The Hilton credit card is offering 40,000 Hilton HHonors Points as a signup bonus if you spend $750 in the first 3 months. This makes the no-fee Hilton card an even better deal for hotel-goers who aren’t big spenders. Those points can be pretty darn valuable, if and only if you spend them in the best way. We value HHonors points at anywhere from 0.4 cents each (awful) to 1.7 cents apiece (¡vamonos!), with an average of 0.5 cents, so that 40k-point bonus is worth $160 to a whopping $680.
As hotel credit cards with no annual fee go, the Hilton credit card is among the best options. Most cards will reserve the killer rewards rate, enticing signup bonus and fringe benefits for the credit cards with annual fees, leaving the no-fee cards in the dust. But while the Hilton HHonors Surpass has perks that more than mitigate its annual fee, the no-fee Hilton HHonors credit card has long been a sound travel choice, complete with rewards and elite status. Now, with this signup bonus, it’s even more attractive.
The rewards keep on coming
We value Hilton HHonors points at anywhere from 0.4-1.7 cents apiece, with an average of 0.5 cents. On top of the 40k-point bonus, it gives 6 Hilton HHonors points per $1 spent on gas, groceries, drugstores, and Hilton hotels, and 3 points per $1 spent elsewhere. Best of all, you also receive complimentary Silver Elite status for the life of the card, and an upgrade to Gold status every year you spend $20,000 or more. You also get quite a few perks, including:
- A discount on redemption for Category 5 and 6 hotels
- Lost baggage insurance
- Warranty extension
- Purchase and return protection
Even assuming the average point value of 0.5 cents (again, it can go as high as 1.7), the Hilton credit card has a pretty good rewards rate: 3% back on bonus categories and a 1.5% base rate. That’s better than most other no-fee cards. The Chase Freedom, one of our most popular, gives a 1% base rate with 5% back on bonus categories that change quarterly, and comes with a $100 signup bonus. The Chase Sapphire gives 2% on dining and 1% elsewhere, with a $250 signup bonus. Neither comes with perks equivalent to elite status. For this reason, we believe the Hilton card to be one of the best no-fee credit cards, as long as you stay at the hotel chain.
So the no-fee’s good. Can we do better?
Though the Hilton’s among the best no-fee cards, the Hilton HHonors Surpass card is even better. It has a signup bonus of up to 60,000 points (40k on your first purchase and 20k if you spend $3,000 in your first 3 months) and gives 9 HHonors points when you stay at the Hilton, rather than just 6. The rest of the rewards structure is the same. But in exchange for a $75 annual fee, you receive:
- Complimentary Gold status your first year, and every year that you spend $20k or more
- A complimentary Priority Pass airport lounge membership, valued at $99, that gets you into over 500 lounges worldwide.
The math is simple: Priority Pass membership is worth $99, and the annual fee is $75. Even ignoring the rewards bump, the higher signup bonus and the first-year Gold status, the numbers tell us that the Hilton HHonors Surpass is well worth the annual fee.
How to redeem your HHonors Points to get the best value
First off, you have to redeem them for hotel stays, or else their value drops 75% or more (exception: sometimes Hilton has preferred partners and will offer a discount if you redeem for their programs. For example, as of this writing, you get a great value if you redeem for an Alamo car rental). Within hotel redemption, Hilton divides its hotels into 7 categories and charges 7,500 points for a night at a Category 1 hotel and 50k at a Category 7.
We can take advantage of the fact that hotel prices are all over the map, so whether the room’s rate is $99 or $139, you still need to pay, say, 35k points. Within a category, your value is maximized when you choose the most expensive hotel room in that level.
Between categories, your best bet is to choose a lower tier. Why? The increase in points paid per category rises between 50% and 88%, but the increase in dollars paid per level is much more variable and also much lower. So you might be paying 50% more points, but you’d only pay 20% more if you used cash. Your best bet is to find a Category 1 hotel, but those aren’t the easiest to find in the US, so just be cognizant of the benefits of choosing a lower tier.
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