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Making the Most of the Starwood American Express

Aug. 16, 2016
Credit Cards, Travel Credit Cards
Making the Most of the Starwood American Express
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This page is out of date

With Marriott combining the Marriott Rewards and Starwood Preferred Guest loyalty programs, this page is out of date. See our details pages for the Marriott Rewards® Premier Plus Credit Card and the Starwood Preferred Guest® Credit Card from American Express for updated offers on these cards.

Getting high value out of the Starwood Preferred Guest® Credit Card from American Express is fairly straightforward: Use the card to pay for stays at Starwood hotels and pretty much anything else you buy; rake in the Starpoints; redeem the Starpoints for more hotel stays; rinse and repeat.

But there are a number of ways to get extra value out of the Starwood Preferred Guest® Credit Card from American Express. Let’s take a look.

Get up to 5 points per $1

First, let’s talk about this card’s rewards structure.

Cardholders earn:

  • Up to 5 Starpoints per $1 spent at participating Starwood hotels. You get 2 or 3 Starpoints per dollar just for being a member of the Starwood Preferred Guest rewards program, depending on your status. The other 2 points come from using the Starwood Preferred Guest® Credit Card from American Express to pay for your stay.
  • 2 Starpoints per dollar at Marriott Rewards properties. This perk is a result of the Starwood-Marriott merger.
  • 1 Starpoint per $1 spent on all other purchases. Unlike with some travel rewards cards, you don’t earn extra points on plane tickets or other travel expenditures. But 1 Starpoint per dollar is still pretty good. More on that below.

Redeem for hotel stays to maximize value

With most rewards credit cards, a point is worth about 1 cent. So a card that gives you only 1 point per dollar has an effective rewards rate of 1%. That would elicit a big fat yawn from the Nerds and other credit card optimizers.

But a Starpoint is worth a lot more than a penny. The cash value of Starpoints depends entirely on how you redeem them, and you get the most value by far when you redeem for stays at Starwood hotels. NerdWallet calculates that, on average, the value of a Starpoint is 2.3 cents when redeemed at hotels. At that value, your effective rewards rate can be as high as 11.5 cents per $1 spent at Starwood hotels.

The 2.3-cent valuation is an average across all Starwood properties. Getting more specific, NerdWallet calculations peg the value of a Starpoint at:

  • 2.7 cents for domestic weekday stays.
  • 2.4 cents for domestic weekend stays.
  • 2.2 cents for international weekday stays.
  • 1.9 cents for international weekend stays.

If you’re after maximum value for your points, then use your points when booking a room during the week at a U.S. hotel.

» MORE: Full write-up on the value of Starpoints

Nerd tip

Booking all your stays within the same hotel group allows you to get to elite status more quickly. With Starwood Preferred Guest, you’ll reach Gold status after 10 eligible stays or 25 eligible nights in a calendar year. Members with Gold status are eligible for the full 5 points per $1 spent.

Other redemption options

Although redeeming for domestic weeknight hotel stays is the best deal, you can also transfer your points to one of SPG’s 30 or so airline partners. You won’t get maximum value for doing that, but if you have points to burn, it’s not a bad deal. In most cases you’ll get 1 mile per Starpoint, with a 5,000 Starpoint bonus if you transfer 20,000 points at a time.

Since qualifying hotel stays will earn 4 to 5 Starpoints per $1 spent, transferring those points to an airline offering a 1-to-1 exchange rate means you’re getting 4 to 5 airline miles per dollar spent on hotels. That’s a higher rewards rate than most co-branded airline credit cards offer.

How to redeem rewards on the Starwood Preferred Guest® Credit Card from American Express

The Starwood Preferred Guest website is a thing of beauty. Well-designed and easy to use, it makes redeeming Starpoints pretty effortless. Just log in to your account and navigate to the redemption page.

Should you make it an everyday card?

Put aside the question of how much you spend at hotels for a second, and just look at the day-to-day rewards available with this card. You’ll be earning 1 Starpoint per dollar, which works out to a rewards rate of about 2.3%, assuming you redeem for hotel stays.

There are cards with higher rewards rates than 2.3%, but they tend to be cash-back cards that offer those rates only in bonus categories. Flat-rate travel cards, meanwhile, tend to top out at a 2% rewards rate.

That’s why the Nerds think the Starwood Preferred Guest® Credit Card from American Express is actually a very solid card for everyday use, not just for paying your hotel bill.

As long as you use Starwood hotels enough to earn elite status and get the highest possible redemption value out of your Starpoints, you could do a whole lot worse than the Starwood Preferred Guest® Credit Card from American Express for day-to-day spending.

Virginia C. McGuire is a staff writer at NerdWallet, a personal finance website. Email: virginia@nerdwallet.com. Twitter: @vcmcguire.