Citi Double Cash Card Review: Is It an Ideal Cash Back Card for You?
The Citi Double Cash is a cash rewards credit card that offers a 2 percent cash back rate on purchases: 1 percent when you make a purchase and 1 percent when you pay it off.
What makes the card so interesting is that it’s the only mainstream cash rewards card to offer 2 percent cash back, but, on the other hand, it’s the only one mainstream cash-back card that rarely offers an up-front cash bonus.
In this review, we’re going to help you understand how this cash rewards card works, what its rates and fees are and how it compares to other cash back cards.
This type of approach to the Double Cash will help you understand exactly what you can expect from the card and, furthermore, help you see how it may benefit you (or not benefit you) compare to other cards.
At the outset of this review, we said that the Citi Double Cash is a cash-back credit card. What this means is that nearly every purchase you make is going to earn rewards. At a 2% rate, you’d earn in cash 2% of every purchase.
So, if you spend $100 at Target, you’ll $2 in cash rewards. Citi automatically calculates those rewards and then deposits them to a balance that you can view when you log into your Citi account.
But, remember, the 2% is split into a 1-percent rate on what you spend and a 1% rate on how much you pay off.
So, if you’re someone who tends to carry a balance on your credit card, then all those dollars on your card aren’t going to earn any rewards until you pay them off.
This is both a good and bad trait of this card. It’s good because it provides you an incentive for paying off your card. The more you pay off, the more you get back in cash rewards.
However, some of us fall on hard times or are bad at budgeting and we tend to spend more than we earn. We end up charging things to our Double Cash that we can’t pay off, so those balances sit on our card and they never earn the additional 1 percent.
To compound this issue, you won’t earn rewards on interest. So, all the interest payments that pile up on your account as you carry a balance aren’t going to get rewards, either. This same rule applies to any fees you rack up for paying late.
The takeaway here is that the Citi Double Cash is best suited if you pay off your credit card balance every month and can take full advantage of the rewards potential the card offers.
While paying off your balance is a widely-accepted rule of thumb for using a credit card, it’s especially important with this because of the rewards payout.
What’s missing from the card’s rewards is a sign-up bonus like the one you’d get from the Chase Freedom Unlimited or the Quicksilver from Capital One, both of which give you $150 in rewards if you can spend $500 in the first three months of owning the card.
An added benefit to this card is that it will give you 0% interest for the first 18 months of any balance transfer you complete within the first four months of owning the card.
For the smart consumer, this card’s balance transfer offer can help you save a considerable amount of money. Instead of paying interest on a balance you have on another card, you can transfer it to the Double Cash and avoid interest payments for a year and a half.
However, there’s a bit of a hidden cost to making a balance transfer that we’ll talk about in the rates and fees section.
Additional benefits you get with this card include:
- No late fee on your first late payment
- Lost card replacement within 24 hours
Understanding how much the Double Cash’s rates and fees can cost is a good way to understand the true drawbacks of a credit card that go beyond, for example, a lack of signup bonus.
We’ll provide you a quick list of this card’s rates and fees, then give you a picture of how much your interest rates can cost you over the course of the year:
- Interest rate for purchases and balance transfers: 15.75%–25.74%
- Interest rate for cash advances: 27.49%
- Penalty interest rate: 29.99%
- Balance transfer fee: $5 or 3%, whichever is greater
- Cash advance fee: $20 or 5%, whichever is greater
- Late/returned payment fee: Up to $39
- Foreign transaction fee: 3%
There are a lot of rates and fees here. The ones that will be most pertinent are the interest rate for purchases and balance transfers, as well as the balance transfer fee.
The interest rate for purchases and balance transfers is also known as “APR,” which stands for “annual percentage rate.” Whenever you don’t pay your balance off on your due date, then Citi will apply your APR to the balance.
Citi bases your APR on your credit history. The lower the scores, the higher your interest rate will be. If your scores are over 700, you’re most likely to get the lowest APR.
So, if you had the 15.75% rate and you carried a balance on your account of around $1,000 a day, then one month of interest payments would be around $13.12 a month and $157.50 for the year.
If your balance is, on average, $2,000 a day, then you can double those interest payments, and so forth.
The second fee we want to point out is the balance transfer fee, which is what we mentioned earlier. Transferring a balance to this card will cost you 3% of the balance if the balance is higher than around $170. If it’s under $170, then you’ll pay a $5 fee.
So, if you transfer a $1,000 balance, you’ll pay a $30 fee. However, if that balance was racking up, say, $157.50 in interest every year, transferring the balance isn’t a bad idea. Over the course of 18 months of 0% interest that you get with the Double Cash, you could save yourself around $205 in interest after fees.
Our advice here is simple: Don’t carry a balance and you’ll save yourself hundreds in interest payments.
Finally, we want to point out that the card has a penalty interest rate. This rate—29.99%—kicks in if you have one late or returned payment. This APR will not apply to current balances; only future ones. However, the penalty APR will stay on your account forever.
Our research reveals there are seven mainstream cash rewards credit cards that you’ve probably seen. The following chart compares the sign-up bonus, yearly rewards and interest rates of these seven cards:
|Citi Double Cash||AmEx Blue Cash Preferred||Discover It Cash Back||Bank of America Cash Rewards||Capital One Quicksilver||Chase Freedom Unlimited||Chase Freedom|
|Intro cash offer||None||$200 after $1,000 spend||Match on first-year cash back (avg. of $425)||$200 after $1,000 spend||$150 after $500 spend||Match on first-year cash back up to $20,000 (avg. of $300)||$150 after $500 spend|
|Rewards rate||2%||6%/ 3%/ 1%||1% with 5% quarterly bonuses||3%/ 2%/ 1%||1.5%||1.5%||1% with 5% quarterly bonuses|
|Yearly rewards on $30K spending||$600||$605||$425||$422||$450||$450||$425|
|Intro APR||0% for 18 months on balance transfers||0% for 12 months on purchases and balance transfers||0% for 14 months on purchases and balance transfers||0% for 12 months on purchases and balance transfers||0% for 15 months on purchases and balance transfers||0% for 15 months on purchases and balance transfers||0% for 15 months on purchases and balance transfers|
|Permanent APR||14.49%–24.49% (Penalty APR up to 29.99%)||15.24%–26.24% (Penalty APR up to 29.99%)||14.24%–25.24%||16.24%–26.24% (Penalty APR up to 29.99%)||16.24%–26.24%||17.24%–25.99%||17.24%–25.99%|
Which card is best for you really has to do with what you want out of it. If it’s a card that you want to use for a year and move on, then the Chase Freedom Unlimited is the best choice. It has no annual fee and your first-year rewards on $30,000 of spending would be $750.
However, if you’re someone who is looking for a card that can earn some cash rewards on the side as you try and pay down a balance you transfer, then we’d say that the Double Cash is the best choice because of its 18-month 0% offer.
Now, if you’re looking for a card that you can use for more than one year, then, rewards-wise, the Citi Double Cash is the best choice here because it earns $600 per year. The American Express Blue Cash Preferred earns more per year than the Double Cash. However, it has a $95 annual fee that drops its net rewards below the Double Cash.
Another interesting observation here is that the Discover it Cash Back card has rotating rewards. In other words, it has a flat rate of 1% but certain purchases get 5%. However, these 5-percent purchases change every quarter.
For example, one year the Discover it Cash card offered 5 percent back at grocery stores between January and March; a bonus for gas stations, Uber and Lyft the next quarter; restaurants in the third quarter and Amazon purchases in the last quarter.
You have to activate those rotating rewards. With the Citi Double Cash, you don’t have to activate or keep track of any special bonuses. Everything gets 2 percent.
And, as the chart above shows, Citi’s 2% flat rate provides better rewards than the Discover it Cash Back, despite the rotating 5% bonus. The same applies for the Chase Freedom, another card with rotating categories, and the Bank of America Cash Rewards card, which has bigger bonuses for certain purchases year-round.
» Recommended Reading: The Best Cash Back Rewards Card of 2019
As we look over the information we’ve presented here, we think there are certain types of consumer this card is good for. One of the most important factors, in our opinion, is the card’s penalty APR. And, for that reason, we think this card is a bad fit if you tend to make late payments.
That being said, you can easily avoid paying late and getting the penalty APR by automating your credit card payments via your Citi account.
We also think this card is an excellent fit if you’re the kind of person that wants a credit card that earns a ton of points and is as simple as possible to use.
Redeeming your points is as simple as transferring your rewards balance to your credit card statement, or by sending the balance to a checking count. Also, the card has no annual fee. So, in our opinion, this card about as low maintenance as you can get if you don’t make late payments.
Now, if you're someone who is looking for a card that can give you the best rewards for travel, this card probably isn’t right for you.
While the cash rewards are the best among the most popular cash rewards card, you can find better value from your spending by signing up for the Southwest Rapid Rewards Premier card or the Chase Freedom Unlimited and Chase Sapphire Reserve.