October 2, 2016

What is the Best Value in a Hotel Club Rewards Credit Card?

Recently The Simple Dollar discussed Guaranteed Getaway: Credit Cards That Offer a Free Hotel Stay Each Year    In that they listed 4 different rewards cards for hotels chains.  
Citi Hilton HHonors Reserve Card,
Marriott Rewards Premier Credit Card,
Club Carlson Premier Rewards Visa Signature Card, and
IHG Rewards Club Select Credit Card

(hey if you want to sign up for any of these cars follow the link to The Simple Dollar article and use their links, that way TSD will get a commission,  I get NO commissions myself )

I've got the IHG card already and its a good card.   In addition to earning over 50k points with IHG during my sign up, I also get a free hotel room every year for the $49 annual card fee.     To figure what card is a good value you have to look at the rewards given, the points cost of hotel stays and the costs of the card.   

Here is my break down of the value for all 4 cards : 

annual fee
$75 $85 $75 $49
Sign up
2 nights
80,000 85,000 60,000
$2,500 $3,500 $2,500 $1,000
bonus value
$175 $445 $330 $430
1 night
1 night
1 night
Spend an
$10,000 $0 $0 $0
points /$
3 1 5 2
pts /night
20,000 20,000 28,000 20,000
annual value
 $      100
 $         65
 $     139
 $     101
pt value
2.3% 0.8% 2.7% 1.5%

NOTE :   This is based on some assumptions in nature of hotel, cost of hotel rooms and YMMV.

To explain all the parts of that table see below:

annual fee:  You have to pay for these cards.  IHG waives the annual fee the first year but the others dont.
sign up :   When you sign up the cars give you a bonus.   Hilton gives you 2 free nights but the others give a pile of points.
spend for sign up:   This is the amount you have to spend to get the sign up points.  
bonus value:   This is what I figure the cost of your bonus sign up is in total.   I include the cost of hotel rooms at the standard pts/night rate and value a night stay at $150.    I subtract the annual fee and the amount you'd get if instead receiving 2% cash back on the amount spent to qualify for the bonus.
Annual : This is your annual reward for the card.   Most give you a free night stay and Carlson gives 40,000 points.   The HHonors card requires you to spend $10,000 to get the free night.  
Status:   The cards ensure an elite status level varying from silver to platinum.
points / $ :  this is how many points you earn on normal purchases.   For IHG you get 2 points for gas, restaurant and grocery which is easy to get
pts/night:   This is now many points it costs to get what I consider a standard hotel room in a reasonable location.   Its actually the amount of points I'd have to spend for a night in places I'd want to go.  YMMV on this cost since you might spend less staying in a cheap area or more in some place like London or NYC.
annual value:  This is the value in keeping the card if you value your free night less the anual fee
pt value :   this is what I'd consider the dollar value return on points earned if used towards hotel rooms at a average $150 cost.

Overall I think the Marriott and IHG cards are the best total value and IHG is the overall winner in my book.  

Your own value will depend on how you might use the rewards.    You should check what it costs in points for specific hotels you'd be likely to book and compare to the $ cost of those hotels.   Personally I wouldn't get much out of the Carlson card because they don't have a lot of hotels in places I'd routinely visit.    All the cards have good ongoing value if you use the free night.   The Hilton card does require you to spend $10,000 a year for the free night so thats a hefty obligation, but if you do you get good points and return on it.


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