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Funding Citibank Savings Account with Credit Card

February 10, 2016

I Dragged My Feet & Got Burned: Citibank Kills Funding Bank Accounts With A Credit Card

The big news from yesterday was that you can no longer fund a Citibank bank account with a credit card. I have written about this quite extensively in the past as seen here, here, and here. Some of these posts are still among my most viewed posts on a daily basis – especially funding a Citibank Savings Account with a credit card as I think I was among the first bloggers to blog about that specific deal.

Funding Citibank Savings Account

RIP

With all the time I’ve spent on the topic and recommending it others, you’d think I would make sure to maximize this promotion for my wife and I. While it’s true we both got new Citigold Checking accounts and I got my own Savings Plus account in the past year, I never got around to setting up a Citibank Savings Plus account for my wife. There was no good reason to delay it other than the thought I’ll get around to it next weekend (or the weekend after that) as I (stupidly) thought this “deal” would always be available. I ended up dragging my feet on this and with a newly increased credit line on my Citi Prestige, I could have funded this account up to $25,000. My procrastination is going to cost me at least $400 (based on 1.6 cents a point in value) for at most 10 minutes or so of work. 

I imagine someone will make this argument in the comment section so I’ll head it off now but no, I do not think I killed this deal. My traffic is nowhere near the levels of Million Mile Secrets and other big blogs who posted about this deal in the same level of detail. Their daily traffic levels are over 10x what I receive so I refuse to believe it was my post that killed this deal for anyone.

Over the past year or so, I’m sure Citibank saw a huge increase in both 1) the number of accounts funded with a credit card and 2) accounts closed shortly after opening. It is probably the second point that killed this deal as Citibank was losing on the credit card processing fees but hoped to recoup that customer acquisition cost by having new, long term Citibank customers. I’m quite confident that many of us in this game opened the account with a credit card and then closed it within 6 months to a year – thereby making this quite expensive for Citibank (especially if you opened a Citigold account under the 30,000 to 50,000 American AAdvantage or Thank You point offers).

I want my readers to takeway the following from this post. Within the past year, we have seen many of the easy routes for free and/or cheap manufactured spend disappear, often with no warning like this. The game keeps evolving & combined with the devaluation of frequent flier / hotel loyalty programs things have certainly gotten tougher for many travel hackers as compared to 12 months ago. Please take my advice and don’t procrastinate when a valuable deal is staring you in the face – jump on it and take advantage while the proverbial “iron is still hot”. Additionally, always have backup plan – whether it is to simply to meet a minimum spend requirement or liquidate Visa prepaid gift cards.

Now as Jay Z says, On To The Next One

 

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Citibank Funding Citibank Account with Credit Card, Funding Citibank Savings Account with Credit Card 3 Comments
November 12, 2015

My Experience Funding a New Citibank Savings Plus Account With a Credit Card

Earlier this year, I detailed my experience opening a Citigold checking account to earn American Airlines miles and how I was able to fund it successfully with a credit card. Once the miles had posted for opening the Citigold account, I downgraded the account to a Basic Checking account which I have kept open with the minimum amount ($1,500) in it to avoid any monthly service fees. I realized I never opened a savings account with Citibank when I opened that checking account so last week I opened a Savings Plus account for the sole reason to fund it with a credit card to earn points. Spoiler alert – I was successful but here is a recap of the various steps I took and important details you need to know.

While there are various ways to apply for this account, I chose to apply online as this was the quickest and most convenient method for me. On the Citibank Savings Plus account information page, it clearly lists the ability to use a credit card to fund the account which alleviates any concern about using a credit card.

Well don't mind if I do use a credit card...

Well don’t mind if I do…

After clicking the Apply Online button, you will see a screen asking you to choose which kind of Savings Plus account package you want (Citigold, Basic etc..). Since I had a Basic checking account now, I obviously just chose the Basic Banking Package (even though it’s called a package, I was only opening a Savings account). After filling out all the required information, you will eventually get to a point where you will be asked how you want to fund your account. The following is important as only the initial funding can be done via credit card and you don’t want to mess this up!

  • Decline any offer to fund the account with a Citibank checking account or any other account you may have with another bank.
    • Note: You actually can’t fund a Citibank account with a credit card online. Unlike when I opened my checking account, I was not given option to print a form to fax in my credit card information to fund the account so I would have to call in to fund it.
  • It is advisable to wait a day to call in to fund the account as reps can’t initially process funding on the account.
  • In the meantime, decide which credit card to use and set the cash advance limit to zero. Doctor of Credit maintains an excellent list of which cards will post this as a purchase vs. a cash advance. It might also be helpful to call your bank and inform them of a large purchase but I did not do this.
    • I would choose either a Citibank or Barclays credit card as I haven’t read many reports of those cards posting as cash advances. I personally used my Citi Prestige. Citibank won’t accept American Express so no Amex cards will work.
    • DO NOT USE a Chase card under any circumstance as this will almost always post as a cash advance.
  • Once you’ve waited a day call New Accounts at 1-800-745-1534.
    • Protip: They are only open Monday to Friday from 9am EST to 6pm EST.
  • Tell the rep you opened a Savings Account yesterday and you would like to initially fund it with a credit card. My rep noted the funding would be processed as a purchase but did warn me some banks will still treat this as a cash advance and I would be responsible for any fees.
  • After providing my card information, my rep stated the account would be funded in a few days and in the event something went wrong, I would receive an email notifying me of the issue.

Sure enough, I checked two days later and I saw a $14,500 charge on my Citi Prestige AND $14,500 in my new Savings Account. Success!

Funding Citibank Savings Account

Coded as a Purchase on my Citi Prestige


SavingsAccount

Credit Card Deposit in my Savings Account

I didn’t list it above but the only fees associated with this Savings Account is a $4.50 monthly charge if your average daily balance is less than $500. I didn’t see anything about early termination fees if you wanted to close the account right away but I personally would not do that and jeopardize your relationship with Citibank. My plan is to keep $500 in the account for a few months and close it sometime next year.

Even though I didn’t receive any signup bonus for opening this account (unlike the current Citigold offers for 50,000 ThankYou Points or 50,000 American Airlines Miles), I still think this is a worthwhile endeavor especially if you already have a checking account with Citibank from a previous offer. Opening a savings account allows you another easy opportunity to fund a bank account with a credit card for a large amount – your credit line is the only constraint! For maybe 20 minutes or so of work, I earned 14,500 Citi Thank You Points. If I redeem those points at a rate of 1.6 cents per point for AA flights, that’s worth $232 in free flights!

With how easy this is, anyone else going to try this?

Bank Accounts, Citibank Funding Citibank Savings Account with Credit Card, Opening Citibank Account with Credit Card 19 Comments

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