Cash back credit cards are a great way to accumulate savings while making your everyday purchases including groceries, gas and dining out at restaurants. However, all cash back credit cards have their own unique terms and conditions. You have to look at how each one works to determine which cash back card would give you the most savings.
The new Citi Custom Cash Card has several features that make it attractive.
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Cash Back Details
From the start, the Citi Custom Cash Card gives you 5 percent bonus cash back on your first $500 spent on your highest eligible spend category for each billing cycle. After that, you earn 1 percent cash back on all other purchases with no limit.
The spend categories eligible for the bonus cash back cover practically all of your household spending:
- grocery stores
- gas stations
- streaming services
- home improvement stores
- fitness clubs
- select travel
- select transit
- live entertainment
If you spend $750 on purchases within the first three months after you open the account, you get $200 cash back.
Consider also: How to Redeem Your Visa Reward Points
Fees and Interest Rates
The Citi Custom Cash Card does not charge an annual fee, unlike some other cash back cards.
You'll also get a zero percent introductory interest rate on purchases and balances for the first 15 months. After the introductory period ends, the interest rate will increase to a range from 13.99 percent to 23.99 percent, depending on your creditworthiness.
However, the balance transfer fees can get expensive. The Citi card charges a balance transfer fee of 5 percent or $5, whichever is higher.
Redeeming Your Rewards
You can redeem your rewards by getting a credit on your account, receiving a check or having a direct deposit to your bank account.
Cash Back Terms
A major advantage and convenience of the Citi Card is that you don't have to select a bonus category to get the maximum 5 percent rewards each month. The system analyzes the changes in your spending habits and selects the category automatically for you.
Other cash back credit cards require you to select a bonus category each month or quarter, otherwise, if you forget, you won't get the bonus percentage. In addition, some credit card issuers select the eligible bonus categories each quarter, and the ones they select may not fit your spending habits. If they don't match, you lose.
The 5 percent bonus cash back is limited to the first $500. If you spend more, you might be better off with another cash back card that has a higher bonus limit. The Citi Card only gives you 1 percent cash back on additional purchases whereas other cash-back cards may give you 1.5 percent or 2 percent cash back.
By examining your spending habits and amounts, you can compare the terms of cash back credit cards to find which one will give you the most savings.
Consider also: How to Use a Credit Card for Gas
Pros and Cons
There are the major benefits to the Citi card:
- no annual fee
- zero percent introductory APR
- 5 percent rewards on bonus categories
There are also downsides:
- giving up the 5 percent bonus rewards when you spend more than $500 on non-bonus categories
- a low rewards rate for purchases outside the bonus categories
- needing a good to excellent credit score, meaning above 670, to qualify
- Citi: Citi Custom Cash Card
- U.S. News: Citi Custom Cash Card Review
- finder.com: The New Citi Custom Cash: Should You Get One?
- Forbes: Score 5% Back In Your Top Spending Category With New Citi Custom Cash Card
- Bankrate: Citi Custom Cash℠ Card review: Innovation or inconvenience?
- USBank: 5% Cash Back on Two Categories You Choose