Citi Dividend Platinum vs. Chase Freedom: Which Is Better?

Some of you may not like the idea of trying out a new credit card with an annual fee and possibly having to cancel the card later (even if comes with a big sign-up bonus!), though the effect on your credit score is a lot less than many media articles would lead you to believe. Here are a couple of cards with $100 sign-up bonuses and minimal requirements (indeed, they would have been rock stars in 2008 and 2009) – but are also everyday “keeper” cards with no annual fee. I’ve had both of them for years.

Chase Freedom ImageChase Freedom® – $200 Bonus

  • For a limited time, earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening
  • Earn a $25 Bonus after you add your first authorized user and make a purchase within this same 3-month period
  • 0% Intro APR for 15 months on purchases and balance transfers. After the intro period, a variable APR of 13.99-22.99%
  • 5% Cash Back on up to $1,500 in combined purchases between October 1 – December 31, 2014 at Amazon.com, Zappos.com and select department stores
  • You’ll enjoy new 5% categories every 3 months like gas stations, restaurants and Amazon.com. It’s free and easy to activate your bonus each quarter!
  • Unlimited 1% Cash Back on all other purchases
  • No annual fee and rewards never expire

Citi Dividend Platinum Select Visa CardCiti® Dividend Platinum Select® Visa® Card

  • Earn $100 cash back after $500 in purchases within the first 3 months of account opening
  • Earn 5% cash back every quarter in must-have categories.  Right now, on eligible purchases within the Hilton Portfolio, car rental agencies, movie theaters and theme parks from 7/1/14 – 9/30/14.
  • Enrollment each quarter is quick and easy
  • Earn 1% cash back on all other purchases.
  • The total cash back earned with the card is $300 per calendar year, excluding the $100 cash back with this offer.  See Citi Dividend Card Reward Program Information.
  • 0% Intro APR on Purchases and Balance Transfers for 12 months. After that, the APR will be 12.99%-22.99% variable based on your creditworthiness*
  • No Annual Fee*

Chase Freedom Banner

Which one is better?
Both offer a $100 bonus after spending $500 on the card for anything (40% back). Both offer 5% back on select categories, and the good thing is you can benefit from having both cards since their categories often don’t overlap. Both require you to “activate” the 5% online each quarter, which is a bit annoying but only takes a minute. Both cap their rewards at similar levels (5% of $1,500 is $75 per quarter = $300 per year). Both have no tiers on their 1% back on everything else. The Chase Freedom has no expiration of rewards as long as the account is open, whereas the Citi Dividend rewards do not expire as long as you have activity once every 12 months. Last I checked, the minimum redemption amount was $20 for Chase, $50 for Citi. Overall, they are both very similar in my opinion.

However… in my credit card survey a few weeks ago with over 3,000 reader responses, there was an open-ended question asking which card was the “best credit card on the market today”. The #1 most popular answer was the Chase Freedom card, beating out everyone including travel cards. Where was the Citi® Dividend Platinum Select® Visa® Card? Not even in the top 20. The people have spoken, but I’m really not sure why! Better commercials?

“Disclaimer: This content is not provided or commissioned by the issuer. Opinions expressed here are author’s alone, not those of the issuer, and have not been reviewed, approved or otherwise endorsed by the issuer. This site may be compensated through the issuer’s Affiliate Program.  “The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.”

Comments

  1. One thing I like about chase is that their redemption is fairly simply. Get enough points, and they mail you a check. With citi you have to deal with the thank you network, where getting a check costs considerably more points.

  2. David, this Citibank card is not a Thank You card. It’s one point per cent and all you have to do is go online and click a button to get your check. It’s just as hassle-free as Chase Freedom.

    I have both cards. My strategy this year is to use the Citicard for the 5% bonus areas only, since all rewards cash is capped annually. Most people arent likely to hit this maximum, since it would mean charging $6000 in bonus categories and up to $30,000 in non-bonus categories.

    However, the card does allow hoardiing in bonus categories each quarter. As you noted, there is no cap on quarterly 5% earnings. My recent pre-insurance dental bill was almost $500 and I moved all my utility bills to this card. With the Citicard, I’m getting 5% back and not bumping up against any quarterly limit.

    For me, it’s not a question of which one is better. Rather, they complement each other. With no annual fees for either card, why choose?

  3. Are these actually cash back, or just “points”? I don’t think either is credited to your monthly statement.

  4. Or, if you don’t want to track categories which of course the credit card companies rotate to obfuscate the true rate you would get on all purchases, just sign up for the CapitalOne CashBack Rewards Visa card. 1.5% on everything. Life is too short to track rotating categories.

  5. With Chase Freedom you can choose to have the amount credited to your monthly statement.

  6. Citi has “Foreign Transaction Fees” (3% when you fill your Skype account for example, as is apparently a foreign transaction – LUX). Chase never had that for me but maybe I didn’t tried enough.

  7. If you are a chase checking account holder you also can get additional points back on the chase freedom card after you’ve had the card for a bit – 10 points per POS purchase + 10% additional points (similar to the 7% dividend on sapphire cards, but instant). If you’re using the card for small purchases like meals every day, that per purchase bonus adds up.

    Also, if you or your family has other cards like the sapphire that use ultimate rewards you can combine points on the cards, which is pretty awesome if you want to use the airline features of one card but the rewards rates of another.

  8. @steve: they are points, but you can chose to credit them to your account. On Chase you can redeem to the penny now once you are over 2000 points, to your statement, chase bank account, or check. It’s good, because when you go to redeem there might be other offers on redeeming points for gift cards and such that are actually a better deal if it’s relevant to you.

    It’s referred to as cash back, because at a minimum you can get that level of cash back from the rewards, but you have the choice to use it otherwise if you want.

  9. I just noticed one other thing – it looks like the $300 limit on the Citi dividend is for all purchases other than those through Citi’s online mall. Chase’s $75/quarter limit is only on the 5% offers, the base points you earn are unlimited.

  10. Sorry, I guess you did state that in the specs, I just read it differently in the text. ;)

  11. The blue card looks cooler…

  12. I actually have both (thanks to the signup bonuses) and while they seem silimar on paper, I find the Freedom has far better redemption options than the dividend.

    Chase UR points been really good for me. Chase gives any amount of $20 or more down to the cent, plus with events like the 25% off best buy, or being able to transfer the points via a sapphire prefferred, you can get even better deals.

    Compare this versus the option to only get checks in $50 increments. Plus the balance doesn’t combine with the rest of my citi cards, which are on the thankyou point system.

    Though Citi does have the ability to get your full yearly max bonus in any one quater, which makes it an excellent card this first quarter (medical expenses and utilities), but after having used up the full amount that means it’s getting tucked away for the rest of the year.

  13. @dev: thanks for pointing out the better deals on gift cards available through the Chase program – I’d just assumed none of their offers would provide more value than just cash back, but now I see several gift card options (including Amazon, Kohl,s, Macy’s) that give you $25 value for $22.50 in points. If you often shop at these places, you’re effectively increasing your cash back by another 11%!

    Regarding the additional points for Chase checking customers: I recently looked over my last several months of activity, and the bonus points effectively provided an additional 0.23% cash back. So I’m getting 1.23% cash back on all purchases – or 1.37% if I use it all on discounted gift cards – and that’s before considering the additional 4% on rotating categories. And that (along with the easy redemption) is why I voted for the Freedom card.

  14. Sam Johnstone says:

    For me the points not expiring on Chase Freedom makes a *huge* difference. I spend lengthy periods overseas for my job, in places where these credit cards are not accepted, and I don’t want to worry about my points expiring while I’m gone.

  15. People like the freedom card because they aren’t aware of the better cards like citi forward. It’s like the ipod of credit cards.

  16. subscribing

  17. @brent212 What’s makes the citi forward card that much better? I’m one that wasn’t aware of it..

  18. It gives 5% back at restaurants and amazon.com. All year round. With these rotating categories cards, sure you get useful benefits (I mainly consider gas, groceries, and restaurants to be “useful”) for 3 to 6 months a year, but the card is pretty much worthless, at least to me, for 6-9 months. And on top of it, I have to pay attention to when the categories are switching…

    Just my opinion, but I’m not a fan of the category concept. I use an amex simplycash for 3% on gas, my forward card for 5% at restaurants and amazon, and a amex blue for 3% on groceries and 1% on everything else. If one of the rotating categories cards gives 5% on gas or groceries, I’ll use it if I can remember, but sometimes I don’t (I didn’t realize freedom had switched to gas at the start of the year, for instance).

    Now that I think about it, the citi forward might not even be available anymore (at least with the same benefits that mine has), as I picked it up probably 2-3 years ago. Seems like 5% back for restaurants, gas, or groceries is hard to come by these days, unless it’s through something like the freedom card.

  19. Alexander O says:

    Chase Freedom is better, because 1% is not capped, whereas citi’s card is capped at $300 and you wont get a dollar more, weither its bonus category or regular purchase.

  20. The Citi Forward is only really worth it if you are looking to have several cards and/or eat out a *lot*, since the main reward is restaurants. If you are just looking for a couple cards you’ll get better return from the cards above.

    As far as rewards use goes to, I’ve used both Ultimate Rewards and Thank You rewards (which the Forward card uses), and I like UR a lot better. They tend to have better and more consistent deals both for purchases and redemption, and they allow cash redemption to the penny, at a one penny/point rate. Thank you’s cash return is horrible (currently 8000 points for $50), meaning the only way to get the to actually turn 5 points into 5% is with gift cards, sometimes only at the $100 level. There was a whole year where I couldn’t even get a gift card I could use at 1penny/point, until amazon was added. Compare that to UR where you get a proper return on cash and sometimes even better rates on cards, plus frequent 10% promos with major stores like Sears. I only kept my Thank You Rewards card because it’s my oldest, but now that it’s been long enough with my second card I plan on jumping ship and not looking back.

  21. Looking into it a bit further I see the reason the Citi Forward gets you 5 points from amazon is because it reports itself on credit charges as a bookstore – that’s subject to change and there’s a couple small rumors that it will, but in the meantime you’re right that it could be a good option for amazon shoppers. Personally I don’t shop at amazon near enough for it to be worth the hassle of the thank you program.

  22. I eat out a lot, so the forward is incredibly productive for me. At least one meal a day. This morning I had breakfast with a group of people, and when the bill came and everyone threw in cash, I took it and put the whole ~$120 on my card. There’s 6 bucks in my pocket.

    Not sure what the $300 cap is. I’ve never reached any sort of limit where the rewards changed, so maybe I don’t use it enough to see that.

  23. While actual cash back is definitely better, I get CVS gift cards from the thank you rewards site, at 1 penny/point, and that’s essentially identical to cash for me, since there’s a CVS by my house and I go there regularly.

  24. Thanks for the details Brent, I’m going to look into what exactly the Citi card is looking like now!

  25. @brent212 The $300 limit people are referring to is for the Dividend card above, not the Forward

  26. Newlyfrugal says:

    Brent212, how are you getting $1 for 1 point at Citi Forward? I have the card and checked out the thank you rewards site. For $25 gift card to CVS, I must pay with 3,500 points. Are you doing something differently from me?

    Like you, I use Citi Fwd for all dining to get 5% year round. For other purchases, Chase is preferable. I can cash out anytime beginning at $20 and in any increments after $20 (ex: $20.07, $21.15, etc.) I can deposit directly into my Chase bank account (takes one or two days.)

    Because my Chase Freedom Visa is linked to my Chase checking account, I get extra benefits beyond the 5% rotating categories. These benefits include 10 points per transaction and 10% bonus on points earned per cycle.

    Some gift cards offered by Chase ultimate rewards give better than 1:1 ratio of points to cash.

    Additionally, as mentioned by another poster, I can transfer points online between Chase accounts (my own or family’s accounts) to maximize my cashback. None of these benefits are offered by my Citi Fwd or any of my citicards.

  27. Hmmm. I just checked on thankyou.com, and without even logging in, searched for cvs, and the options that came up were 2500 points for $25, $5000 points for $50, and $10000 points for $100.

  28. Thought I’d jump in here real quick. First, ThankYou network has a quirk where not all cards get the same redemption rates on gift cards. If your *only* card is the Citi Forward, then you get slightly worse redemption rates. If you have any Citi card linked to your ThankYou account number that is a “premium” card, then you get the normal “good” redemption rates (at least $100 gift card = 10,000 points). I honestly don’t know what card is what, but I think the new ThankYou cards count as premium since that is what I have.

    More info in this Citi Forward post and comments:

    http://www.mymoneyblog.com/citi-forward-card-review-bonus-amazon.html

    ThankYou network also has sales from time to time, so that you can get better than $1:100 points on your redemptions. I think Ultimate Rewards does the same as well, and recently had a sale for Freedom card users.

  29. Newlyfrugal says:

    Brent212 and Jonathan: thank you so much for clarifying for me. I never knew that I could get 1:1 ratio of points to cash with Citi Forward.

    I will take Jonathan’s advice and apply for another Citicard linked to Thankyou rewards so I can get 1:1 ratio for my Citi Forward. I appreciate both of your input!

  30. Citi Dividend spam you with all sorts of useless offers, both snailmail and online when you simply just want to log in and pay the bill electronically. They interlace “advertisements” between transactions records in their online bills. They also send out “blank checks” for balance transfers/cash withdraw which I see as a security risk. I do not see anyway to opt-out of these annoying Citi advertising tactics.

    The Citi dividend cash at $50 increments is also annoying, the extra points just sits there until you spend close to another $5000 at 1% to get the next “check”. I have both Chase Freedom and Citi and going to cancel my Citi card. Chase Freedom cash-back is more flexible, can cash out easily (Chase Ultimate Rewards is pretty awesome, I traded the points for Amazon Gift cards at 10% off instead of cash back), and their website is far more user friendly and does not spam you with junk.

  31. Not that it matters since we’re all into saving money, but the Chase Freedom card is the ugliest designed card I’ve ever owned.

  32. The Chase Freedom is better simply because of the number of ways you can redeem. Citi can be redeemed only for cash and that too in 50$ increments. In Chase, you can get cash or redeem points in their Ultimate Mall or get statement credits. The best thing about statement credit is you can have any fraction amount. For example you can get statement credit of $21.34 whereas in Citi you get only cash as 50, 100, 150 and so on…So with Chase you feel you dont loose even a penny and dont have to wait for redeeming.

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