Citi has just released a new cash back card that is the best on the market:
You earn 1% back when you make a purchase and another 1% back as you make payments. You should, of course, pay in full every month to avoid interest. This has the added benefit of getting your cash back more quickly.
This card is slightly better than the Fidelity Investment Rewards American Express, which offers 2% back and no annual fee, for three reasons:
- The Citi Double Cash is a MasterCard, and the Fidelity card is an American Express. MasterCards are more widely accepted.
- The Citi Double Cash’s rewards can be redeemed in increments of $25 for statement credits. You have to wait until you have $50 in rewards on the Fidelity card.
- The Fidelity card requires you to have a Fidelity account. That’s one more step.
The Citi® Double Cash Card – 18 month BT offer also clearly has a chip in its promotional images. I don’t see whether it’s chip and PIN (more useful) or chip and signature, so I’ll hold off on calling this a benefit.
- How does the Citi Double Cash Card compare to the Arrival Plus and miles earning cards?
- Who should not get the Citi Double Cash Card?
Cash Back vs. Arrival Plus vs. Miles
Many miles and points cards have category bonuses that allow you to earn 2, 3, or 5 points per dollar. Those are clearly superior to the base earning rates on the Citi® Double Cash Card – 18 month BT offer and Barclaycard Arrival PlusTM World Elite MasterCard®. But let’s look at non-bonused spending.
vs. Arrival Plus
The Barclaycard Arrival PlusTM World Elite MasterCard® earns 2 miles per dollar on all purchases, which is worth 2.15% back toward travel. In May, Barclaycard expanded the definition of travel, so that you have a ton of options to redeem Arrival miles for statement credits.
I think most readers of this blog spend more than 2.15% of our budget on things defined as travel by Barclaycard, so to me the 2.15% is just like cash. The only reason this card isn’t hands down better than the Citi® Double Cash Card – 18 month BT offer is that it has an $89 annual fee after the first year, and the Double Cash Card never has an annual fee. You’d have to put almost $60,000 in spending on the Arrival Plus before the extra 0.15% added up to $89.
vs. miles/points earning cards
Generally I prefer miles over cash back because I can do some awesome things with miles that are exorbitantly expensive with cash like fly first class and add in stopovers and open jaws.
However if I use a miles-earning card and earn 1 mile per dollar, I am giving up earning 2% or 2.28% back. That’s like buying a mile for 2 or 2.15 cents. That’s a terrible deal.
If my options were to use a miles-earning card or the Citi® Double Cash Card – 18 month BT offer for a non-bonused purchase, I would take 1% + 1% cash back over 1 mile per dollar all day. I try not to earn 1 mile per dollar, though, by having cards with an array of category bonuses and putting a lot of my spending toward big sign up bonuses.
Who Should Not Get the Double Cash Card
Don’t get the Citi® Double Cash Card – 18 month BT offer if you want to fly international first class. Those tickets are routinely $10,000+, so you’d need a ton of cash back to get you into a flying bed.
The way to get into international first class is with airline miles. Even at 1 mile per dollar, you’ll get into international first class much faster than with 1% + 1% cash back. Some of the world’s nicest products like Singapore Suites and Cathay Pacific First Class can be had for 58,000 to 70,000 airline miles one way.
You probably wouldn’t get a cash back card to get into first class, but you’d be saddened to learn how many people come to my Award Booking Service with cash-like points that are worth a fixed value toward any flight and want to fly first class. That doesn’t work. You want airline miles or points that transfer to airline miles.
The Citi® Double Cash Card – 18 month BT offer is the best cash back card on the market. It is slightly better than the previous best, Fidelity card.
It’s a legitimate option for non-bonused purchases instead of cards that earn airline miles or Arrival miles. I’m not going to get the card for now because I have the Barclaycard Arrival PlusTM World Elite MasterCard® already.
Application Link: Citi® Double Cash Card – 18 month BT offer
Editorial Disclaimer: The editorial content is not provided or commissioned by the credit card issuers. Opinions expressed here are author’s alone, not those of the credit card issuers, and have not been reviewed, approved or otherwise endorsed by the credit card issuers.
The Chase Sapphire Reserve comes with 100,000 bonus Ultimate Rewards after spending $4,000 in the first three months that you can transfer to United miles, Singapore miles, Southwest points, British Airways miles, or use for 1.5 cents each toward any flight, hotel, or car rentals.
Plus the card offers $300 in credits toward any travel purchase each calendar year, which is $600 in your first 12 months of cardmembership, $100 toward Global Entry, and worldwide lounge access. Basically it's the best credit card ever, even with a $450 annual fee.