Citi $100 Sign Up Bonus With Extras

Posted by Madison on March 11, 2011

Just in time for Free Money Friday, there’s a new sign up bonus from Citi.

The Citi Dividend card is offering a $100 sign up bonus.

In addition to the sign up bonus, the Citi Dividend card has some of my favorite features including a 0% balance transfer fee, and 5% cash back on rotating categories.

However, it also has one additional feature, which I can’t possibly believe is true…. more about that later.

How to Get Your $100 Sign Up Bonus

  1. Apply for the Citi Dividend card.
  2. Make $500 in purchases during the first 3 months.
  3. Receive your $100 cash back bonus.

Citi Dividend Terms and Conditions

  • You may accumulate a maximum of $300 in cash back during any calendar year.
  • No annual fee.
  • Dividend Dollars earned on purchases through the Citi Bonus Cash Center are not subject to the $300 calendar year maximum accumulation.
  • Dividend dollars are payable in checks of $50 increments.
  • Dividend Dollars will not expire as long as you have qualifying purchase activity at least once every 12 months.

More on Citi Dividend

5% Cash back. The Citi Dividend card is another card that participates in the 5% rotating cash back programs. For the rest of the first quarter, you’ll earn 5% cash back on drugstores, health care and fitness purchases. During second quarter the 5% will be for home improvement, home furnishings, and home and garden purchases. All other purchases earn 1% cash back.

0% Balance Transfer Offer. The Citi Dividend card also has a 0% for 15 months for balance transfers and purchases. The balance transfer fee is 3%.

The Citi Extras

Everything looks pretty normal so far, right? Here’s the part about the Citi Dividend card reward program that stopped me dead in my tracks:

Your Citi Dividend Card account (“Card Account”) will receive a rebate based upon eligible transactions appearing on your current month’s billing statement. The only eligible transactions are purchases, cash advances and balance transfers.

and further:

You will receive five Dividend Dollars for each individual balance transfer transaction of $1,500 or more. Limited promotional offers do not apply to personal banking transactions you make using your card. So you will earn only 1% on these transactions.

I’ve never seen a card that earned cash back on balance transfers before!

So the way I’m reading it, we can get a 0% balance transfer for 15 months and pay a balance transfer fee of 3%…. AND earn 5 dividend dollars for the balance transfer?

I’m having a hard time determining the conversion ratio of the dividend dollars to real dollars, but they appear to use them interchangeably throughout their terms and conditions, so it looks like it might be 5%.

If that’s true, it looks like we might be able to earn 5% cash back on a balance transfer. After paying the 3% balance transfer fee…. did we just make 2% on the balance transfer? And if it’s true, is it repeatable?

Update: Thanks to readers Ifi and Wayne for figuring it out! The 5 dividend dollars for a $1500 balance transfer is like getting another 0.3% cash back.

However, since they follow up the five dividend dollars with the next sentence about earning 1% on “personal banking transactions”, it’s unclear whether or not a balance transfer is a personal banking transaction. If that’s the case, then based on our balance transfer math from earlier this week, we’d see that 3% fee turn into an approximate effective annual interest rate of: .89% to .95% with a $10,000 balance transfer when you factor in the $100 cash back and a rebate of 1%.

Either way, earning cash back on the balance transfer at any rate beats all of the balance transfers we looked at earlier!

I’m in total disbelief that this could actually be the way it works, and I did contact Citi to ask for clarification (I haven’t heard back yet). But I think this might be one I actually have to try to figure out how it will work. Obviously, I’m going to find out!

Sign Up for Citi


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Comments to Citi $100 Sign Up Bonus With Extras

  1. Hi Madison, I didn’t go to the Citi page, but just from reading what you typed, for the balance transfer, I don’t think you get 5%, I think you get $5. So if you transfer $1,500 or more, the 3% fee is $45, you will get $5 in dividend dollars. But then I think you’ll also get 1%, or $15 if you make a $1,500 transfer. So if I’m understanding it right, you’ll pay $45 and get $20 back.

    Ifi

    Ifi

    • Ifi,
      That would make much more sense! I knew there had to be something I was missing.

      Do you think they would really give us the 1% and the $5? That would be 1.3% cash back then for $1500.

      Back to my spreadsheet to recalculate the effective interest rate. If they give us both, is should move it just a tad bit lower.

      Madison

      • But if you’re paying $45 and getting back $20, then it’s really not 1.3% on balance transfer, right? It’s just costing you less to do the transfer. Did I read your reply wrong?

        Ifi

        Ifi


      • Ifi,

        Right, not the total rate you are charged. That is what you’d subtract from the balance transfer rate.

        Or clearer… like you said: it’ll cost less to do the transfer!

        Madison


  2. I agree with the first comment.. Looks to me like it’s $5 for each $1500 balance transfer.

    Wayne

    • Thanks Wayne! I’ll update the article so nobody is confused with my crazy interpretation!

      Madison

  3. It really looks like a good deal since you get a $100 signup bonus. The only problem is I hate Citi/Chase from many past experiences. I have a feeling they’re gonna throw a mean curve ball down the road that will make the ‘free’ $100 feel like slave wages.

    jaymez619

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