[Update 2016/5] Starting November 1, 2016, Citigold customers need to maintain $200,000 in total assets or they will be automatically downgraded. In addition, Citi has recently started denying points to new customers who were not targeted but entered the Promotion Code below when applying. If this happens to you, it may be worth pushing back with Citi, though success is YMMV. 
Citigold is Citi’s premium checking account brand. Citi recently launched a new promotion: open a new account (you must not currently have a Citi Checking account) and meet certain requirements to earn 40,000 ThankYou Points or 50,000 AA (American Airlines) AAdvantage miles (the usual offer is 40,000 TYP / 30,000 AA). If you recently applied for the Citi Prestige credit card, opening this account can also reduce the Prestige annual fee by $100 to $350, which is an excellent deal. Even if you later close the account, the $350 annual fee remains in effect.
[How to apply] Citi Checking Account, and enter the following Offer code:
- 40,000 TYP: expired (you must have ThankYou Preferred, ThankYou Premier, or Citi Prestige)
- 50,000 AA miles: expired (you must have a Citi AAdvantage credit card to see this offer)
Or apply in person at a Citi branch. Note that Citi will soft pull your credit report for identity verification. Although an SSN is required, there will not be a hard pull. You will also need to fill out a W9, so the account holder must be a tax resident (for example, F1 holders within their first 5 years are not).
[Requirements]
- 50,000 TYP: within 60 days of account opening, complete 1 qualified bill payment in each of 2 consecutive calendar months. The easiest method is to set up an automatic bill pay in Citi online banking and pay $10 each month to your own non-Citi credit card. Note that payments to a Citi credit card do not qualify.
- 50,000 AA miles: in addition to completing the first requirement, you must also complete the bill payment requirement within 60 days and spend $1,000 on the debit card within 60 days. For details, click here.
[Monthly fee] The monthly fee is waived if the average balance across all Citi accounts is above $50,000; otherwise it is $30 per month (the first two months after opening are free).
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Citibank Checking and Citi Basic Banking
This offer also includes two lower-tier checking accounts: Citibank Checking and Citi Basic Banking. These do not require maintaining as much as $50,000 in deposits, but the rewards are much smaller than with Citigold. Citigold, Citibank Checking, and Basic Banking earn 50,000 / 20k / 10,000 TYP respectively, and 50,000 / 15,000 / 5,000 AA miles respectively. Although Citigold has a higher monthly fee if you do not keep $50,000 on deposit, you can generally close or downgrade the account after receiving the bonus around month 5. Even if you pay the fee, that is only $90 total, yet you come out ahead by an extra 30,000-40,000 TYP, which is worth far more than $90. For that reason, Citigold is the smarter choice, and it also comes with the Prestige annual fee discount.
Pros of Citigold
- A checking account with such a large signup bonus is extremely rare.
- The Citi Prestige annual fee can be reduced by $100.
- As long as you have Direct deposit and Bill payment each month, you can easily earn 650 TYP monthly.
- TYP can be redeemed through Citi Prestige/ThankYou Premier at a higher value for flights or hotels.
Cons of Citigold
- You need $50,000 in deposits to avoid the monthly fee. If you do not keep that much cash around, consider closing the account after receiving the points.
- Bank-earned TYP are more cumbersome to use, and you need to plan carefully to avoid triggering a tax form from Citi.
- Points earned through the bank account (not credit cards) cannot be transferred to airlines or hotels.
Funding a bank account with a credit card
One very unusual feature is that Citi allows you to fund a new checking account with a Visa or Mastercard credit card for the initial deposit, up to $100,000. Since some banks, including Citi, BofA, and Barclays, may code this funding as a purchase rather than a cash advance, you may be able to meet a credit card minimum spend requirement at the same time (for example on a card with a high spending requirement like the Citi AA Executive) or use it for manufactured spending. However, although there are many data points showing that Citi, BofA, and Barclays treat Citi checking account funding as a purchase, we still strongly recommend checking the latest Doctor of Credit data points before funding, and calling your credit card issuer to set your cash advance limit to $0 to avoid expensive cash advance fees.
Using TYP: how to avoid receiving a 1099-MISC
Within a calendar year, rewards redeemed from ThankYou Points earned through bank accounts are taxable (this does not include TYP earned from credit cards). If you redeem more than $600 in value from these bank-earned TYP in one year, Citi will issue a 1099-MISC. If you receive this form, that income will be included in your total income and subject to income tax, significantly reducing the value of the deal. Therefore, I recommend keeping track of the TYP earned from Citigold. Each time you redeem TYP, record how many of the points came from Citigold and how much value was redeemed from them, so you can avoid redeeming more than $600 in bank-earned TYP within a single year. Since Citi automatically uses the points that expire first, you can go to the ThankYou website and check View all expiring points to see the expiration dates of all points and determine which bucket a redemption comes from. For example:
Because Citigold TYP expire first, those points are used first when you redeem TYP. If you redeem 10,000 TYP for an AA ticket, 650 points would come from Citigold and the rest would come from your credit card points. If the redemption is fewer than 650 points, then all of it would come from Citigold.
Closing the account
One important thing to note is that ThankYou Points earned through Citigold will expire 60 days after you close the account. You cannot preserve them by transferring them to another account; you must use them before then. AA miles are not subject to this rule and will not expire.
Should you apply?
For anyone who has just applied for or plans to apply for the Citi Prestige, Citigold is a very attractive option. You can get the $350 annual fee without spending $15,000. And given the current 50,000 TYP / AA promotion, it is still worth it even if you do not have the deposits and need to pay 3 months of account fees. Here is our recommended strategy (and you may also want to read this other post on how to maximize this deal):
- Apply for the Citi AAdvantage Executive, and call Citi to set the cash advance limit to $0.
- Apply for a Citigold account using the 50,000 AA miles offer, and fund it with $7,500 or more (up to $100,000) from the AA Executive to complete the AA Exec minimum spend requirement, earning the AA Exec 75,000 signup bonus plus 7,500-100,000 AA miles from the funding amount.
- Complete the bank account requirements and earn the 50,000 AA miles bonus.
- Apply for the Citi Prestige 50,000 offer version with the $350 annual fee, complete the $3,000 minimum spend requirement, and earn 53,000 TYP.
- After confirming you received the 50,000 AA miles, downgrade or close the account if you do not have $50,000 on deposit to waive the monthly fee.
- Close the AA Exec before the second annual fee posts. The Citi Prestige may be worth keeping long term depending on your situation.
If everything works out, the cost is two HPs + the $450 annual fee on the AA Exec + up to $90 in account fees. In return, you get 132,500-225,000 AA miles + 53,000 TYP + one year of benefits from the AA Exec (including Admirals Club) + a Citi Prestige with a $350 annual fee! A rough valuation easily exceeds $2,900-$4,500.
Have you applied for Citigold? Share your experience!