The Citi Strata Elite Card’s Incredible First Year Value: Why It Stands Out

Link: Learn more about the Citi Strata Elite℠ Card

The Citi Strata Elite℠ Card (review) is Citi’s new premium credit card. The card has a massive welcome bonus that makes it worth applying for — many people should be eligible for the product, and it’s a card that I recently picked up. There’s likely a particular interest in this card since Citi ThankYou points can be transferred to American AAdvantage.

As I’ve covered before, the card offers lots of great perks, but it’s not necessarily some “too good to be true” value proposition. In many ways that’s not bad, since “too good to be true” cards tend to be devalued pretty quickly. Along those lines, in this post, I’d like to look at one aspect of the card that is very lucrative, compared to its peers.

The Citi Strata Elite Card’s calendar year advantage

The Citi Strata Elite Card has a $595 annual fee, and offers a variety of perks that can help justify that. These benefits include a $300 annual hotel credit, a $200 annual “Splurge Credit,” a $200 annual Blacklane credit, four annual Admirals Club passes, a Priority Pass membership, and more.

In my opinion, those perks can largely help justify the annual fee, especially as part of larger, overall interest in the Citi ThankYou ecosystem.

But here’s what makes this even more interesting, if you ask me. Nowadays, many card issuers tie benefits to the cardmember year rather than to the calendar year. In other words, the cycle with which you receive many perks is tied to when you pay the annual fee, rather than tied to the calendar year.

That’s an area where this card is an exception:

• The $300 annual hotel credit and $200 annual “Splurge Credit” are both offered once per calendar year
• The $200 annual Blacklane credit is a $100 semi-annual credit (one in January through June, and one in July through December)
• The Admirals Club passes are also issued per calendar year

Why the way this is structured is meaningful

Okay, so… what’s the big deal? Essentially, the way the Citi Strata Elite Card‘s benefits are structured makes the return you get on your first $595 annual fee especially compelling. Assuming your application timing doesn’t exactly coincide with the calendar year, you’ll potentially receive the following with your first annual fee:

• Up to $600 in hotel credits (one for the current calendar year, one for the following calendar year)
• Up to $400 in “Splurge Credits” (one for the current calendar year, one for the following calendar year)
• Up to $300 in Blacklane credits (a $100 credit for the current calendar year, a $200 credit for the following calendar year)
• Up to eight Admirals Club passes (four for the current calendar year, four for the following calendar year)

This matters for a couple of reasons. For one, a lot of people apply for cards as they’re tempted by the big welcome offers, and want to give the card a try, and see if it’s a good fit for them, before committing to it long term. The way the rewards are structured makes the card’s value proposition for the first annual fee particularly lucrative.

Some people might think “well then doesn’t that just reduce the value you get in subsequent years?” Not really, since on an ongoing basis, you’ll still get the typical set of credits with each annual fee. However, you get more value with your first annual fee than you’d otherwise get. If you ask me, that’s a major incentive to at least give the card a try, as it greatly limits the downside.

Admittedly if you keep the card forever, it won’t actually make a material difference, since you’ll get those perks on an ongoing basis regardless. But if you do end up canceling the card (and most people eventually get rid of a card, even if it’s years later), you’ll come out ahead by canceling around the time the annual fee is due. Either way, it’s nice to recoup as much value on an annual fee as soon as possible.

Bottom line

The Citi Strata Elite Card has the potential to be quite a compelling card, especially if you’re looking to earn American AAdvantage miles. One major incentive to apply for the card is that the first year value is particularly strong, given that most of the perks are tied to the calendar year rather than being tied to the cardmember year.

That means that with your first annual fee, you’ll get a bunch of perks that will almost certainly offset the $595 annual fee. It’s another reason to consider picking up the card, in my opinion, on top of the incredible bonus that’s currently available.