[Update 11/2/2012] We have learned that the one extra point you earn on everything with this offer is counted as "bonus points" not "base points" and only base points will be matched with flight points. So assuming you have enough flight points, this card essentially returns 3 points per dollar spent, and if you redeem ThankYou points for airfare, your return rate is exactly 4%, not 5.32% as previously stated in the original post.
For example, if you annual spending on the card is $25,000, you will earn 25K base points, 25K bonus points through this offer. Assuming you purchase several tickets and fly a total 25,000 miles, you also earn 25K flight points. Thus the total ThankYou Points you have will be 75K, which when redeemed for airfare, will equal $1,000 = 4% of $25,000.
[Original Post 9/27/2012] Citi ThankYou Premier is one of our favorite cards. The normal signup offer is 25,000 points ($125 annual fee), however, there are two special offers with the 1st annual fee waived currently available: 60,000 points (1st year free and 2nd year $125) and 50,000 points (1st year free, may apply both Visa and MasterCard to get 100K). Now Citi is pushing out a third special offer: 2 points on every purchase for 24 months and the 1st year annual fee $125 is waived. This offer, while not having a signup bonus, is actually very attractive to people who want a card to put most of purchases on and don't want to deal with airline miles or hotel points.
Note that if you redeem ThankYou points earned from this card for airfare through Citi, you will get 33% more value, i.e., 1 point = 1.33 cent and this card will return 2.66% on everything for two years, which beats our cash back benchmark FIA Fidelity Amex. What is more, if you use the card to purchase airfare you get "flight points" based on the miles you travel. Say you purchase a round-trip $500 transcontinental ticket and the trip is 5,000 miles , you will get 1,000 "purchase points" and 5,000 "flight points". Technically, if you have enough flights points to match all your purchase points, you have a potential to get a whooping 5.32% return on everything. Not many people can actually achieve this ultimate best return, but here an example will illustrate how to. Say your annual total spending on this card is $25K, then your total purchase points will be 50K under this special offer. If you purchase a couple of tickets and fly a total 50,000 miles, you will also be awarded 50K flight points. Your total ThankYou points will then be 100K, which when redeemed for airfare, will equal $1,333 = 5.32% of $25K.
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