Maximize Hotel Redemptions with Two Citi Cards

The Citi Prestige® Card’s most valuable perk in my opinion is the 4th night free benefit. With this benefit you can get a consecutive 4th night hotel stay for free when you book through the Citi Prestige Concierge. With the new changes to the Prestige, you can utilize this perk with cash or points. Being able to use points on this benefit opens up some great possibilities for extra value and here’s why.

Maximizing point value with the 4th night free

When you use ThankYou Points for the 4th night free benefit, the points redeem at one cent per point. So for example, if you were booking 4 nights for $400, you’d get $100 off so your total would be $300. At 1 cent per point, that would require 30,000 ThankYou Points. Pretty simple.

However, as shown by the The Frequent Miler, if you have the Citi ThankYou® Premier Card, that redemption rate bumps up to 1.25 cents per point when your points are pooled, which is the standard redemption rate for travel expenses with the Premier Card. So using the same example, if you were booking 4 nights for $400, you’d get $100 off so your total would be $300. At 1.25 cents per point, that would require 24,000 ThankYou Points.

This is a great deal compared to even the Chase Sapphire Reserve. If you had used the Reserve to book that $400 stay with Ultimate Rewards, you’d need 26,666 Ultimate Rewards. So if you have the Prestige and Premier combo, it’s definitely worth considering using your the Citi Prestige Concierge if you had planned on covering hotel stays with points.

1.67 cents per point?

An issue that’s been debated about this redemption is how to determine the point value. If you’re using 24,000 points for a $400 stay, that’s 1.67 cents per point. However, if you calculate the value based on the $300 rate after applying the 4th night free benefit, that’s 1.25 cents per point.

Some would argue that because the 4th night free benefit applies to both cash and points bookings, you would never pay $400 for that stay as a Prestige holder. Thus, the cash rate should be determined based on the $300 rate. This makes sense and will give you the “truer” cents per point value of your savings.

However, I still like to think of it as a 1.67 cents per point redemption. This is primarily because I now travel wayyy more than I would normally travel because I’m covering almost all of my expenses with points. Therefore, I’m not “saving” any money the majority of the time I’m using points. I’m just experiencing new things for free or nearly free. So focusing on cents per point based on the “true” cash value of a Citi Prestige cardholder doesn’t serve the best purpose for me. Instead, I simply want to use the fewest amount of miles or points for a given redemption.

I’ll illustrate why I prefer looking at this as a 1.67 cents per point redemption  by using that same $400 hotel rate example.

Let’s assume I’m looking to go on a 4-night stay and that this is yet another trip that I’m only taking because I have the points to cover it. In other words, I’m not truly “saving” any money by using points on this trip because I would not have traveled but-for having the points.

So I look at my redemption possibilities.

  • I could spend 53,333 Membership Rewards at .75 cent per point (no thanks)
  • I could spend 26,666 Ultimate Rewards at 1.5 cents per point (much more reasonable)
  • I could spend 24,000 ThankYou Points at 1.67 cents per point (the best deal)

If I had factored in the cash price after applying the 4th night free benefit, I’d be looking at redeeming for 1.25 cents per point with ThankYou Points and that would make it look like less of a bargain than using Ultimate Rewards. But we know that ThankYou Points would be the more optimal redemption currency in this situation since it requires fewer points.

Ultimately, I don’t think it really matters how you slice it — the practical significance of initially determining what type of currency you want to depart with is much more important. In my case, departing with cash isn’t really an option because I’ve reached a point where I’m only traveling because it’s virtually free. At that point, it’s all about using the cheapest redemption methods to cover those costs and by focusing on the 1.67 redemption value, I’m able to better compare my options between award programs.

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