Hotel Points VS. Airline Miles – Which Card is Best for You?

May 26, 2011 1 Comment »

When it comes to reward cards, those that offer some form of travel rewards are probably the most popular. But which type is best for you – frequent flyer or hotel rewards? You may be surprised to discover that the answer isn’t always clear cut. Why? Because many offer hotel points that can be converted to airline miles and vice-versa, which means you shouldn’t confine yourself to just one category. You have to consider both.

The versatility of hotel points

The Starwood Preferred Guest, Priority Club, Hilton HHonors, Hyatt, and Marriott credit cards all let you convert points to airline miles if you wish to do so. However the conversion rate varies greatly with each program. For example, with the Starwood Preferred Guest card from American Express, each point is worth one mile on over 30 different airlines – an amazing value! On the other hand, it would not be a smart idea to use the points you get from Marriott credit card promotions to buy airfare, because the conversion is only 1 mile per 5 points when used for the lowest level of redemption. Unfortunately most of the others have conversions similar to the Marriott rewards program. Starwood is in a class of its own for giving 1 for 1 on most airlines.

So ultimately, with the exception of the Starwood card, your best bet is to actually use your points for hotel stays rather than airline miles. As far as which one is the best to do that all depends on where you typically stay. If you like low-cost hotels (and in turn, rooms that won’t cost you a bazillion points) then the Priority Club Visa is worth considering since their program includes places like Holiday Inn, Candlewood and Staybridge Suites. For mid-tier hotels, the Marriott Rewards credit card might be the way to go. If you like the swankiest places, go with Hyatt, Hilton or Starwood.

The versatility of frequent flyer points
Almost all of the frequent flyer programs allow you to convert points to partner hotel programs but more often than not, it’s not a very favorable exchange. For example, to stay four nights at the Radisson using your United Airlines Mileage Plus card would cost you almost 60k frequent flyer miles. To put that in perspective, that’s enough miles to score you a free roundtrip ticket to London which would normally cost upwards of $700 to $1000 or more. Contrast that to the dollar value of paying cash for four nights at the Radisson, which may be as little as $350 depending on the property.

Other factors to consider
Of course, it’s not just points and miles. These types of credit cards also throw in a number of extra perks and you have to price those into the equation. For example, both the Continental Airlines OnePass Plus and Delta SkyMiles cards give you the first bag free for yourself and up to eight other people traveling with you. That’s a savings of $50 per head, per trip. This is such a valuable benefit that I actually recommend regular customers of these airlines to get their affiliated card for that reason alone.

When it comes to hotel rewards credit cards, they also give you some icing on the cake. Take the Hyatt card from Chase. As a cardholder, you’re automatically entitled to the best room within whatever tier you booked, priority check-in, and there is no extra charge for in-room internet. With the Marriott credit card you get late checkout. The best credit card reviews will point out the extra benefits that are offered on each, but remember, a benefit is only worthwhile if you actually use it!

Another option: general travel rewards

The cards we’ve discussed will make the most sense for people who regularly use a specific airline or hotel. If you’re someone that doesn’t have any loyalty towards one company, then you may want to go with a credit card that offers general travel rewards.

If you’re a high roller and don’t mind dropping 450 bucks a year on a shiny piece of plastic, then read my American Express Platinum credit card review. It offers quite a few airline and hotel perks but at the end of the day, the American Express Platinum card will probably only make sense for frequent travelers who typically stay at the higher-end hotels and travel internationally. For the other 95% of us, something like the Chase Sapphire will make a lot more sense. There are two versions – one has no annual fee and the other is a relatively modest $95. Check out this credit card review for the Chase Sapphire Preferred and I think you will be impressed by the promotion that comes with it!

This is a guest post from the owner of CreditCardForum.com

 

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  • Ric Garrido

    1. Hilton HHonors is the only hotel program that allows the exchange of airline miles into hotel points. You might be able to get hotel room nights using frequent flyer miles, but you can’t exchange miles into hotel loyalty points in other hotel programs besides Hilton HHonors.

    2. While it is true that SPG American Express is one of the best credit cards for earning points to exchange into miles, it is not accurate to say that Starwod Preferred Guest is in a class of its own for exchanging hotel points into airline miles.

    I have compiled tables of exchange rates for hotel points into airline programs and SPG is actually #3 or #4 in most cases for the best exchange rate.

    Marriott Rewards and Club Carlson (Radisson) actually have better exchange rates. These two programs have variable exchange rates meaning the exchange improves as you transfer more points.

    Marriott Rewards offers 50,000 miles for 125,000 points with most U.S. airlines. While the credit card earn rate is less for Marriott than SPG, it is fairly safe to assume that someone with a credit card is also going to stay in that hotel brand. When comparing the rate that points are earned for hotel stays, then Marriott, Club Carlson and Wyndham Rewards actually tend to have better exchange rates than SPG for hotel points to airline miles transfers.