Friday, June 02, 2006

CitiRewards: A Glorious Revolution

So for those of you who have been under a rock the last five years, you may have noticed that everyone loves using their credit cards now because they can get 'points' for the things they buy. This is obviously a gimmick set up by credit card companies who know that spending a few million a year in free gifts is much more likely to entice customers into using their credit cards to purchase items they can only afford on high-interest monthly payments. Thus, a responsible consumer looking for free points is a loss for them, but that loss is more than made up for by the droves of Americans willing to pay for that iPod over a period of 9 years.

Well, Citi Rewards is part of the larger Thank You Network, which is basically where all Citi customers can go to redeem their points. Citi is a lot like Bank One or any other company, and offers a ton of different services and like fifty different types of credit cards, all of which fit different spending. There are cards for people who only buy gas, for frequent flyers, for general purchases, and so on.

Citi also gives you points for having an account with Citibank, although it is only a nominal sum of points. 1 point is usually earned by spending 1 dollar, and 5,000 points usually gets you 50 bucks in rewards (so about a 1% return). Doesn't sound like a lot, but if you know how to make your way through the system, you can find great deals.

I first got a Citibank account a few years back and then decided I wanted a points card so that I could put all of my monthly bills on my card and earn points for doing nothing out of the ordinary. I chose the Citi PremierPass Card, which has no annual fee and gives you basically one point for every dollar you spend. More importantly, it gives you 1 point for every 3 miles you travel on ANY airline. Granted other airline-specific cards give you better deals on miles, but those cards tie you to one airline and often their awards are redeemable only as other flights. On the other hand, Citi lets you redeem your points for gift certificates and a lot of other rewards.

The best part was that I got 15,000 points just for signing up, which is a $150.00 value right there. I've probably amassed another 60,000 points since and have cashed all of them in for either Best Buy gift certificates or gas cards. I make note here that people often make the wrong decision when cashing in rewards and buy an iPod or some other electronic device directly from the rewards site. Those kinds of items are terribly overpriced, so you're always better off getting a certificate at a retail outlet and buying it yourself at the store so you can get better deals and more choices.

The other great feature about the PremierPass is that you can get points for flights you purchase for anybody. For example, I bought my parents roundtrips from New York recently. I got about 650 points just for paying for the ticket. A flight from NY to CA is about 2600 miles or so, so that's about 10400 miles flown, of which I will get 1/3 back in points. So I'm getting roughly 3500 points + 650 points just for putting the flight on my card.

So about a few weeks ago, Citi ran a promotion for their Diamond Preferred Card, which offers another type of gimmick in terms of how they calculate points. The card has no annual fee, so there's no risk on my part, and they offer you 10,000 points for signing up. Granted you need to just make one purchase on the card -- in my case $6.90 in gas -- in order to be awarded the points. So I just got another $100.00 for using a card once, and then I can just leave it in my drawer and not use it again.

Citi recently ran another promotion, where you can tell your friends and family about the Citi PremierPass card. If someone signs up because of me, I get 5,000 points for each person. I signed up three people and got another $150.00 for nothing.

And last week, I looked on the site and they were running a promotion for the Citi PremierPass Elite, which is similar to the PremierPass. I warn you that the card does have an annual fee of $75.00, but they give you 15,000 points just to sign up, which is a $150.00 value. Also, this card gives you 1 point for every 1 mile flown on ANY airline.

I plan on using this card for an upcoming trip to NY, possibly for the July 4th weekend. But there is an interesting wrinkle. I usually fly JetBlue, and I have, through their rewards program, earned a free round trip to anywhere in the country. Of course, nothing is totally "free," so you still have to pay a small fee for federal taxes and an airport security charge, which is nominal. But the best part is that I can pay that sum with my credit card, and Citibank will still reward me for all of my flight points even though JetBlue is giving me the flight for free. Thus, I'll get about 5,000 points for taking a free trip to NY.

I think if you are a person that flies even once or twice a year, flights are what makes this card much better than standard cards like Discover that give you a flat percentage as cash back. While people will say that the reward from Citi is only a measly 1%, they are overlooking the fact that flights give you far more points than just 1 point per dollar spent. That's where you can really make this lucrative.

One other thing I have noticed. I booked a flight for my mom on Jetblue last summer and I had to cancel the flight at the last minute. Jetblue charged like $30.00 to cancel the flight, which is a standard fee. However, Citi still processed the charge as a flight and awarded me points for the flight. My guess is that they still do this.

Damn I'm good.

By the way, Citi lets you merge all of your Citi accounts into one Thank You account, which means all of your points, no matter what account they originate from, all get funneled into the same pot. This is invaluable because otherwise you might be stuck choosing measly gifts for each account.

Get yourself in gear, people. If you know you are responsible with your credit, then why give up a chance to get at least a hundred dollars for nothing at all?

For more information about enrollment and available cards, visit

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