In the crowded credit card marketplace, issuers are increasingly offering flexible rewards programs that let cardholders choose how they earn points and miles. One interesting example is the Citi Custom Cash Card, which provides an automatic 5% cash back on up to $500 in monthly purchases in your highest eligible spending category. In this guide, we’ll explore the key features of Citi Custom Cash and how its flexible rewards structure can be an excellent choice for many spenders.
Customizing Your Rewards
What’s unique about the Citi Custom Cash is that it allows cardholders to choose one eligible spending category each billing cycle where they will earn 5% cash back on up to $500 in purchases. Eligible categories include gas stations, grocery stores, restaurants, home improvement/furnishings stores, and many more.
After your initial category selection, Citi will automatically track purchases posted within that merchant category code and reward 5% cash back on the first $500 each billing cycle. Anything above $500 reverts to a standard 1% earnings rate.
This approach offers more flexibility than traditional cards that only earn higher on preset categories. With Citi Custom Cash, you can optimize rewards by selecting your top spend category each month based on recurring bills or planned purchases.
Earning Potential
Let’s look at some spending scenarios to demonstrate the potential earnings:
- Gas spending of $400 per month would yield $20 cashback (5% on the first $500, then 1% thereafter).
- $600 in monthly groceries gets $30 back at 5% on the first $500 grocery spend.
- Dining out $250 per month earns $12.50 at 5% but only on the portion under $500.
Over a year, a user who maxes out the $500 monthly bonus could earn over $600 in cash back depending on their category selection – much higher than standard 1-2% cash back rates. Even sporadic bonus category users still come out ahead versus flat-rate cards.
Additional Rewards Rates
In addition to the flexible 5% category, cardholders also earn:
- 1% cash back on all other purchases not within the selected category.
- 5% cash back on travel purchased through Citi’s travel portal, up to the first $500 per month in combined travel purchases and cash back category spend.
This effectively provides a secondary 5% bonus on travel for users who spend close to the $500 limit each month across categories.
Redeeming Cash Back
Citi offers solid redemption options for Custom Cash rewards:
- Cash is deposited into an eligible bank account as a statement credit.
- Gift cards for brands like Amazon and Target in $25 denominations.
- Pay down existing Citi credit card balances in any amount.
There are no minimum redemption thresholds, so even small reward balances can be cashed in. Cash back never expires either as long as the card remains open. Award orders are processed within 1-2 billing cycles.
Additional Benefits
Beyond the headline 5% cash back feature, cardholders receive:
- 0% APR on balance transfers made in the first 15 months (then 13.99%-23.99% variable). Useful for managing existing high rates.
- Cell phone protection covers up to $600 per claim if paying monthly bills with the card.
- No annual fee ensures long-term value without commitment costs cutting into earnings.
While not travel-focused like premium cards, these perks add to the flexibility and usability of the Citi Custom Cash for both regular spending and occasional financial management needs.
Customizing Bonus Categories
Each month, cardholders can modify their 5% earnings category by logging into their Citi account before the statement closes:
- Select from targetable options like gas, grocery stores, restaurants, home improvement etc.
- Change is effective on purchases posting in the new category for that billing cycle.
- Can toggle categories yearly, monthly, or even between billing periods depending on planned expenses.
This flexibility means optimizing rewards for seasonally rotating costs like back-to-school shopping, holidays or home renovations done in phases over several months. Changes only impact ongoing and future spending – past activity stays under original categories.
Strong for Consistent Spenders
While the Citi Custom Cash works for any spending level, its structure truly maximizes rewards for customers with consistent monthly costs they can reliably trigger the 5% bonus on the:
- Daily commuters fill gas tanks biweekly.
- Families with regular weekly grocery/pharmacy/wholesale club expenses.
- Individuals who put most dining/entertainment purchases on their cards.
By selecting just one heavy spending category each month, users can essentially earn an elevated 5% cash back rate on a majority of their budget items – much higher than flat 1-2% rates on competitor cards.
The best use case is designating a category for regularly recurring bills that consistently hit near or over the $500 monthly bonus cap. This provides very reliable extra earnings versus just random bonus categories on other cards.
Downsides to Consider
Like any product, the Citi Custom Cash does have some potential downsides:
- Soft credit pulls for limit increases may affect credit scores for some users over time.
- $500 monthly bonus cap means missing out on higher rates for spending over the limit amount.
- Limited bonus categories don’t benefit infrequent spenders or those with diverse bills.
- No sign-up bonus is uncommon among new cash-back cards.
However, its flexible bonus category complements the spending habits of many individuals and household budget managers. Overall, the pros of its reward structure may well outweigh the minor negative tradeoffs for optimal users.
Is the Citi Custom Cash Right for You?
In determining if this is the best cash-back credit card to suit your needs, consider these factors:
- If you consistently spend $500+ per month on one or two categories like gas, groceries, dining, etc.
- Want to maximize rewards without limiting spending categories to quarterly or annually?
- Prefer a simple cash-back rewards structure without travel redemption complexities.
- Don’t mind shifting bonus categories monthly based on planned larger expenses.
- Value cash back flexibility over sign-up bonuses or premium travel perks.
The Citi Custom Cash was designed for customers who maintain steady monthly balances in one or two key spending categories. Those willing to optimize rewards by selecting their top category each billing cycle get unmatched earning potential at 5% cash back on the first $500 spent. Overall it’s an excellent flexible option for consistent spenders seeking strong rewards on their regular budget items.