Gary Leff of View From the Wing (H/T) has reported today that some changes are coming to the Citi Premier in August 2020. In its current state, the Citi Premier is one of the highest earning travel cards for international airfare. But Citi is changing its earning structure and some rules about redeeming points later this summer.
Currently, the Citi Premier earns 3x Thank You (TY) points on General Travel and Gas purchases. It also earns 2x TY points on Dining and Entertainment purchases, as well as one point per dollar on non-bonus spend. This is a great earning structure that I am surprised to see change.
Furthermore, the Premier comes with a sign-up bonus worth 60,000 TY points. It can be earned by spending $4,000 within the first three months.
What’s Going On?
Sign-Up Bonus & Annual Fee
The Citi Premier’s sign-up bonus and annual fee will remain the same. No changes will be made.
Earning Structure
Moreover, the Citi Premier’s earning structure is getting a makeover. Starting on August 23, 2020, the Premier will earn 3x TY points on Grocery Store, Dining, Gas, Air Travel, and Hotel purchases. There will no longer be any 2x bonus categories. In other words, the Premier is losing its 2x Entertainment category as well as its General Travel category.
Update: The Citi Premier earns 3x TY points on Grocery Store and Dining purchases as of June 2, 2020.
Burning
Furthermore, on April 10, 2021, cardholders will no longer receive 1.25 cents per point (CPP) on travel booked with Citi’s Thank You Travel Center. They will earn just 1 CPP like Citi Prestige cardholders. This is a 20% devaluation for this redemption option.
Unfortunately, this is one of the most valuable parts of the Citi Premier. And now its going the way of the dodo bird.
Perks
Plus, Citi will begin offering a $100 credit on one hotel stay costing at least $500 every year. This credit is a nice way to justify the Premier’s $95 annual fee. However, you must book the hotel stay through thankyou.com, whose rates are usually more expensive than average. This extra expenses can be considered an opportunity cost of using the credit. It’s also a sneaky way that Citi makes money.
The Citi Thank You Preferred Is Changing Too
The Citi Thank You Preferred was discontinued a few years ago in favor of the Citi Rewards +. However, its earning structure is changing too. Grandfathered cardholders will also earn 2x TY points on select Streaming Services, Cable TV, and Live Entertainment.
Analysis
There is a lot going on with the Citi Premier in August 2020. I am surprised to see Citi changing their most solid travel credit card. Unsurprisingly, most of these changes are for the worse.
The Premier will become a better dining and grocery store card in an attempt to compete with the American Express Gold Card. However, the Gold Card is a better earner (that earns a better transferrable currency) in both categories despite its higher annual fee.
Nonetheless, Citi has limited its General Travel category to just Air Travel and Hotels. This makes the Chase Sapphire Cards and the American Express Green Card better for less conventional travel expenses, such as toll roads and ridesharing.
Another disappointment is the Citi Travel Center devaluation from 1.25 CPP to 1 CPP. This is a 20% devaluation, which can be huge for travelers who love Citi’s Travel Center. After August 23, 2020, the only valuable redemption option left for Premier cardholders is transferring points to partners. Transferring is the best option for international travelers. But there are now much better cards for hotel and domestic flight redemptions.
Finally, Citi is adding a $100 hotel credit for hotel stays that cost at least $500. This credit can be a great way to justify the Premier’s annual fee if you can use it every year. Therefore, this is one of the few bright spots from this overhaul.
Final Draw
I am surprised and disappointed in Citi’s decision to revamp the Premier Card. As it stands right now, the Premier is Citi’s most well-rounded credit card for international travelers, especially those with non-traditional travel expenses. But changes are coming to the Citi Premier and we must adapt as such.
While not everything is changing, some of the card’s biggest value points are. Fortunately, Chase, American Express, and other issuers offer excellent alternatives to the Citi Premier.
I’d already decided to cancel the Citi Prestige card when my renewal comes around. Now they’ve convinced me to cancel the Premier card as well.
I’ve stopped considering Citi altogether because they change their card features too often