely had no bearing on my decision to get the card. The main reason? The points, of course.
3) Those 50,000 points can be transferred to several mileage programs, redeemed for revenue flights or gift cards.
In other words, you are getting real flexible points, similar to Ultimate Rewards or Membership Rewards. While I don’t consider Citi quite as valuable as the last two programs, it’s pretty close. If you are an American Airlines flyer, you should definitely look into this card. That’s because 50,000 points are worth $800 in flights on American Airlines and its codeshares.
Basically, as long as the flight is marketed by AA, you should get 1.6 cents per point toward your ticket. American has an extensive network and multiple codeshare partners, so it shouldn’t be too hard to snag a decent deal. If you can find a good price on American, chances are, this option will beat using miles.
Let’s say there is a cheap fare on American Airlines from Miami to Brazil and it costs only $400 to buy your ticket (happens quite often). Your bonus from just one Citi Prestige card will cover two roundtrip economy tickets plus taxes, and you will even earn miles on your flights. No need to worry about award availability. Don’t have enough points to cover the whole ticket? No problem, you can co-pay with cash. See my post Credit Card Bonuses for American Lovers for more on this subject.
Tickets are super expensive and you have some flexibility? If you are looking to fly on United or Delta to Hawaii/Alaska, you can transfer points to several programs to help you maximize value on your award redemption. And the list goes on.
4) Even if you don’t plan on redeeming points for a flight on American or its codeshares, the value proposition is still very strong.
I’ve actually redeemed my points for flights on Lufthansa in order to bring my parents for a visit to US, and have no regrets. I was able to get 1.33 cents per point on tickets I would have purchased with cash. So, by that logic, the bonus was worth $665. Read my post for more details.
5) Even if you are not interested in flights, you can still get $500 in value via gift card redemption.
Unfortunately, I don’t think Citi has Walmart as an option anymore, but there are many decent choices on restaurants, stores etc. I don’t believe an average family will have a hard time finding something to their liking.
6) If you happen to have Citi Thank You Premier card, you can transfer points from Citi Prestige and get 1.25 cents toward travel.
I don’t believe there is a working application for a 40,000 points sign-up bonus on Citi Thank You Premier card at this time. It appears all links are dead, but comment and let me know if you find one. Anyway, if you have already signed up for Premier and plan to redeem your points toward cruises, car rental or hotel, Citi Prestige bonus can beef up your available balance.
7) There is a decent possibility that this offer won’t be as good in a near future.
I have zero knowledge and Citi wouldn’t tell me anyway, but there are a few indicators that the offer may change at some point. The owner of Outandout blog has written about his survey from Citi and some questions indicate that the bank is aware that this product is a little too generous.
I seriously doubt that the changes will happen within weeks or even months, but it’s something to keep in mind.
8) If you are willing to wait, signing up towards the end of the year will give you the best bang for your buck.
Well, if you plan on cancelling and getting a prorated annual fee refund. That way, you can get $250 airline credit in November or December of 2016, and then another $250 in January of 2017. Of course, there is no guarantee that this offer will stay the same or that Citi will give you the refund. YMMV
9) If you live near a Citi branch, go there and see if you can get this offer with $350 annual fee instead of $450.
I don’t live near one, but I would for sure check if I did. Reportedly, some have even been able to get 60,000 points. In general, it never hurts to walk by a branch to see what’s cooking. And no, I don’t get paid commission if you do!
10) If you are just starting out in the miles and points hobby, there are other offers you may want to consider first.
If you can handle $4,000 minimum spending in three months, I would probably start with Chase Sapphire Preferred. The annual fee is waived, and points are extremely valuable since they transfer to Southwest 1:1. Also, right now, it comes with 55,000 points bonus when you add an authorized user. As a new recruit, you don’t yet have to worry about 5/24 rule. Read about the card here
While the annual fee is a concern, if you can afford it, Citi Prestige is worth considering even for an Average Joe. Of course, it will take some organization to make sure you take advantage of the airline credit and maximize points value, but the deal is definitely lucrative. In short, I don’t believe this card is overhyped. But then again, it’s not like I’m completely unbiased.
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Leana is the owner and founder of Miles For Family. She enjoys beach vacations and visiting her family in Europe. Originally from Belarus, Leana resides in central Florida with her husband and two children.