Citi DC 2.5% Cash Back Offer!

[Anonymous]

Just received a (targetted) mail offer from Citi. I have held their Citi DC card for quite some time. The offer entailed opening 2 accounts to get 2.5% cash back on my Citi DC!
 
If, before June 30th, I open a Citi High-Yield Savings and Priority Checking, I will receive 1.5% for each purchase + 1% for paying the bill on my Citi DC. Only downside is, if you have less than $50,000 with Citi, there is a $30 monthly fee for the Priority Checking account.
 
This is the link for the offer, but in the terms, they claim if you weren't targetted, you can't get the deal, but you can still take a look for yourself:
http://citi.com/BetterTogetherCash
 

For me, they offered 1.5 years of 2.5% cash back, expiring in January of 2021!

[AverageJoesCredit]

Lol id rather have $50k than a 2 or 2.5% cc

[Anonymous]

Ha! For real! 😂 

[Revelate]

Well the question is what the 50k can be dropped in.

BOFA / Chase / et al. are now looking at total assets on deposit, not necessarily in a checking or savings account. If Citi has an investment vehicle like Merrill Edge or YouInvest 2.5% might be attractive to some.

Heck I was looking at a .5% arbitrage play recently, if I could make that a 1% arbitrage play and if I could get that by tying up cash doing something I would be doing anyway (vis a vis Chase Sapphire Banking leveraging YouInvest) it isn’t a terrible offer.

[Anonymous]

Very poor 'offer' IMHO, but perfectly aligns with what 'citi' is known to do (such as their recent prestige card 'enhancements').

You need to spend well over $200,000 (depending on tax rate) on the DC card in 1.5 years to dig yourself out of the hole of missed interest from $50000 passively staying in a 2.5% APY account.

It's actually better to simply pay the $30 fee, as in that way you only need to spend a bit over $100,000 on the DC card during the same period to break even.

Now if you are like a typical person who doesn't spend hundreds of thousands on a 'no category bonus' card like the DC, even if we (somehow) simply ignore the missed interest, this is still one of the worst bank account bonus around.

For example, if you spend $30000 on the card for the 1.5 years, you get only $150 from additional cashback from the 0.5%. But you tie up $50000 for 1.5 years and you have to open both checking and saving and keep them open for 1.5 years.

A typical bank account bonus nowadays (such as the chase combo one) that requires both saving and checking accounts for only 90 days and only tie up $15000 for the same period will instead give you a bonus $600. This $600 is taxable, but a typical person probably doesn't have a 75% tax rate, not to mention this one only tie up less than 1/3 of the amount for less than 1/6 of the time when compared against citi's $150 'bonus'.