Edit: For those wondering about Citibank issuing a 1099 for the value of the miles, I thought Citibank stopped issuing them in 2013. Maybe others in the comments can verify?

I’ve seen this offer come and go with some regularity but I just got an email with the latest code for this offer, so I thought I would share it. Depending on the level of checking account you open with Citibank, they will award you anywhere from 5,000 to 30,000 American Airlines AAdvantage miles if you use their debit card and meet the bill pay requirements, which are very reasonable. Here is the offer below:

In order to signup, you must use code DTTEZS60ML. Per Citibank, here are the additional requirements:

1. Open a new Regular Checking account in an eligible account package by 12/31/2014.

2. Within 60 days after account opening, complete both of the
following qualifying activities:
• Spend the required minimum amount on purchases using your Citibank® Debit Card* AND

• One qualifying bill payment from the new checking account for 2 consecutive calendar months

3. The miles will be posted within 90 days from the statement close date of the month that all the qualifying activity is met. This will be important (read below).

Now obviously the highest offer is for the Citigold but that account also comes with the highest banking fees. Here is a quick analysis of the fees per type of checking account.

• Citigold Account (30,000 AA Miles) – $30 per month fee. The fee is waived if you carry a balance of $50,000 in deposit or retirement accounts OR  if you carry  a balance of $100,000 including deposit, retirement and investment accounts OR if you carry a balance of $250,000 including your first mortgage with Citibank. After January 1st however, the fee is waived if the balances in ONLY your checking and linked savings account are at least $50,000.
• Citibank Account (15,000 AA Miles) – $20 per month fee (increases to $25 after January 1st). The fee is waived if you carry a balance of $15,000 across all deposit, retirement and investment accounts. After January 1st however, the fee is waived if the balances in ONLY your checking and linked savings account are at least $10,000 (I think is actually good news).
• Basic Account (5,000 AA Miles) – $10 per month fee (increases to $12 after December 17th). The fee is waived if you link up a direct deposit and make one bill pay a month OR carry a balance of $1,500 across all deposit accounts.

Assuming you can’t meet the requirements of a Citigold account to get the fees waived what account should you signup for to take advantage of this promotion? The easy answer is the Citibank account which has a much lower requirement to get the fee waived and would entice me to move any excess money I might have that isn’t currently tied up in other investments over to Citibank. To me, the Citibank offer is worth $225 (I value AA miles at 1.5 cents each) since I would be able to shift around some money to get the monthly fee waived.

A more interesting approach to take is to signup for the Citigold account even if you can’t meet the monthly fee waived. Citibank states the miles should be awarded within 90 days of the month the qualifying activity posts so at minimum it will take 2 months (since you need 2 months of bill pay) plus up to 3 additional months though it could definitely happen sooner. My thinking is the AA miles are worth $450 to me so even if I have to pay 5 monthly fees of $30, I still net $300 on this offer. And I would be willing to bet the miles get posted in month 3 or 4 instead, so I could potentially only pay $90-$120 instead of $150 in fees.

Once the miles post, I would call Citi and ask to downgrade to the account in which I could safely meet the requirement to get any fees waived. There is nothing in the fine print that states how long an account has to be open so I interpret this that once the miles post, they will not be taken back if I downgrade or even close the account. This option returns the most value to me based on my valuation of AA miles.

If I couldn’t get the fee waived on any account (or even if I could get them waived on the Basic account), I would still signup for the Citigold account over the Citibank or Basic account. If you can get the fees waived on the Citibank account, the spread is much closer ($300 in value vs $225) so if you value the convenience of not having to close or downgrade your account later on, maybe going with the Citibank account is right for you. I really don’t see the purpose of the going with the Basic account as the bonus is quite small ($75) and not worth the effort for me to even setup the account and meet the requirements.

What account are you signing up for?