The Citi Premier card is one of the more challenging cards in the points and miles world to evaluate. Its benefits are really good, but rarely if ever best-in-class. There are many, many nuances that go in to whether the Premier card is a keeper for any given person, but in our view, they ultimately boil down to this – if you’re active in the Citi ThankYou Points (TYPs) world, then the Premier card is pretty much a must-have card. For this reason, we kept our Premier cards. If not, then it’s not a keeper (though it may be worth getting a Premier card for its sign-up bonus).
If you don’t keep your Citi Premier card, though, you may want to seriously consider a product change to a no-fee Citi card such as Double Cash or Rewards+ rather than closing your card outright.
With respect to retention offers – We had very different results with our two Premier cards. On one card we got no offer at all. But on our other card, we received a nice retention offer that would have justified keeping the card even if we were otherwise planning to cancel.
Background of Our Citi Premier Cards
I hold 2 Citi Premier cards. We’re sure you’re wondering why, and the answer is part of a grand experiment with Citi cards and TYPs that we discussed in detail in this article:
- Middle Age Miles: Setting Up a ThankYou Points Experiment (May 12, 2020)
With that, let’s talk about my 2 Citi Premier cards:
Citi Premier #1 – We applied directly for this card and obtained it 2 years ago in June 2018. During its first year, we spent about $16,000 on the card. At the card’s first renewal, we received a modest retention offer of 5,000 TYPs for $1,000 in spend, and we kept the card. We wrote about our decision to keep this card in last year’s Premier “Keep or Cancel” article:
- Middle Age Miles: Keep or Cancel – Citi Premier – and Did I Get a Retention Offer? (August 6, 2019)
During our second cardholder year, we spent only about $1,300 on the card (most of which was spent to earn TYPs from the retention offer).
Citi Premier #2 – This card was originally a Citi AA Platinum card. We first obtained the AA Platinum card in March 2019. After our first year’s renewal, we converted this card to a Premier in May 2020. At that time, the annual fee for the AA Platinum card was refunded. The $95 annual fee for this Premier card then posted in mid-July 2020.
We met the minimum spend for the sign-up bonus for the AA Platinum card but spent nothing else on the card during the year we held it. In the 2 months between the time we converted to Premier and the date of our retention call, we spent about $4,100 on this Premier (almost all of which was grocery store spend earning 3x TYPs).
Basics of the Citi Premier Card
The Citi Premier is the mid-tier card in Citi’s family of TYP-earning cards, with the Prestige being the premium card bearing a hefty annual fee of $495. Basics of the Premier card and key benefits include:
- Annual fee: $95 (waived first year)
- Current sign-up bonus: 60,000 TYPs when you make $4,000 in purchases within 3 months of account opening
- Allows the cardholder to transfer TYPs to Citi’s airline partners (all transfers are at a 1:1 ratio, and sometimes Citi runs promotions for higher-value transfers) – airline partners are:
- Aeromexico Club Premier
- Avianca LifeMiles
- Cathay Pacific Asia Miles
- Emirates Skywards
- Etihad Guest
- EVA Air
- Flying Blue (Air France & KLM)
- JetBlue TrueBlue
- Malaysia Airlines Enrich
- Qantas Frequent Flyer
- Qatar Privilege Club
- Singapore Airlines KrisFlyer
- Thai Airways Royal Orchid Plus
- Turkish Airlines Miles & Smiles
- Virgin Atlantic Flying Club
- TYPs may be combined among TYP-earning cards, meaning that TYPs earned on another card such as Double Cash or Rewards+ can also be transferred to airline partners if you hold a Premier card
- Damage & Theft Protection (if damaged or stolen within 90 days of purchase or delivery)
- Extended Warranty coverage (extra 24 months)
- [Note that many other coverages, including all travel protections, were eliminated from the Premier card in September 2019]
- No foreign transaction fees
Other Premier card benefits are evolving dramatically over the next few months:
Benefits from now through April 9, 2021:
- Bonus categories:
- 3x TYPs on travel (very broadly defined), including gas stations (3.75% return, at our baseline value of 1.25 cents per TYP)
- 3x TYPs at restaurants
- 3x TYPs at supermarkets
- 2x TYPs on entertainment (2.5%)
- 1x TYP everywhere else (1.25%)
- Redeem for travel through the Citi ThankYou travel portal at 1.25 cents per TYP
New Added Benefit as of August 23, 2020:
On August 23, 2020, the Premier card adds a new benefit – an annual $100 hotel savings benefit. This benefit, though, has a number of strings attached:
- Requires a single hotel stay of $500 or more
- Must book through the ThankYou portal (either online or by calling)
- Note that this is a serious limiting factor, as (a) hotel rates on the ThankYou portal are often higher than what you can otherwise get through member rates, AAA or AARP rates, or other discounts; and (b) this would be a third-party booking, meaning that you won’t receive points or elite qualification credits, and you probably won’t get elite benefits either
- Can only be used once per calendar year
- Cannot be combined with the Citi Prestige 4th night free benefit
In light of all of these restrictions, we give this new benefit a value of zero.
Benefits as of April 10, 2021 and going forward from that date:
On April 10, 2021, several important and negative changes go into effect on the Premier card, as shown here:
The reduction in travel redemption value is particularly devastating, as all of our TYP redemptions in recent years have been for airfare through the Citi ThankYou travel portal, and those redemptions are being devalued by 20%. Fortunately, at least Citi gave us a year’s notice of these changes.
After these changes go into effect, from April 10, 2021 forward, bonus categories and Travel Portal redemptions will look like this:
- Bonus categories:
- 3x TYPs on air travel, hotels, travel agencies, and gas stations
- 3x TYPs at restaurants
- 3x TYPs at supermarkets
- 1x TYP on everything else
- Redeem for travel through the Citi ThankYou travel portal at only 1 cent per TYP
You can see more information about the Citi Premier card and its benefits at the dedicated Citi webpage here.
“Keep or Cancel” Analysis
As we mentioned in the Executive Summary to this article, we think the “keep or cancel” decision on the Premier card comes down to whether you believe it’s worthwhile for you to be engaged in the Citi ThankYou ecosystem as a whole. That’s a subject that requires a good bit of nuanced analysis. We have it on our “to do” list to write and publish an article on that subject sometime soon.
For those that are already engaged with Citi, we believe the Premier card is definitely a keeper. We say this even though the card is a bit of enigma – it’s really good in a lot of areas, but best-in-class in almost none.
In terms of ongoing points-earning, let’s look at each of the categories:
- 3x TYPs for Travel (3.75%) (being reduced to air travel, hotels and travel agencies only as of 4/10/21) – For all of these charges, we prefer the 3x Ultimate Rewards (UR) points-earning with the Chase Sapphire Reserve card (CSR). For us (and most people), UR points are more valuable than TYPs because of the ability to redeem UR points through the Chase Travel Portal or Pay Yourself Back at 1.5 cents per point (cpp) and the ability to transfer to Hyatt. At 1.5 cpp, travel on the CSR earns 4.5% points rebate. In addition, paying for airfare and car rentals with a CSR comes with insurance coverages.
- And beyond that, obviously there are other cards that can beat 3x TYPs/3.75% for various travel sub-categories – including Citi’s high-end Prestige card, which earns 5x TYPs (6.25%) for air travel, hotels and travel agencies.
- 3x TYPs at Gas Stations (3.75%) – In this category, the Premier may be best-in-class overall, yet we rarely use it. This is because most of the time, we have a promotion where we can do better. For example, right now there’s an Amex Offer for 10% back at ExxonMobil stations that’s available for the next several months. We have ExxonMobil stations in our area that are competitively priced, so we’d much rather use our Amex Blue Business Plus card for 2x Membership Rewards (MR) points + 10% back. There’s also an Amex Offer for +2x MR earning at QuikTrip (QT) stores that results in 4x MR total there (6.0%), which works well if you’re in the QT footprint. Gas is also often a bonus category for cards with quarterly 5x/5% rotating categories, such as the Chase Freedom. And on a promotional basis until 9/30/20, the CSR card earns 5x at gas stations up to a cap of $1,500.
- In addition, we have a long-since-discontinued legacy Chase Ink card that earns 3x UR points (4.5%) at gas stations that truly serves as our default go-to gas card – but that’s a very rare card these days so it’s inapplicable for most readers.
- All that said, if you do manufactured spend with gift cards, and you have a nearby gas station that allows you to purchase GCs with a credit card, the uncapped 3x TYP benefit could be very useful.
- 3x TYPs at Restaurants (3.75%) – Many cards offer restaurants as a bonus category, and many of them exceed the Premier’s points earning. For example, there’s the Citi Prestige (5x TYPs / 6.25%), Amex Gold personal card (4x MR / 6.0%), and the CSR (3x UR / 4.5%).
- 3x TYPs at Supermarkets (3.75%) – Some Amex cards, including Everyday Preferred (up to 4.5x MR / 6.75%) and the personal Gold card (4x MR / 6.0%) earn substantially more than the Premier. But these cards have annual caps, whereas the Premier’s supermarket category is uncapped. As we discussed earlier, those who do manufactured spend may find great value in this uncapped bonus category. We’re currently using our Premier card for grocery store gift card purchases at 3x, which is big factor for why we’re certainly keeping the card.
All this said, the Premier’s combination of useful bonus categories in a single card makes it a solid choice if you don’t have a wallet full of other cards to maximize each individual category.
And then, pairing the Premier with a no-fee Citi Double Cash card, which earns 2x TYPs everywhere (once you convert them from 2% cash back) makes things even better. Use the Premier for all of its bonus categories at 3x, and use a Double Cash for 2x everywhere else (at least in the US; the Double Cash has foreign transaction fees). Add in a no-fee Citi Rewards+ card to get a 10% rebate on TYP redemptions (up to an annual cap of 10,000 TYPs rebated) to juice the value of this combination even more.
Holding a Premier card allows you to pool TYPs earned on the Double Cash and Rewards+ cards (as well as other Citi TYP-earning cards) and then use them for travel portal redemptions and transfers to Citi’s airline partners. This feature gives you the ability to earn outsized value for purchases made with the Double Cash card, which would otherwise be a simple 2% cash back card. (The same can be said for the Prestige card, although the Prestige doesn’t allow 1.25-cent travel portal TYP redemptions.)
Looking more at the redemption side – We’ve long been able to redeem TYPs for 1.25 cents per point for travel through the Citi Travel Portal. We’d purchase airfare, earn miles and elite qualification credits for our flights, and be quite happy. When this benefit goes away (reduced to 1 cpp) on 4/10/21, it seriously hurts the value of holding a Premier card. From 4/10/21 onward, the only way to maximize value from TYPs will be through transfers to airline partners. We plan to cover this angle in more detail in a follow-up article.
Another factor in anyone’s “keep or cancel” decision for the Premier card relates to the sign-up bonus eligibility rules. You’re only eligible for a sign-up bonus on a Citi Prestige or Premier card (currently 50,000 TYPs and 60,000 TYPs, respectively) if you have not received a new cardmember bonus for a Prestige/Premier/Preferred/Rewards+ card and if you have not closed any of these cards, in the past 24 months. Because closing a card resets the 24-month clock, you may want to keep a Premier card open so that you remain (or can become) eligible for a new cardmember bonus. For us, this is definitely a factor in keeping our Premier cards. Our 24-month clock expires during August 2020, and we’re hoping to apply for a new Prestige or Premier card then.
We’d also note that if you’re thinking of closing a Premier card, you might consider a product change instead. It can be valuable to convert a Premier, particularly to Double Cash or Rewards+. Again, it’s a strategic, nuanced decision about which Citi card would be the best for a product change. Unfortunately, there are conflicting data points on when and whether a product change counts as an account closure for purposes of Citi’s 24-month sign-up bonus eligibility clock. Conventional wisdom is that it’s not a closure if the card number doesn’t change – but Citi also seems to be inconsistent about the circumstances in which a product conversion will result in a change in the card number. Clear as mud, right?
We’ll wrap up this section by saying again that evaluating the Premier card (and the Citi TYP ecosystem as a whole) is a complex, nuanced analysis. There are many points to consider, and some of them are moving targets with the negative changes that are taking effect on 4/10/21. Right now, the Premier is a keeper for us, for a number of factors. But our personal conclusion certainly isn’t a “one size fits all” answer.
Our Retention Calls
Even though we were planning to keep our Premier cards, we made 2 retention calls to Citi.
On the first call, I asked about a retention offer for Citi Prestige #1 (at that time, the annual fee for Prestige #2 hadn’t posted). Remember, this is the card that had only about $1,300 in spend during our cardmember year. Short answer – we were not offered any retention bonus for this card.
On the second call, I asked about a retention offer for Citi Prestige #2. Recall, this is the card we converted from AA Platinum a little more than 2 months earlier. As an AA Platinum card, we hadn’t put any spend on the card after we met the spend for the sign-up bonus. But in the 2+ months between the conversion to Premier and this retention call, we’d spent about $4,100 on the card.
The front-line agent transferred me to an account specialist after hearing the reason for our call. I told the account specialist that I was considering closing the card. It seemed like there were some magic words she wanted to hear, as she kept asking me to say that I “wanted to close the card” and that it was “because of the annual fee.” I never said that I wanted to close the card, to try to ensure that she didn’t simply close it. But after a couple of rounds of semantics, she informed me that there was indeed a retention offer available.
She offered a two-part retention bonus as follows:
- 500 bonus TYPs if we spend at least $500 on the card during a statement cycle, available for each of the next 16 months (that is, up to 8,000 total if we spend $500+ in each of the 16 cycles); plus
- a statement credit of $95 if we spend at least $95 on the card during each of the next 2 statement cycles (basically an offset of the $95 annual fee, and this is a single credit – not a credit for each of the statement cycles)
Citi often has more than one offer available on a card, so I asked her if there were any other offers. She said yes, and presented me with this alternative offer:
- 5,000 bonus TYPs if we spend a total of $1,000 within the next 3 months
The account specialist thought that the first offer was better, and we agree. The second offer is worth about $62.50 (5,000 TYPs * 1.25 cpp) and requires $1,000 in spend. By contrast, the statement credit part of the first offer alone is worth more ($95) and requires less spend (as little as $190). And, the first offer was even more valuable because of the 16-month earn-out where we could earn up to 8,000 TYPs that would have a baseline value of about $100.
I accepted the first offer, and the account specialist read the required disclosures. There was no requirement to keep the card open for any certain amount of time (other than what would be necessary to collect the bonus components).
In light of this success on Premier #2, I took the opportunity to ask whether there were also any retention offers available for our Premier #1 card. Unfortunately, there were still no retention offers on that card.
This was a long article, yet we feel like there were many more nuanced points that we could have covered to make it any longer. We hope that we’ve at least provided you with some framework to determine whether the Citi Premier card is a “keep” or a “cancel” (or a “convert”) for you. And if you have any questions related to your own situation, feel free to ask us in the Comments.
What do you think about the Citi Premier card and our keep-or-cancel analysis? What other factors should people consider in their own keep-or-cancel decisions? Please share with us and other Middle Age Miles readers in the Comments!
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