Published on July 17th, 2017 | by William Charles74
Keep, Downgrade, Cancel: Citi Prestige
Now that we know what benefits the Citi Prestige will have on July 23th after they have finished adding and removing benefits I thought it would be useful to do another post in our series: Keep, Downgrade Cancel. The aim of this post is to help current cardholders decide if it’s worth keeping the Citi Prestige card and if it isn’t if they should downgrade it to another eligible Citi card or just cancel it outright.
Card Benefits & Annual Fee
I think it’s a good line to outline what the benefits will actually look like after July 23th as I’ve seen a lot of confusion regarding this. This also gives us a base to work with:
- $450 annual fee. Some cardholders pay only $350:
- Citi Priority Account Package Holders
- Some who applied in branch also get a $350 annual fee
- $250 air travel credit each calendar year. As long as it codes as an airline it should trigger this benefit, datapoints can be found at the payments workshop
- Priority Pass Select Membership (good for two guests and immediate family)
- Makes Citi ThankYou Points worth:
- 1¢ for cash redemption
- 1.25¢ per point when redeeming for airfare through their portal
- Fourth night free on hotel bookings when you book through Citi (based on the average nightly rate).
- Instant discount when you book online
- Statement credit when you book via the Citi Concierge
- $100 Global Entry/TSA PreCheck Credit
- Can transfer points to 11 airlines & 1 hotels. They also sometimes offer transfer bonuses.
- Citi Concierge
- Card earns at the following rates:
- 3x on air travel & hotels
- 2x on dining & entertainment
- 1x on all other purchases
- Generous travel delay protection
Deciding whether to keep the card should be a simple matter of deciding whether the benefits outweigh the $450/$350 annual fee or not. The most valuable benefits are:
- $250 air travel credit. Keep in mind this is based on a calendar year, but in your first card member year you should have used it twice. This means card member year two onwards you will only be able to use it once. This always confuses readers so let me give an example. You signed up for the card in May of 2016, you immediately spent $250 on airfares and were reimburse. On January 1st 2017 the credit reset and you used it again. When the annual fee became due in May of 2017 you could pay it and use your credit again in 2018 before the annual fee was due again. In your first year you used it twice and second year onwards you’ll only be able to use it once for every annual fee you pay. I don’t think air travel credit is equal to cash, because it’s not as flexible and you could purchase discounted airline giftcards instead. It’s up to you to decide how much this benefit is worth.
- Priority Pass Select Membership. This gives you + two guests + immediate family access to priority pass lounges for free. Lots of other premium cards also come with lounge access so for some people this is worth a lot and for others it’s worth nothing.
- Fourth night free benefit. This is another one that can be worth a lot, especially if you have a job that reimburses you for hotels and then you get to pocket the fourth night rebate. Can also just be used for people with paid hotel stays of four nights or more.
The other benefits I either consider fringe or they come with other Citi ThankYou point earning cards. If you value the air travel credit at $250 (I like to value it at 90% of face value or $225 but work out your own number) then you need to value the other benefits at $100-$225 depending on the annual fee you pay as well.
Before looking at downgrading or canceling it’s important to keep in mind the Citi 24 month family rule. This states you’re not eligible for another Citi ThankYou point bonus if:
Bonus ThankYou points are not available if you have had ThankYou Preferred, ThankYou Premier or Citi Prestige cards opened or closed in the past 24 months.
This means that cancelling your card will reset this 24 month clock. We still don’t know for 100% certain how downgrades are treated, but believe they also reset the 24 month clock. This means it might be worth keeping the Prestige open if you’re close to it being 24 months since you opened the card.
The rules for downgrading Citi cards can be found here. Some reps will say that you must downgrade it to another ThankYou point earning card, but that isn’t true. Just hang up and call again. In terms of the best downgrade options I personally think it’s between three cards:
- Citi Dividend. No annual fee and earns 5% cash back in rotating categories. There is an annual cap of $6,000 in spend (that means you can spend the full $6,000 in a quarter unlike the Chase Freedom & Discover it). Good if you can manufacture spend in any of the categories they offer.
- Citi Thank You Preferred: No annual fee and earns 2x points on dining and entertainment.
- Citi ThankYou Premier: $95 annual fee, 3x on travel & 2x on dining (travel category is more broad than the Prestige card).
In my opinion this should always be your last option, I don’t really see any point in cancelling if you can pick up a Citi Dividend for free.
It’s really hard to give definitive advice on this card, it becomes even more complicated when you start taking into account whether it’s worth keeping the card open so you don’t reset your 24 month clock. I think a lot of people will find it is worth keeping the card open just because of that, for example let’s say you’ve had the card opened for 12 months if you keep it open for another 12 months you’ll pay another $350/$450 annual fee but then you’ll be most likely able to get another 50,000 point bonus (or even higher) on the Prestige or Premier plus you’ll get the $250 air travel credit. Whereas if you cancel/downgrade now you’d need to wait an additional year before that is possible.
The other thing that’s important to remember is that you should be calling retention to see what they will offer you for keeping the card (even if you plan to keep it, call anyway). I suspect Citi will be eager to keep their retention rates high (as American Express was when they announced their changes) so the possibility for outsized value is quite high. You can read our guide to retention offers here. What are your thoughts on the Citi Prestige, will you keep, cancel or downgrade it?