Retention Offer for the Citi Platinum / AAdvantage Card

Like many of you, I recently applied for the Citi Executive / AAdvantage World Elite MasterCard, which is still offering 100,000 bonus miles after spending $10,000 in 3 months. However, a few weeks later I got an email notifying me that the annual fee was due on my existing Citi Platinum / AAdvantage Visa Signature.

I have two American Airlines credit cards, and the one I’d just applied for has arguably has better benefits. It’s hard to find a better argument to cancel the old card. While you don’t need a reason to close a credit card, it certainly helps make the process move along and even negotiate for a retention offer to keep the card open. The card company doesn’t like it when you close a card. You shouldn’t like it, either, since it lowers the average age of your accounts. (Open cards keep adding to the average. Closed cards stay young.)

Whenever possible, you should try to get a retention offer rather than close your account. Think of it as a miniature sign-up bonus. Usually there’s a small spending requirement in order to earn a statement credit or extra miles. It makes it much easier for you to hold onto travel rewards cards for their other benefits without paying the fees meant to cover those benefits’ costs.

 

Citi made me a good offer this time, so I’ll share it in case any of you are in a similar predicament. In exchange for paying my $95 annual fee and keeping the Platinum / AAdvantage card, I’ll get a $95 statement credit within the next two billing cycles. Furthermore, I’ll receive 1,000 bonus miles for each of the next 16 billing cycles when I spend $1,000 or more. That means I can put general expenses that don’t ordinarily qualify for any category bonuses on the Platinum / AAdvantage card and get the same 2 miles per dollar (up to the first $1,000 each billing cycle) that I would get for American Airlines purchases. It helps a lot, and the phone rep acknowledged that otherwise I’d probably have a lot of better options for charging my everyday expenses.

As for crediting back the annual fee? Well, I don’t need to pay $95 for things like a free checked bag that I already get with the $450 annual fee on my Executive / AAdvantage card — or for that matter, my Executive Platinum status. So I’m glad the bank saw reason and made me whole. I was actually surprised they didn’t require any minimum spend in the next few months to earn the statement credit.

But by keeping the card I’ll also continue to get a 10% rebate on miles redeemed, up to 10,000 miles rebated each calendar year. That’s something the Platinum / AAdvantage card offers and its higher-priced sibling leaves out. Altogether I stand to earn up to 22,000 extra miles for no additional cost.

We’ll still have to see what happens at next year’s renewal and whether I keep one or both cards or even close both and apply for another. But for those of you who haven’t tried something like this before, I suggest the next time you find an annual fee on your statement that you ask if the card issuer can do anything to make it worth your while. A quick check on FlyerTalk suggests my experience isn’t atypical.

About 

Scott created Hack My Trip while traveling on a budget during graduate school and continues to share his thoughts on better travel. He maintains elite status with American Airlines, Alaska Airlines, Hyatt, and Starwood.
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  • Flyerdad

    Scott: I got the same offer last year and use the card to buy 2 VRs per month. Means I’m buying AA miles for about .40 each–pretty good deal.

  • Chris

    This is a good suggestion but what if you have already a few Citi cards and they will no longer extend you additional credit? I get that you can shift around credit lines but what’s the minimum credit limit they’ll allow for the Platinum and the Executive?

    Some people might need to cancel some cards in order to have new credit limits for new cards

    • Scottrick

      I believe the minimum credit line for a Visa Signature is $5,000.

      My opinion is if you have less than $15,000 in available credit (enough for three cards) and are struggling to get more for additional cards, then it might be wise to lay off new applications for a time and improve your credit history.

      But if faced with a decision between closing a card to get a new one approved and accepting a retention offer, then the new card is likely to earn more miles.

      • Chris

        The credit history is fine. It’s the grad student income that may be an impediment… :)

        • Scottrick

          Ah, yes. I have experience with that… If you’re married you can include your spouse’s income or other income that you can reasonably expect to have available to pay your bills.

  • Elaine

    I am in exactly the same situation and have the CITI bill with annual fee notice on my desk for handling. Very timely; thank you!

  • Danh

    They did not offer me anything for the Visa version but I got the same offer for the Amex version. Plus, the annual fee is $85 instead of $95, so I made $10 extra.

  • Scott C

    “You shouldn’t like it, either, since it lowers the average age of your accounts. (Open cards keep adding to the average. Closed cards stay young.)”

    This is not accurate, at least not for FICO scoring. FICO calculates your average age including open and closed accounts. Once the card falls off your report (usually 10 years after it is closed) it will affect your average age of accounts, but there is no immediate affect to AAoA by closing a card.

    Credit Karma will look at average age of open accounts, which may be the source of the confusion.

    • Scottrick

      I’m aware of differences between FICO and how Credit Karma will measure scores, but this is what I meant:

      If a card is open for one year, then closed, and FICO measures your average account age one years later, then that card still only counts for one year — not two — and it will count as one year until it finally drops off your record. There is no immediate effect because when the card is closed the ages are the same, but in future years the card will still be on your report and will look “young.”

      Are you saying that a card I close after the first year will still look like a 5-year-old card on my credit report four years later, as if I had never closed it? I’m certainly willing to update the post if this is correct.

      • Graydon

        Your AAoA theory in not correct, yes that card will look 5 years old BECAUSE IT IS 5 YEARS OLD. All accounts both open and closed are factored based on the month and year it was opened UNTIL IT FALLS OF YOUR REPORT. It does not matter at time of calculation if it’s open or closed. I am not sure if I can post links here but attached is the seemly AAoA calculator and it works well. I just checked mine to be sure and it indeed is factoring in a card I closed 6 years ago after 1 year open into my average. In fact without those cards I had years ago including the closed ones my AAoA would be taking a huge beating. It’s not, thankfully.

        http://seemly.com/aaoa-calculator/

        And thanks for this post, Wife and I have this card and it’s due to renew in a couple months. We also both got the AA Exec card so were going to close this one but will try for the retention offers. Great post!

        • Scottrick

          Thanks, I already updated the post after your feedback.

    • Scottrick

      Update: Further research suggests you are correct, that open and closed accounts age together. However, FICO will also look at recent use of each account, which would naturally be poor for closed accounts.

  • Amol

    I’m more surprised to see someone NOT get this offer

  • tomg63

    I got an offer for 3,000 miles for $500 in spend before my AF posted. I’m going to call back in a month and see if I can get the $95 waived too.

  • Jon

    Any idea what the typical retention offers are for the Citi Executive card? I imagine there will be tons of people canceling the card in about a year when the annual fee comes due for everyone that took advantage of the 100k offer.

    • Scottrick

      My experience from the United MileagePlus Club card is that there is no retention offer. With those cards that are directly linked to an airport club membership, you’re effectively buying a membership and lots of other benefits on top. Chase was very strict that on that particular card they could provide no retention offer, so I expect Citi might have a similar policy for the Executive card.

  • heavenlyjane

    Both my husband and I got this same offer on each of our cards last week. We were quite pleased. It’s a win-win for both Citi and us.

  • UAPhil

    My last retention offer was a statement credit offsetting the annual fee if I made 5 purchases on the card within 90 days. Hello, Starbucks!! (Of course, since I fly mostly to Europe, AA miles are generally not as useful as UA miles, but this year’s excellent availability of 20,000 mile seats in April and May was a pleasant surprise.)

    • lrafor2

      Currently I have 2 Citi Exec Aadvantage cards, my retention offer was a one time bonus of 5000 miles and $300 statement credit for $1500 spend / month for next 3 months. New to retentions- not sure if I should bother with this or just close acct.

      • Scottrick

        For the Executive / AAdvantage card, that sounds pretty good. Often cards that include airport lounge access have policies against retention offers because you are, in effect, paying for the lounge access and getting a credit card along with it.

        • lrafor2

          Thanks! I don’t know what I will do with double benefits, but in effect they are paying me $50.00 to keep the card, plus the miles… their first offer was a no fee card that offered 1 pt /$2 spend

  • DanCorporate

    Retention offer still good. I just received the same offer. $95 statement credit and 16 months of 1000 bonus miles per month.