I receive compensation for content and many links on this blog. Citibank is an advertising partner of this site, as is American Express, Chase, Barclays and Capital One. Any opinions expressed in this post are my own, and have not been reviewed, approved, or endorsed by my advertising partners. I do not write about all credit cards that are available -- instead focusing on miles, points, and cash back (and currencies that can be converted into the same). Terms apply to the offers and benefits listed on this page.
Reader Michael asked about how much value you can get out of the Citi Prestige card in the first year.
I’ll walk through Citi Prestige benefts, and the actual amount will depend on which you’ll take advantage of, but if you sign up for the Citi Prestige card you can pretty easily pocket $2000 in value from those Citi Prestige benefits — and for many even $3000 worth of value — during your first year, all for a $450 annual fee.
$250 Airline Credit… x2
There’s a $250 airline credit, that can be used directly on airline tickets and doesn’t have to be used purely for ancillary fees. It’s a calendar year benefit. So if you apply for the card now, you get $250 in 2015 and then another $250 to use at the beginning of 2016. That’s true whether you keep the card forever, or keep it just 11 months. So in your first cardmember year, that’s $500.
50,000 Bonus Miles
The signup bonus on the card is 50,000 bonus points after $3,000 in spend within 3 months of account opening.
That’s worth $500 in gift cards. Or it’s worth 1.33 cents apiece towards paid travel ($665). Or it’s worth 1.6 cents apiece towards paid travel on American ($800).
You can also transfer these points to airline frequent fly programs including Air France-KLM, Cathay Pacific’s Asia Miles, Etihad Guest, Singapore Airlines KrisFlyer, and several more.
Roughly speaking I think that these mileage transfers are worth about the same (1.6 cents apiece) as American Airlines paid travel redemptions. So the bonus is worth ~ $800
Lounge Access
The card comes with American Airlines lounge access when flying American (or US Airways). A member runs as much as $500 in a year. This card doesn’t come with a true membership, though, in that you need to be flying American for access (a membership gets you access when not flying the airline among other benefits).
The card also comes with Priority Pass Select membership for lounge access, offering unlimited visits to participating lounges and even including unlimited access for two guests each time. Priority Pass Select and Priority Pass are, for all intents and purposes, the same (Priority Pass Select was built to exclude United Clubs, since credit cards not issued by Chase can’t provide United club lounge access… but United Clubs have pulled out of the arrangement). Now that the two are the same, we can look to the price that Priority Pass sells memberships. An unlimited visit membership without included guests is $399. This card gets you free guests.
Most people won’t buy an unlimited Priority Pass and American lounge access, and how much it’s worth to you depends on how much you value lounge access and how often you’ll use it. But the market value of the benefit is surely north of $750.
Global Entry Fee Reimbursement
If you don’t already have Global Entry, the card will reimburse your $100 fee. The Global Entry submission doesn’t even need to be for you, just charged to the card. That’s a $100 value.
Free Rounds of Golf
You get three free rounds of golf per year. It’s a calendar year benefit, which means you can use it 3 times this calendar year and three times at the beginning of next calendar year — all for that same first year annual fee.
You can book one tee time at a time, and you must book at least three days in advance. (Different rules apply in Asia.)
Six golf games in your first cardmember year, many courses charge as much as $200 per round, this could be worth up to $1200.
Of course if you don’t play much golf (I don’t) you won’t value the benefit so highly. Indeed they can offer it precisely because not everyone will take advantage of it (breakage).
Here’s full information on the benefit.
4th Night Free Booking Hotels
You book through the Citi Prestige Concierge, stays earn full points and stay credit, and then you pay at checkout with your Citi Prestige card. You then receive a statement credit for the 4th night of the stay.
This is fantastic for stays where the rate goes up on the 4th night of a stay.
And this is fantastic where you’re going to stay 3 nights at the best flexible rate anyway, just tack on a 4th night and earn additional stay or night credit towards status and promotions and additional points without coming out of pocket any additional money. It’s the perfect mattress run.
You can use this even at luxury properties, you can get huge savings if you book the kinds of rooms that are $400, $800, or what have you per night.
There’s no limit to the number of times you can use this benefit each year (other than the calendar, 365 divided by 4).
Oh, and It’s a Strong Earning Card Too
Earning is triple points on air and hotels, and double points on restaurants and entertainment.
Unquestionably for travelers, and miles and points aficionados, the card offers really superior value. We can debate the exact amount of value any one person will get. But it’s hard to envision too many scenarios where one won’t get orders of magnitude more than the fee out of this card during that first year.
It would be nice if this card offered a discount if you already were paying for Admiral’s Club (or had lifetime status).
@freakflyer – lifetime status doesn’t get you Admirals Club membership (though 2MM lifetime Platinum gets you lounge access when flying internationally).
Maybe freakflyer is referring to Lifetime membership at the Admiral’s Club. I have this, and it cuts the value of a few cards that offer lounge access.
I have a few Citi branded cards and will be looking to close a couple in order to apply for this card (and hopefully auto approval). How long would you say after closing the cards that Citi’s auto approve system recognizes that their total exposure to me isn’t as high?
Gary –
One thing that I think is missing from all of the TYP valuations (yours and what I see elsewhere) is the fact that when you redeem for paid flights, you also earn miles on that flying. Obviously this will vary based on your status with AA and what fares you buy but I’ll provide an example.
Make your initial spend and collect 56,000 TYP (assuming some spend in bonus categories). You can then redeem those TYP for $896 in AA flights. Take yesterdays flights to GRU for example, you could have booked two of those for your 56,000 TYP. As an EXP, you will earn 48,000 AA RDM (assuming you are EXP and your flights were 12,000 miles roundtrip). If you have a similar valuation for TYP and AA miles, you have just “purchased” 24,000 EQM on American and only come out on the other end down 8,000 miles. Again valuing those miles @ 1.6, you just “purchased” 24,000 EQM (ignoring any other value that you may have gained from, you know, actually travelling) for $128.
For this reason alone I value TYP much higher than the ‘fixed’ value of 1.6 cents.
@Ben I don’t think that’s right, though. The points are used as 1.6 cents towards airfare. Cash isn’t worth more than cash just because it earns miles. It’s a direct cash replacement at 1.6 cents, therefore that’s the most it can be worth for paid airfare (on AA/US).
@Alvin DTW I can’t speak to the total credit you’re being extended, your income, and what Citi will see as a risk…. not enough data for that.
@Ben – unless I’m misunderstanding, this argument makes no sense, since you could have derived the same benefits by purchasing the tickets with $896 cash (valuing TYP at 1.6 cents each). Perhaps it’s a good deal, but that doesn’t make the TYP worth more than 1.6 cents each…
“Maybe freakflyer is referring to Lifetime membership at the Admiral’s Club. I have this, and it cuts the value of a few cards that offer lounge access.”
Exactly. And it may be that corporations will pay for club membership separately but travelers would like to have this card for the personal benefits.
And if TYP are worth $.016 each, I would rather earn 2% straight cash back as is available on other cards.
Gary/Dave –
You may be right and it will obviously vary from individual to individual. But the way I see it in my example is that I just transferred 48,000 TYP to 48,000 AA miles and bought 24,000 EQM for 8,000 TYP. Using the ‘set’ value of $0.016 per TYP, I just bought 24,000 EQM for $128 which is clearly understating the value of TYP.
you calc $800 + $500 for the sign up bonus + the airline credit but this says $1,350.
http://therewardboss.com/2015/04/09/get-1350-aa-credit-from-citi-prestige-50000-sign-up-bonus/
Redeeming Thank You Points for air travel comes with its disadvantages. You are limited to nine (9) segments. The fare price is usually higher than what is seen online, even when it’s the carrier. First-hand reports show that business and first class tickets are priced much higher than the airline or OTA. Multi-city doesn’t work with complicated itineraries. What’s the definition of a complicated itinerary? I don’t know, but you’ll need to speak with a Thank You travel agent to book if you’re unable to online.
Data point/venting:
Yesterday I called Citi and spoke with a Thank You travel agent with the hopes of booking air travel during the lunch hour. Correction: throughout the day, I spoke with four travel agents for a total of 4 hours, mostly on hold.
The first agent was professional and put together the 13-segment itinerary. After an hour of building it and trying other options such as forcing booking codes and switching flight destinations, he was surprised when it wouldn’t let him purchase the ticket. His supervisor said that only 9 segments are allowed. Would have been nice to know an hour beforehand. Back to the drawing board. After a quick look around Google flights and going to AA’s website, I found a 9-segment itinerary — same price though 6,000 miles less, therefore a higher cpm.
The second agent, after building the itinerary, which took 15 minutes, put me on a “brief hold”, which lasted 20 minutes, and then accidentally disconnected the call when she came back. If there is a way for the agent to call back, I never received one.
The third agent priced the itinerary at $400 more and tried to convince me to book, saying, “Using your Thank You Points still gives you a good deal.” No, thank you; I’d rather not pay $400 more than what I know is possible. He referred me to speak with the Thank You Points concierge to see if I could pay for the ticket and then have Citi retroactively take the points away.
The concierge was anything but helpful, nice or understanding, saying all that I could do is transfer points into statement credit. For example, 50,000 points would transfer to $250. No, thank you. She couldn’t do anything for me and in a rude way said the Thank You travel agent should have never referred me to their desk.
As an aside, I visited the local Chipotle and received a free meal due to being a frequent customer. Some brands know how to do it right, while others are learning. It seems Citi refuses to learn.
Later in the evening, after an hour and a half of being repeatedly put on hold and slowly repeating the desired 9 segment itinerary multiple times — albeit $134 more than what was on AA’s website — the fourth and final agent booked the itinerary with the help of her supervisor.
Thank you, finally.
@phil i think it is a mistake to include the points earned from minimum spend in the calculation, so i would disagree with that link. you would earn points for the same spend on another card too.
@Ben you had to fly American to earn American miles so the cost needs to factor your time, too. In any case you could have bought the paid ticket at the same 1.6 cent price.
@freakflyer the calculation here is about the value of the perks and bonuses, not about ongoing earn from unbonused spend. But for sure, if you have a lifetime Admirals Club membership then you would value getting Admirals Club access at zero.
Ben’s comment makes sense to me. Why wouldn’t you include the value of miles you accrue when you use TYPs? As a thought experiment: take the value of what you have at two points in time and compare them. At time 1, I have 50,000 TYPs. I then spend that on an AA flight, and at the end of it (time 2), I walk away from a flight worth $800 PLUS the value of the miles I’ve accrued. Of course the direct value generated is $800, but the TOTAL value generated must include the value of the miles, since I received those through spending the TYPs. That value is directly tied to the spending of TYPs, although it is downstream. Therefore, value per TYP would be ($800 + Value of Downstream Benefits, such as miles accrued) / 50,000 TYPs.
In direct response to Gary’s comment, I would say more generally that cash is indeed worth more than the value of cash if it generates further downstream benefits. If I spend $500 on an airline (or any other business) that doesn’t have a loyalty program, I get a straight $500 of value, which comes in the form of the flight. However, if I spend that same $500 on an airline that does have a program and I can accrue miles, then I’ve generated $500 worth of benefit (from the same flight) PLUS the value of the miles. In that sense, I’ve generated more value than the straight cash value of the flight itself.
How does the airline credit impact the minimum spend requirement? If you receive the credit in the first three months, does that mean you actually have to spend $3,250 to get the bonus?
Gary:
I do like the 1.6x the Prestige card booking gives you, plus the AA miles on the flight, so, I would value it higher than the 1.6x total return.
My son has been trying to get a Citi TU card, to set up a Citi relationship and a CitiGold Checking. He has a 760 FICO/perfect pay, but a 8 year old bankruptcy. He has Discover, Barclay, PenFed, but can’t get Amex until bankruptcy clears off.
Which Citi TU card do you think is the easiest entry for him?
Thanks!
@John Stewart – If he can’t get one of the premium Citi cards (although he might) I’d try ThankYou Preferred, whose points don’t transfer to miles, and then combine with a ThankYou Premier or Citi Prestige later in order to get more value from the points earned.
Chris –
Thanks, I think that you probably conveyed my point a bit more eloquently than I did.
“I would say more generally that cash is indeed worth more than the value of cash if it generates further downstream benefits.” – I agree. If I can buy a widget for $100 and have the option of paying cash/debit or paying with a 5% cash back card, I don’t think you could argue that there isn’t added value in the 5% cash back even if it doesn’t change the actual price of the widget.
Thanks!
He was turned down even after reconsideration for the Citi AA 50k offer a few months ago.
Are the TU cards easier to get through Citi, than the AA cards?
I was even thinking the Forward TU card, geared more toward students, might get his foot in the door more easily, then the premium cards, after he has the card and CitiGold Checking (needs a TU card first).
Ben & Chris
So called downstream value, the value has no set point like in your example, 5%. It depends on many factores. Thus, very difficult to determine.
I have a question about the $250 airline credit. Can I buy gift cards the way you can with Amex?
@dhammer53 you don’t even need to, this works on airline tickets
Gary,
My question is, can I buy gift cards. The reason I’m asking is that gift cards have long expirations. 😉
Thanks.
@dhammer53 – “purchases made with airlines” qualify. So as long as you buy the airline gift card from the airline itself, and it’s a charge they process, it should count just fine.
Does anyone know or have experience whether Amazon purchases (gift cards, merchandise etc) shows up as “entertainment” in Citi’s categories ? I know Amazon purchases used to show up like video rental coding so was curious.
Tks
In order to get the 4th night hotel free, you have to book through the Thank You Points concierge. Are their prices competitive with the other online booking sites?
@Cindi you can even book AAA rates.