6 reasons to consider hotel rewards cards

Airline cards get a lot of hype. After all, flying across the globe for free makes a great story. But the other sibling in the travel rewards family, the hotel card, deserves some praise, too. Here’s why: hotel cards for room

1. Transparent redemption

You’ve heard the story or perhaps experienced it yourself: You have a bunch of airline miles saved up, but, when you try to redeem them, there are no reward seats available for the lowest redemption amount. Instead, you’ll have to cough up twice as many points.

Things work differently, however, if you’re earning points in a hotel reward program. Many (although not all) of these programs have fixed redemption tiers.

Check out Starwood’s redemption chart, for example (Starwood’s co-branded credit card is the Starwood Preferred Guest card from American Express, a CreditCardForum advertising partner):

Starwood redemption chart 2015-01-26 15-15-36

If you want to book a category 3 hotel on a weekend, you’re paying 7,000 points (assuming a standard room is available). If you want a category 7 room on a Saturday, the most you’re paying is 35,000 points (again, assuming a standard room is available).

Exceptions may apply to ultra-luxurious properties (which may not have “standard” rooms) and at certain times of the year at resorts that see a seasonal influx. There’s also the “a standard room must be available” caveat, but you can remedy this somewhat by booking far in advance. Compare that with airline programs, which limit reward seat inventory, even months in advance when the plane is still half empty.

2. The sign-up bonus may be easier to use

One reason for this is simple math: A night in a moderately-priced hotel is usually less expensive than a flight in coach. So, if a hotel card gives you a glut of points as a sign-up bonus, it’s pretty safe to say you’ll have enough points for a night or two.

Some hotel cards make it even simpler by offering you a free night or two as a sign-up bonus. The Hyatt Credit Card, for example, rewards you two free nights at any Hyatt property worldwide after you make $1,000 in purchases in the first three months of getting the card.

3. You often get an anniversary gift every year (no minimum spending required)

Plenty of airline cards offer bonus points every year (either miles good for tickets, or “miles” good for status), but many of them require you to spend a certain amount on the card each year and pay the annual fee. Hotel cards, however, often give you a free anniversary night without an annual spending requirement.

The Marriott Rewards Premier card, for example, gives you an annual free night at any category 1-5 hotel.

4. You have a shorter climb to elite status

Some premium airline cards will give you a head start toward elite – and that head start is often tied to a spending requirement. Some hotel cards, meanwhile, automatically elevate you to the first tier of elite status, just for keeping the card open (find out which cards offer automatic elite status here).

Hotel programs’ elite perks vary and may include late check-out, complimentary in-room Internet, room upgrades and extra points for each stay. While it’s not always possible to assign a dollar value to these extras, it’s just plain nice to be elevated above the run-of-the-mill guest, especially when you’re weary from traveling.

5. You don’t have to travel to use your rewards and perks

Have a bunch of points stockpiled and no trips on the horizon (perhaps because you can’t afford plane tickets)? You can use your points (or free annual nights) for a staycation. Most large hotel chains are well represented in metro areas, so your card could get you a relaxing local getaway during which you enjoy any elite perks you get from the card.

6. Low annual fee

With rewards cards, you’ll often hear about the concept of “paying for itself.” In other words, do the monetary value of the perks and their ease of use justify the annual fee? With annual fees of $95 and lower (the Marriott card, for example, is $85 a year, while the Starwood card is $0 introductory annual fee for the first year, then $95), hotel rewards cards justify themselves, especially to low spenders. Even if you’re not spending enough on the card to earn regular free stays, the yearly free night alone can easily be worth more than the annual fee.

Words of caution

Airline cards are much more consistent when it comes to rewards, making it easier to compare them; you usually get 2 points per dollar on airline spending and 1 point per dollar everywhere else. With hotel rewards cards, though, there is a lot of variation in how many points you earn and how much they’re worth. So run a few test hotels through your desired card’s redemption page. A card that earns you more points per dollar may seem impressive – until you find that each point is worth far less than 1 cent each.

Also consider which properties you’d like to redeem your rewards for. If you’re comfortable staying in modest digs in metro areas, you’ll likely find you have a no trouble booking reward stays. Have your sights set on an exclusive resort in paradise? You’re more likely to run up against seasonal capacity issues and lack of availability many months in advance.

Tell us: Have you found hotel rewards cards to be rewarding? Or do you not have much use for them?

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