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*Last updated April 20, 2015
Banks are going all out in order to attract customers to their high end reward credit cards. To compete in this field, a card has to offer competitive rewards, valuable benefits and reasonable fees.
The hot trend with these cards is the flexible rewards program. For example, American Express offers cardholders points in its Membership Rewards program, while Chase cardholders earn Ultimate Rewards points. With these programs, cardholders can redeem their reward points for merchandise, gift cards, and travel reservations, or transfer them to miles with airline partners.
For its part, Citi has created its ThankYou rewards program to compete with Chase and American Express. Let's take a look at the Citi ThankYou Premier card to see how it stacks up.
Citi ThankYou Premier Features
- Earn 3 ThankYou Points per $1 on travel expenses
- Earn 2 points per $1 on Dining and Entertainment purchases
- Receive 1 point per $1 on all other purchases
- New applicants can earn up to 50,000 bonus points
- No annual fee the first year, $95 after that
What I Like –Points!
Citi's ThankYou Premier Card has some nice features. First, new customers can earn 50,000 points after making $3,000 in purchases within the first three months of opening an account.
With points in hand, cardholders can redeem them for merchandise that is supplied by various retailers, or in the form of gift cards from some very popular merchants. For example, electronics can be shipped to your house or picked up at Best Buy stores. There are also options to redeem points for gift cards for merchants such as Macy's, United Artists Theaters, and Ruth Chris Steak Houses. Cardholders can even redeem their points for any of the millions of items for sale on Amazon.com. All of these options return about one cent per point in value, or slightly less.
Another interesting option is to redeem points for repayment of a home loan or a student loan. Even if your loans are not held by Citi, they will issue you a check to the institution you specify. Points are worth one cent each towards loan repayments.
ThankYou points can also be redeemed for travel reservations including airfare, car rentals, hotels, and activities. In the past, I've redeemed ThankYou points for activities like a submarine ride in Maui, a scenic train ride in Oregon, and an airport transfer in New York City. Points are worth 1.25 cents towards airfare, and just one cent each towards all other travel reservations.
When cardholders redeem points for airline tickets, those tickets will still earn miles and be eligible for upgrades. This is always an important consideration for those who have, or want, elite status in an airline frequent flier program. ThankYou Premier cardholders also have the option to transfer their ThankYou points to the Hilton HHonors program at a rate of 1:1.5.
The option to redeem points for airfare at 1.25 cents each, or transfer points to Hilton is unique to this card and the much more expensive ThankYou Prestige card. Furthermore, those who get the Premier card, and who have already earned ThankYou points with the other cards, such as the Citi ThankYou Preferred -20k Bonus Points Offer or the Citi Prestige Card, can use their existing points to purchase airfare at 1.25 cents per point, or transfer ThankYou points to Hilton. In effect, getting the ThankYou Premier card will increase the value of the points you might already have.
Finally, this card offers several travel insurance and purchase protection policies that befit a card with a $125 annual fee. Thankfully, this card is also equipped with an EMV smart chip and there are no foreign transaction fees added to purchases made outside of the United States.
What I don't like
There are some good values in the Citi ThankYou program, but it is not the equal of American Express Membership Rewards or Chase's Ultimate Rewards. Those other programs feature several different ways to transfer points to airline miles or hotel programs, while Citi only offers transfers to Hilton at this time.
Despite this shortcoming, the recently lowered annual fee -now just $95 after the first year- which is right in line with competitors that are offering a smaller sign-on bonus. For instance, the Chase Sapphire Preferred and the Amex EveryDay Preferred Card from American Express both have an annual fee of $95, and all three of these cards waive this charge for the cardholder's first year (as does the Citi ThankYou Premier).
The bottom line
Reward credit card enthusiasts who love to transfer their points to airline miles are not going to be satisfied with Citi ThankYou Premier for all of their travel needs. Nevertheless, ThankYou points come in handy when used for rental cars or certain travel activities. By offering double and triple rewards for many purchases, and plenty of reward possibilities, this card has earned its place in the market as a high-end rewards card.
*Editorial Note: This content is not provided by Citibank. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by Citibank.
*The content in this article is accurate at the publishing date, and may be subject to changes per the card issuer.
*This offer and/or promotion may have since changed, expired, or is no longer available.