How We Chose Our Credit Card
Recently, my wife and I were looking at our credit cards. We got to thinking about credit cards after reading a post over at The Simple Dollar, and decided to consider changing our card. At the time, we had no idea we’d wind up with the same card that was discussed there.
I’ve had the Citibank AAdvantage card for years. In my previous job, I traveled constantly and racked up many, many miles on American Airlines. I used this card to increase the number of miles I had (I had a goal of hitting a million before travel burnout kicked in). Even though I quit that job years ago I still had this card (and was still racking up miles). After flying so much for work I have little interest in flying for pleasure right now. Earning more miles was no longer a valuable benefit to me and on top of that I was being charged a yearly fee for those rewards. It was time to change cards to get a rewards program that made sense for our current lifestyle.
We view credit cards as a convenient way to make purchases and earn rewards. We use them extensively but we always pay the balance off in full every month so we don’t pay interest.
Our criteria for choosing our card :
- It had to be with Citi. This is because of our relatively long history with them. Although the card number would change, my credit still reports a long history because I’ve stayed with the same company for so long.
- It had to support virtual credit card numbers. We use these almost exclusively for online (and even some offline) purchases.
- It had to provide rewards in the way of cash or in a way that was roughly equivalent to cash (e.g. gift cards, reimbursement for expenses, etc..)
- It had to have a low interest rate. Although we don’t allow ourselves run a balance we wanted a low interest rate in case we hit emergencies beyond the amount in our emergency fund. We hope to never have to worry about this.
Armed with this, we went to the Citicards site to see which cards made the most sense. Citi has a nice utility to help you find the right card by allowing you to choose the features that are important to you. We selected Cash Back, and No Annual Fee for our search. All the other options didn’t really matter much to us. We were left with just a few (non-business) cards to look at :
- Citibank Options Platinum Driver’s Edge
- Citibank Dividend Platinum Select
- AT&T Universal Savings Platinum Card
- Citi Dividend American Express Card
- Citi Cash Returns Card
- Citi Professional Cash Card
- Citi UPromise Platinum Select Card
- Citi Home Rebate Platinum Select Mastercard
Whew! How many adjectives can you use to describe a credit card?
We quickly eliminated the American Express (not always accepted), the UPromise card (we don’t have children), and the Home Rebate (we are already all set to move into a new home).
That left us with 5. We started reviewing the terms and conditions on each of these cards (you should go to their website for the latest information – this data could be old, but seemed to be valid at the time we checked) :
- Citibank Dividend Platinum Select – 2% on purchases made at supermarkets, drugstores, gas stations, convenience stores, and utilities including cable, 1% on everything else. Maximum of $300 back (with some exceptions for special purchases)
- Citibank Options Platinum Driver’s Edge – 3% rebates on purchases made at supermarkets, drugstores and gas stations. You earn 1% rebates on other purchases. (we don’t qualify for the introductory 6%). No cash back, but maximium $1000 back in rewards points and rebates. You can save up to $5000 toward a car (5 years at $1000 each). You can also earn $0.01 per mile driven (with some restrictions)
- AT&T Universal Savings Platinum Card – We ruled this one out when we read that it was only rebates when you purchased AT&T products and services. We don’t use AT&T for anything.
- Citi Cash Returns Card – 1% cash back (we didn’t qualify for the new cardmembers limited time 5% offer). When you hit $50 “Citi Dollars”, Citi sends you a check for $50.
- Citi Professional Cash Card - You will earn 3% on purchases made at gas stations, restaurants, certain office supply merchants and on auto rentals (we don’t qualify for the intro offer again). 1% on everything else.
Again, please check out the Citicards website for the latest information. Things could be completely different by the time you read this article, so you should always confirm the latest information by reading the terms and conditions on credit cards you are interested in.
So, from that list, we can eliminate AT&T Universal (we don’t use any AT&T products or services), Citi Professional (too limited on where you get your 3% cash back, and not really applicable to us), and the Platinum Select (it’s only 2% in places where Driver’s Edge is 3%, and it’s limited to $300 back a year although it is cash).
That left us with the Cash Returns card, and the Options Platinum Driver’s Edge card. The cash returns card was only 1%, and in the end we decided that even though cash back is great, we think we could earn more with the higher percentage from the Driver’s Edge card than we could from the Cash Returns card. With the Driver’s Edge card, we can convert our rebates to rewards through the Citi ThankYou Network. The ThankYou network is Citi’s “shopping mall” where you can spend your points on gift cards, household items, or other items we might normally have to spend “real money” on. I checked it out, and I think by converting the rewards points into ThankYou points, we can get more out of the program because we can get up to $1000 worth of items. I see it as a way to get things we might not normally get, and not have to feel guilty about it. The main item we’ll be getting is restaurant gift cards. This way, we can treat ourselves to a nice meal out and not affect our budget.
In the end, what we chose might not make sense for everyone. For us, it seemed to be the best choice and fit our desires. Now I feel like I’m at least earning rewards that I will use more frequently than I would with the airline miles.
As an added note, if you decide to go with the Citibank Options Platinum Driver’s Edge, make sure you get that card specifically. If you get a Charter Driver’s Edge, you won’t get the full benefit, and can’t convert your points to ThankYou network points.
Image from Wikimedia Commons