How to Redeem Points for Hotel Stays

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Yesterday, we gave an introduction to redeeming airline miles.

Given the choice, would you rather take a free flight or get free nights?

This is hard. Unlike flights, there are tons of cheaper alternatives for accommodations (stick around for a bonus lesson). But who can deny the luxury of a great hotel every now and then.

Some reasons you may prefer free nights include:

  • Staying in a nice hotel makes for a better vacation experience overall (because let's face it, no one enjoys flying in Economy)

  • The opportunity to stay in luxury hotels that you'd never pay for yourself

  • Extra perks such as room upgrades, late check-out, and even free nights

  • If you're more of a local/domestic traveler and would rather use points for nice hotels

Booking Hotel Rewards

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Booking hotel nights with points is a lot easier than booking an award flight. You don't have to start planning and booking so far in advance. Major hotel chains will typically allow you to book their standard rooms with points instead of cash. So you can often find even last minute availability.

If you would rather use your points on hotel stays, you can either:

  • Transfer your travel reward points to a hotel partner
  • Use a hotel-branded credit card

In our opinion, if you enjoy hotel stays and have a favorite chain, the best way is through a hotel-branded credit card. Hotel cards typically have reward structures that allow you to rack up the points much faster to trade for free nights. And you often get free nights as a bonus.

See our list of hotel cards with free nights.

Now, let's briefly go over the major hotel loyalty programs. We'll give you our opinion on the value of each.

Starwood Preferred Guest

The Starwood group includes Sheraton, Westin, St Regis, W Hotels, Le Meridien, Element, Loft, and Four Points.

  • Highlights: Points are perhaps the most highly valued points in the hotel world in our opinion. You can also transfer the points to over 20 airline partners. Plus, every time you make a transfer of 60,000 points to an airline, you get a bonus 15,000 points.

    You also get the 5th night free when you book a hotel stay at a category 3 to 7 hotel of 5 nights or more with points.

  • Downsides: Points are hard to earn.

World of Hyatt

  • Highlights: Hyatt is another popular hotel reward programs. Their award chart is very well priced. You can redeem your points for over 2 cents each at most hotels. You can also use a combination of points and cash, which can save you some points and stretch them further.

  • Downsides: Hyatt doesn't have as much worldwide availability. It has more than 700 locations in 56 countries. Compare that to 4,000+ locations offered by other major chains.

Hilton Honors

  • Highlights: If you get Elite Status (which you can do automatically with some of the Hilton co-branded cards), you get the 5th night free when booking an eligible reward stay of 5 nights or more with points.

  • Downsides: As you get to Category 3 and above, the value of each point goes down a lot. In general, we estimate Hilton points to be worth around 0.5 cents apiece. For lower categories, they can go over 1 cent, but the options are very limited. So we don't recommend transferring to Hilton. However, if you get one of the Hilton credit cards, you'll rack up the Hilton points a LOT faster.

Marriott Rewards

  • Highlights: If you use points to book 4 consecutive nights, you get the 5th night free. Also, Marriott occasionally offers PointSavers rates, where you can book nights at a hotel for the number of points of the hotel category below it (i.e., you can book a Category 5 room at a Category 4 rate).

  • Downsides: We find that Marriott Rewards tend to be poor value. In general, we value Marriott Rewards at around 0.5 cents a point for the higher category hotels. Lower categories hotels are worth more, often 0.8-1.0 cent based on our estimates. But most major destinations only have Category 6 or higher, which requires more points.

Wyndham

This group includes familiar roadside names such as Super 8, Ramada, and Travelodge.

  • Highlights: Redemption is simple: it's a flat 15,000 points for a free night at any Wyndham hotel, home, or condo. There are over 25,000 locations worldwide.

  • Downsides: In general, we feel that 15,000 points is quite expensive for what you get. Most Wyndham properties are budget accommodations. However, there are some upscale resorts worldwide that are great value for the flat redemption rate.

IHG

The IHG family of hotels includes InterContinental, Crowne Plaza, and Holiday Inn.

  • Highlights: Wide footprint with over 5,000 properties in nearly 100 countries. IHG has bimonthly BreakPoints® deals, where they release rooms in certain hotels at only 5,000 points per night.

  • Downsides: Aside from the BreakPoints deals, we don't think the points conversion is great and is often valued at far less than 1 cent per point.

This is just a quick little summary of the some of the major hotel programs. If there is a hotel chain you particularly like or are interested in, we strongly suggest you look into a co-branded credit card. Some cards offer a bonus worth 2 nights (or more).

Transferring your points from a transferrable credit card is also an option, but rarely will you be able to get the best value. One notable exception is transferring Chase Ultimate Rewards to Hyatt.

For your reference, here are the links to the hotel award charts:

Key Takeaways

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  • Study the hotel rewards and understand how many points you'd need with each hotel group.
  • See which hotel groups are available in the places you plan to visit.
  • General, lower category hotels allow you to use your points for more value.
  • Starwood and Hyatt are the most valuable programs, in our opinion.

Phew! Most of the heavy lifting stuff is done now. Congrats, you have now learned the basics of how travel rewards work and how to use them!

We'll see you back here tomorrow for the final lesson. Get some tips on organization as well as our cheat sheet of our favorite travel resources.


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