About Citi ThankYou Preferred Card for College Students
When you’re a college student, it’s tough to get a credit card with good rewards. The Citi ThankYou Preferred Card for College Students is trying to change that by offering some interesting rewards and a special up-front bonus.
While the card’s rewards certainly aren’t unique, they are refreshing. Credit card companies tend to be real stand-offish with consumers who have low or no credit scores, two things you often find with college students.
In fact, 38% of those who are 30 or younger have credit scores below 620, a factor that severely limits their ability to get a good deal on a credit card.
When your credit is that low, you tend to get higher fees and interest rates and fewer rewards opportunities. It’s these usual metrics that make us a little excited about what the Citi ThankYou Preferred for College Students.
The card seems to break the cards-for-bad-credit mold, but is it really as awesome as it seems?
Over the course of this review, we’re going to try and answer those two questions by examining the card’s rewards, benefits, rates and fees, as well as what people say about it.
Rewards of the Citi ThankYou Preferred for College Students
We mentioned earlier that credit card companies don’t like handing out rewards if you’ve got low credit scores or no credit scores.
A lot of that has to do with risk. You see, bad credit scores, in theory, tell lenders that you’re more likely to not pay your bill or to pay late, which causes headaches for the credit card company.
So, they’re thinking, “Why give bonuses and rewards to customers that may be more trouble than they’re worth?”
Now, we’ve done some research and found that there are a variety of reasons why people have low scores and that the current credit-score models have their flaws.
Even though those things are true, it hasn’t really changed the way you get rewards. That’s why, in our opinion, it’s refreshing to see credit cards like the ThankYou Preferred for College Students.
2,500 ThankYou Points
Credit cards usually give their rewards programs and their rewards points a name. Citi uses “ThankYou” for both.
If you can spend $500 in the first 90 days of owning this card, then Citi will give you 2,500 ThankYou points. These points will show up on your ThankYou points balance, something you can see on the home screen of your card’s account page.
One point is worth one cent, which means your 2,500 points are worth $25. You can use those points for many things. Here are a few of your options (at the time of publishing):
- A $25 gift card to Home Depot, Macy's or Best Buy
- Redeem as credit toward purchases on your statement
- Transfer points 1:1 to multiple international airline carriers
Each of these choices offers decent value. The first and second options are the best if you don’t spend too much money on your card. If you’re spending $500 or so a month, then it would take you five months to earn enough points to get a gift card.
We say this because the third option is enticing, but flights will often cost at least 40,000 points for a round-trip ticket, an amount that could take you nearly seven years to hit.
2x and 1x Bonuses on Purchases
The second main rewards structure the ThankYou Preferred Card for College Students offers is points on purchases you make. Points on purchases is standard in the rewards industry; the main variation comes from the types of purchases and level of bonuses they make.
Your Citi card will get you 2x bonuses on restaurant and entertainment purchases. What that means is that anytime you make a purchase that qualifies as “restaurant” or “entertainment,” you'll get two ThankYou points for every dollar you spend.
If you spend $100 at a restaurant, you get 200 ThankYou points ($2 cash value).
The key to this 2x system is which purchases count as restaurants and entertainment, right? Well, that has everything to do with how the business identifies itself to Visa, MasterCard, Discover and American Express.
In most cases, any restaurant or fast food place you go to is going to identify as a restaurant. However, there are certain locations that don't and those are the locations that won’t get you the 2x bonus.
On the entertainment side of things, you actually have more options that you probably think. We read through the card's fine print and found that “entertainment” includes the following purchase locations:
- Live entertainment
- Live theatrical productions
- Live sporting events
- Movie theaters
- Zoos, aquariums, circuses & carnivals
- Amusement parks
- Museums, art galleries and other tourist attractions
- Record stores
- Video rental stores
- On-demand internet streaming
You’ve got all kinds of opportunities to earn double points. You have to remember, though, that these bonuses are only as good as your spending habits.
For example, if you only spend $500 a month and about $50 of that goes toward restaurants and entertainment each month, then you're getting about 100 points from the 2x bonus – that’s $1 in rewards.
Any purchase that doesn’t qualify as restaurants or entertainment will earn you one point per dollar. So, if you spend $450 on a month on 1x purchases and $50 on 2x purchases, your monthly points haul is 500. After five months, you’ll have enough points to buy a $25 gift card through Citi’s online store.
Benefits of the Citi ThankYou Preferred for College Students
Credit card companies dangle rewards in front of you to get you to bite on the card. Smart consumers will look beyond rewards to benefits – the card’s features that protect you from fraud and provide insurance on things you buy.
The rewards on this particular card aren’t that lucrative if you don’t spend a lot of money – about $25 after five months, or roughly $60 per year. The benefits the ThankYou Preferred for College Students, however, can be far more valuable than $60 per year.
Zero Fraud Liability
If someone steals your card or your card number and uses it to make fraudulent purchases, you won’t be liable for anything if you report the fraud in a reasonable amount of time.
In other words, if someone takes your card and charges $500 on it, Citi won’t expect you to pay anything to cover those losses.
If you use your Citi card to purchase something with a manufacturer's warranty, Citi will automatically add two years to that warranty.
This is a big deal if you’re buying electronics with your card, especially laptops, desktops, and smartphones. Here’s the great part, too: Citi will cover you, according to their benefits page, “up to the amount charged on your card or $10,000, whichever is less.”
Citi offers you a program called Price Rewind, through which they’ll reimburse you the difference if the price on something you bought with your Citi card drops within 60 days of your purchase.
Your Citi card comes with multiple other benefits, all of which you can read about when you get our credit card in the mail.
Rates & Fees of the Citi Rewind ThankYou Preferred for College Students
Your Citi card carries a series of interest rates and fees that you'll have to deal with if you pay late or don't pay off your balance every month.
Your APR will range from 15.49% to 25.49% depending on your credit score; the lower the score, the higher the interest rate. This rate will kick in if you don’t pay off your balance every month. The leftover amount you don’t pay will get hit with an interest rate every day and will be added to your balance each month.
The good news is that Citi will give you 0% interest on purchases for the first seven months. So, if you have a big purchase to make, you have seven months to pay it off before you're charged interest.
If for some reason, you pay late on the card, two things will happen. First, you'll be hit with up to a $35 late fee. Second, Citi will likely increase your APR to 29.99%, a rate that's known as the “penalty APR”. This may stay on your account indefinitely.
To avoid this, set up automatic payments on your card, choosing either to pay the minimum payment or the entire balance.
Other fees include a 4% fee for balance transfers, a 5% fee for cash-advance (26.24% APR, too), and a $35 charge if your payment is returned.
The card has no annual fee.
Public Opinion About the Citi ThankYou Preferred for College Students
The majority of the reviews about this card are positive and a lot of that has to do with the ThankYou Preferred for College Students’ rewards. There are very few credit cards for college students that offer the level of rewards you can get with it – 2x rewards on restaurants and entertainment, 2,500 bonus points, and points transfer to TrueBlue.
To give you an idea of why the card ranks so well, take a look at our article about credit cards for people with bad credit. Most of the cards on that list offer low or no rewards and none of them have the up-front bonus and 2x rewards that Citi's college-student card does.
Pros and Cons of the Citi ThankYou Preferred for College Students
We believe, based on our research, that this card's greatest strength is its overall profile of features. The rewards it provides lead the bad-credit niche.
You can't find another card with the 2x bonus on restaurants and entertainment, the up-front bonus and a formidable benefits package that protects your purchases in multiple ways and gives you the chance for reimbursement on price changes.
There is one clear drawback to this card – the penalty APR. This flaw makes the card a really high-risk, low-reward option for college students who don't have a steady income or have a history of paying late on their credit cards.
If you fall into one of those two categories, we suggest you take an honest look at your financial habits. If you can’t pay on time, then Citi will make you pay.
Who Is a Good Fit for This Card?
We believe that the consumer who is a good fit for this card meets the following criteria:
- Good financial habits
- Spends more money than usual on entertainment and eating out
- Low credit scores
If you meet these three criteria, the card will work for you because you’ll most likely pay your bill on time and avoid the penalty APR and you'll maximize your rewards earning.
Along with the advice you’ve read in this review, take a few minutes to read through our comparison of free credit score websites. The reason we mention this is because tracking your credit score is a good habit to adopt if you want to strengthen your financial position.
If you pay your entire balance every month and on-time, you should see your scores rise steadily over the course of a year.