Should I Use Points For My Hotel Stay?

If you’ve read my blog for more than a week, hopefully you’ve picked up on the core philosophy I preach when it comes to this hobby:


And usually I’m pretty good at following my own advice when it comes to that. My one exception, however, is Starpoints. Starpoints are one of the few points currencies I don’t mind hoarding, because I tend to think their value is pretty safe. And in a way a lot of the value of the points comes from their flexibility.

I value Starpoints at a minimum of 2.2 cents each. That’s because Starpoints convert at a 1:1 ratio to over a dozen airline programs, and for every 20,000 points transferred you get a 5,000 point bonus. So each Starpoint is basically worth 1.25 airline miles, and at a valuation of 2.2 cents per Starpoint, that’s a valuation of ~1.76 cents per airline mile. That’s about as low as I want to go on my valuation, since Starpoints can be transferred to Japan Airlines, for example, which has a ridiculously lucrative award chart for redemptions on Emirates.

With that in mind, I rarely find a hotel that I want to redeem my Starpoints at. Not because it can’t be a good value, but because I interpret “value” differently than others. To me the value I’m getting out of a redemption isn’t the retail cost of it, but rather what I’d otherwise be willing to pay in cash for that redemption.

For example, I’m going to Florida over Christmas, and my parents want to go somewhere. So naturally I’ve been looking at options using points. The W South Beach is 35,000 Starpoints per night, and if you redeem for four nights then the fifth night is free, so let’s call is 28,000 Starpoints per night. Meanwhile the paid rate with tax is nearly $1,500 per night, so that’s over five cents per Starpoint compared to the revenue cost.


That’s objectively an amazing value, and I was going to pull the trigger on it, but then I did the reverse math — I value Starpoints at 2.2 cents each, so I’m still “spending” over $600 per night “worth” of points. Do I value the stay at that much? It certainly makes me think twice!

I actually had a similar math “challenge” on Friday. I wanted to stay at the SLS Beverly Hills for one night, because I was meeting a friend for dinner there and also wanted to review the hotel, and figured a one night stay was the perfect opportunity to do so.

The Cash & Points rate was $208.04 including tax plus 10,000 Starpoints. That’s certainly not a cheap rate, but at least out of pocket it’s not totally horrible. Still, that’s $220 worth of Starpoints, valuing them at 2.2 cents each, for a total of $428.04.


Meanwhile the AAA rate was $401.81 including tax, so was objectively a better deal.


And then on top of that, the American Express Fine Hotels & Resorts rate was $472.72 including tax, which included a $100 hotel credit and complimentary breakfast (meaning I wouldn’t have to give up 500 Starpoints for breakfast), so was an even better deal.


But that’s also the point at which I say to myself “wait a second, why would I spend almost $500 when I can spend $200?”

In the above two circumstances I actually probably objectively made the wrong decision in both cases. I didn’t feel like spending 140,000 Starpoints for a five night stay even though compared to the retail cost it was an amazing deal, but at the same time did end up booking Cash & Points at the SLS Hotel, because it just “felt” better to spend $200 rather than $400-$500.

As crazy as it sounds, I think the reason I struggle so much with Starpoints is that they’re too valuable for their own good, and that’s thanks to the ability to convert them into airline miles at a (more or less) 1:1.25 ratio. Most points currencies can’t be converted so efficiently, so their value is tougher to quantify, or more accurately the opportunity cost of the points isn’t quite as clear.

At the same time, points are only as valuable as the experiences you get out of them. Whether it’s points or money, it makes sense to make rational decisions most of the time where the numbers “add up,” but there’s also a middle ground where non-efficient spending is fine, in my opinion. For example, there are very well off people that still manage to blow all their money by living day-to-day, while there are very well off people that never spend a dime if they can avoid it, and miss out on experiences as a result. I think it’s the same thing with points — there’s a middle ground between the two that can be tough to find, but sometimes it can lead to irrational decisions that are still justifiable.

Anyone else have similar (first world) struggles when it comes to redeeming points? Am I off base? What would you do in the above two circumstances?

Filed Under: Advice, Starwood Preferred Guest
  1. Sure hope you don’t jinx us into a new Starwood devaluation! You forgot to mention that a lot of it has to do with where you have miles and how many you have. It has been much, much easier to get/buy airline miles rather than SPG points. I so love traveling in style that I save those SPG points exclusively for hotels, Cash and Points when I’m lucky enough to get them. Imagine if you could buy SPG points like we buy US Air miles!

  2. I guess it depends on what you value. Personally I value a comfortable long haul flight a lot more than a couple of hotel nights since it is usually possible to find a perfectly fine hotel with all of the necessary amenities (to me) for much less than the points cost. Particularly in relation to what it would cost me to buy the airplane ticket.

    If I was swimming in millions of points then I would have less compunction about spending them on everything including hotels. But since I am not…

    I guess I don’t really “value” hotels so much. I prefer to be left alone for the most part. Give me a place in a good location with a bathroom that works, a mattress that’s comfortable, a TV that works, and a usable internet connection and I am happy. I don’t need fancy restaurants, spas, designer bedding, etc. In fact I usually prefer to stay in a serviced apartment if I can find one since they tend to be cheaper and have fewer amenities that I never use anyway.

  3. i can sympathize with the internal mind games. i was hoping to book W Taipei for cash and points for a 4 night stay. unfortunately only the regular award night is open. so do i book 20,000 per night (and on top of that I would be unable to reap the value of 5th night free!) or do i find an alternative hotel…decisions decisions

  4. Taking your advice and currently burning some Club Carlson points at the Radisson Blu Polar Hotel! I need to do this more often… now just a way to make use of all my SkyPesos…

  5. Couldn’t you use the 50% off cert to knock that rack rate in Florida (and the associated point valuation)?

  6. I struggle with this conundrum as well sometimes. I think it’s very situational, and I think sometimes, it’s okay to make a points-based decision that isn’t “maximizing” the value of those points. For example, my wife and I are spending a night in San Diego a few days from now. Revenue rates are really cheap–most Hilton and Starwood properties have flexible rates in the $109-$129/night range.

    So the points side of me is saying, “why would I spend 30,000 Hilton points on something that only costs $119? I should pay for that stay, save the points, plus earn points for the stay.” But the flip side to that is, free is free – I have half a million Hilton points, so I really don’t care about 30,000 points. We ultimately decided to spend 30,000 points, even though the value isn’t good, because that’s $119 that we now feel good about spending elsewhere during our vacation.

    In terms of SPG points, I struggle to view them being as valuable as many argue they are. I’ve never transferred them to airline miles, because the points don’t transfer instantly, and that’s a huge negative to me. I end up spending them at Starwood hotels, which I’m happy to do. The problem is, they’re so hard to earn. The SPG credit card has no bonuses on any spend, so it takes forever to earn points. Between the slow transfers and the inability to earn points easily, SPG points are not nearly as valuable to me as they are to others.

  7. We live in a points world, but the world runs on money. “Cash is king”!

    Another thing to consider is diversifying your risk. In the future maybe having an extra $200 or 10,000 starpoints will be of great marginal value to you. You can hedge your bets by choosing cash and points.

    If I wanted to stay at SLS and I was eating at the Bazaar, I would book FHR and apply the credit to the restaurant. The W rate isn’t good value (to me) at either the cash or points rate.

  8. I can see your predicament. The conversion efficiency of the points into miles is VERY good which makes pointing hoarding very viable. (LOL – my wife calls me a serial saver when it comes to points and miles because I always tell her it’s just a way of “keeping score”.)

    Anyway, with the very important caveat that it “depends on the circumstances”, I would tend to side with RakSiam in this. Air miles offer better “functional comfort” than hotel points. That said, however, in the specific circumstances detailed in your post, I would have used the points for the SoBe hotel stay because I would have approached the transaction more akin to a “gifting” transaction than a personal consumption transaction. Likewise, I would have probably bought the SLS stay at the AAA rate (or in my case the senior/AARP rate) because the “true” cost of the points and $ outlay was higher than the affinity rate.

  9. Excellent post. I go through the same calculations and decisions in my own head. It’s tough sometimes! #firstclassproblems

  10. I struggle to understand who would pay $1500/night at a W hotel in South Beach. There are way better hotels and nicer locations I would consider before this one.

  11. If you want to know how truly awful your entire train of thought is, go to, search places without a .5 mile radius of the SLS, and see the dozens of listings of fully furnished apartments that will have 5 times the size of any SLS suite upgrade, free wifi and free parking…. all for less than half the price

    And yet this doesn’t even enter your thought process, because breakfast wouldn’t be “free”, and because you want to get platinum amenities so that you can get things like free wifi (which are free and much faster in most apts) and a room upgrade (to a room size that is still far smaller than any apt. you can rent

  12. @Ben — Rob brings up an interesting point. How about trying out airbnb and doing some reviews for us? Maybe we are all stupid for being so loyal to hotel companies. My partner and I spend about $13k – $14k a year for about 100 hotel nights, mostly in suites at nice properties with “free” club access. I wonder how much of this we could save by using airbnb instead? I wonder how the experience would compare?

  13. My life choices do not follow conventional wisdom in this country. I never pay more than $80 for domestic hotels and $150 for oversea hotels. I use points in expensive touristy cities while staying at local hotels elsewhere. My top priority is to be free of consumer and mortgage debts. Granted, I am now but I will never have pension,benefits and sizable nest eggs that those with stable career with 20+ years of experience have, whose annual salary is above $50K. I only need a safe, clean and quiet hotel with heat, running water and power because I travel off-season due to my business scheduling demands.
    Living & working abroad and mingling with the locals truly give me different perspectives in life, appreciate what I have, help others and give back/ contribute to society. My comments may be off-topic but my buying power depends on my goals and purposes in life.

  14. @Gene,

    A few months ago, I rented right near the SLS an 800 sqft. 1br apartment in Beverly Hills that came with free parking, free wifi, big screen tv/netflix and a fully kitchen with utensils for $140/night

    …. but it didn’t come with free breakfast. I had to go out and buy it for $7 or make it myself. And I didn’t get free wifi because of status…. I merely got it because it is standard

    So in retrospect, what was I thinking by not ponying up $450 or $210 + 10000 SPG points + $40/night in parking for the SLS?

  15. I have to agree with Rob. Sometimes I was so into the points valuation vs paying cash, I forget I do have other “options”. So I try to balance our trips with SPG/Hyatt stays and Airbnb/local guest house stay. But I do value SPG points highly since I don’t swim in them yet and they are so hard to earn.

  16. I always take points over cash every time. If you play this game properly, your cpp should be close to zero and thus any thoughts of paying out of pocket is absurd

  17. I’m on the low end of the spectrum. there is no hotel in the world i’d pay $300 a night for, and only a couple $200, and most not over $75. not cheap, just don’t have the money.

    my best use for SPG points is the only reasonable part of their award chart category 1 and 2- trying hard to make spg stays on the weekends. some category 3 if really nice and for 5 nights to drop the # of points.

    but now that i’ve ms and hoarded over 215,000, some of the airline transfers are tempting. thing is, a lot of airline miles are MUCH easier to generate than spg points, so i have opted against thus far.

    honestly, i think my best bet is to become a famous blogger to get comped trips! seems a sensible approach. aye, Ben?!?

  18. @Robert Hanson


    What I think is that SPG has done such a good job of suckering Lucky (i’ll give the benefit of the doubt and assume his infatuation with SPG has nothing to do with his affilite relationship with Amex) to the point where he’s debating whether to blow $472 at the SLS without even so much as considering that for that price, he can rent entire houses in the same zipcode

  19. In our household we don’t bother with assigning any monetary value to our points. We tend to think under $200 we will pay anything over and points is the go. However we do keep sufficient points in our various accounts to redeem for 1 night in case of expensive emergencies. Our last minute trip to Frankfurt last month hotels were exp. 400 euros a night. We scrapped together the last of our priority club points and redeemed for the IC.

    We live permanently on the road. We stay Ina mix of VRBO, major chains and bookings thru POintshound. We have come to realize that for 99% of the time we can get a good hotel that we have no hesitation to pay for. However shelling out of pocket for a biz/first airfare is a biggie. For that reason I don’t redeem any star points for hotel stays but transfer to airline programs to get those comfy seats up front.

  20. I’ve got 75K United points and 67K Hyatt points — both about to be devalued — so I’m planning to get the most bang for the buck — even if that means taking a trip to someplace I may not even want to go!

    So I caught myself and am now looking at three nights at the Hyatt Grand Berlin for 60K points for four nights and LH First class LAX-MUC (F) and MUC-TXL (J) for 67,500 and $93 if everything works out right.

    Will fly back BA F 380 TXL-LHR-LAX (STOP) – JFK for $474 taxes.

    Then I checked Hyatt Grand Berlin pricing and it’s $170 a night while I’m there so I’m not going to spend 60K points for a $680, especially when I can apply an expiring suite upgrade — but then I thought, do I really want to spend $680 plus taxes when I could just redeem? And if I don’t redeem, then I’m stuck with devalued points!


  21. @Michael Are you purposely leaving out the fuel surcharges on BA, or do you get some sort of personal exemption from them?

    And if it’s the latter, can you get me on the exemption list too? 😉

    If you haven’t been to Berlin, go. We’ve gone there each of the last 2 years and would still love to go back. The walking tours thru WW2 history, and the Checkpoint Charlie Museum are worth going on their own.

  22. @lucky – This might be slightly off topic, but it relates to SPG, do you have any experience in how long it takes for SPG points to transfer to Miles and More? Just curious if anyone has any experience.

  23. @Robert Hanson,

    No, the fuel charges for TXL-LHR-LAX are $474 on AA (plus 62,500 miles).

    I was not clear with my Hyatt redemption.I have 67K points and the Grand Hyatt Berlin would be 60K (pre-devaluation) for four nights…

    I do want to go to Berlin as I’m an architectural buff and love pop up restaurants and Berlin has both!

  24. @EthaninSF — I transferred some SPG to M&M last week, and it took between 24 and 48 hours to post to my M&M account.

  25. It might be worth taking a step back and looking at the lifestyle you are talking about. $400/night in Beverly Hills, for essentially a room, a bed, maybe a restaurant and a gym — accommodation! $600+/night for South Beach. You know you could probably have easily found accommodation for half the cost, hardly noticed the quality difference, and had hundreds of dollars extra left in your bank account afterwards.

    Clearly you aren’t hurting for money. Points are cheap to acquire via credit cards etc, and no doubt your award and credit card businesses are going well, and maybe you can deduct some or all of the costs as work-related. Still, is this the lifestyle you want and intend to sustain?

  26. As a followup to AS at no. 29, I would be very interested to see an honest post from Lucky or similar bloggers on how much of their travel expenses they attempt to write off as business expenses, under the umbrella of their self-employed work as a miles/points blogger. I’m not going to say whether that’s good or bad, it is probably completely legitimate in most cases, as long as the blogger establishes a clear trend of written reviews for flights/hotel stays.
    But just imagine if these bloggers are writing off all the hotel night costs and flight award fee/taxes related to int’l award flights in first class. What a nice racket they’ve developed in that case, huh?

  27. For most people these points are earned on the company expense account and as long as you are getting some value, who cares.

  28. @Brazilflyer “Writing it off” doesn’t mean free. It means deducting it as a business expense, reducing the taxable base of earnings before.. paying taxes. It amounts to a discount, but I assure you, even if I could write off international F tickets, I still couldn’t afford the cash price!

    To bring in @AS’s points – Lucky, on the other hand, might be able to. If you’ve read this blog for a while, you’ll see the cash fares he’s purchased (and stated as such) as well as some prior family travel that suggests paid. But whether it’s coming out of pocket or is a cost of running his business, I’m not sure how much I care. In the end, he’s blogging content that helps others plan their trips – just because he’s staying at a $500 property on a Tuesday night doesn’t mean someone else doesn’t pick up that info and use it to plan a big vacation they’ve saved for, a honeymoon, whatever else. But I do know that nobody would read this blog if he was reviewing Motel 6 and random VRBO properties – not because there’s anything wrong with them, but because they’re mundane. And that loss of readership WOULD hurt his business. I don’t know Lucky, I’ve never met him, and don’t work for him, but I will guess that this blog generates a lot (most?) of his business referrals. THAT’s why he’s staying at the SLS and writing a post on whether to pay cash or use points.

    On a side note, anyone who’s interacted with Lucky in the comments here or on twitter can probably tell you he’s a pretty nice guy who goes out of his way to help. Despite the fact that he runs a business entirely centered on monetizing his travel knowledge, he always answers the random questions that people throw his way – myself included. Therefore, if I’m going to give anyone a hard time about their lifestyle, how they get their money, or how they spend it, it’s not going to be him. It’s probably not going to be anyone, but it’s definitely not going to be him.

  29. @ Michael — For what it’s worth I don’t really think Hyatt points are devaluing that much, and arguably their value is going up with cash & points for any non-category seven redemptions. At that rate I’d definitely book the revenue rate in your shoes.

  30. I really struggle with Starpoints in that I think they really are the most valuable points out there, so I have been hording them and did not want to spend them — even for hotel nights! Ha!

    I have a family trip planned for next year and we definitely want to stay at a comfortable place (high end not necessary, just comfortable with good service). We will need two rooms and we also want to minimize the cash outlays.

    So, for each room with the 5th night free, I’m looking at about 76000 points for 6 nights. Each retails around $300+/night so it would be decent use of miles. Not the most awesome use, but it’s decent and meets my targeted goal of less cash outlay.

    And yet, I had the biggest second thoughts about how it could be better use towards business flight redemption or even just paying cash for an apartment style lodging for a cheaper cost (not hotel style, not preferred for excursions)

    Ultimately, I think I will use the Starpoints because what’s the point of hoarding them when I could save NOW, but I have to admit that I have a lot of second thoughts about it (but I know my family will enjoy the stay more).

  31. I consider SPG points my emergency stash. Because of the ability to transfer to so many miles it is difficult to burn the bulk of them on hotels.

  32. I go through the same calculation in my head before using points.
    In addition to comparing the chain hotel rate in $ and points, I do compare to other options though – pretty much anywhere outside the US, you can usually get a comparable non-US chain hotel for a lot less money, reducing the “value” of those points. And you get a much more local experience as well – no charge!
    Even in the US, you can often get a comparable hotel on priceline for a lot less than the hotel web site (or airbnb as somebody suggested), so getting that 2.2c/pt value is a lot harder if you compare more broadly!

  33. There are definitely good times to use SPG points on hotels.

    A great use, if you can do it would be to combine 5th Night Free with 25%/35% requalification gift (Gold/Platinum) which is what I did in Vienna (Hotel Bristol). Or if hotel rates in a city are truly unreasonable and you don’t want to bother with B&Bs/AirBnB (paid 12K/night for Four Points in Zurich).

    @ Lucky – what do you think think are the best airlines to transfer to out of SPG? SQ KF can be had through MR, so do you think it’s LH/LX/OS M&M (to actually be able to book F in advance), JAL MB (for Emirates), or another one?

    P.S. Speaking of Miles & More, found out last week their points can be bought at $0.02/mile by signing up for GetAbstract (through a link on M&M site). You get 15,000 miles for a 12-month subscription ($299) and you can get credit for up to 3 subscriptions per M&M account. Cheapest current way I’ve seen to obtain M&M.

  34. I don’t have millions of points or miles to burn, so I try to be strategic. That said, we burn for vacations that we wouldn’t normally be able to afford. On my income, I could easily afford 2 European trips per year, but I like to travel abroad 4x/yr…so I burn for those other two trips.

    Case in point: burned AA miles for F to hawaii at Christ,as (SAAver award) and my hyatt free nights at the Andaz Maui and all my starpoints for 5 nights in Honolulu and another couple nights in Maui. Rack rate was way more than I would spend.

    Also just burned CSP points to transfer to united for an F trip to Europe in August. Snagged saver awards for 2 and pounced.

  35. Folks….Lucky writes a blog. And he reviews hotels and airlines. He stated why he wants to stay at the SLS and one reason was to review it. For us. His readers. So we should appreciate that he is willing to pony up the $ (or points) to do it. Yes he could stay at someone’s furnished apt for less. And have wifi. But that’s not what this blog is about.

    I live in LA and welcome a review of the SLS. Not because I will stay there, but in case I have friends or business associates looking to stay.

  36. Lucky, good post.

    I frequently perform similar calculations. I currently value 1SPG = $.021; but I might need to lower this further given how SPG’s airline partners keep devaluing their airline miles.

    Here are some factors I also consider:
    1) Utility of money and utility of star points. For example if I have only $10,000 in the bank and 5,000,000 star points, I would skew to using the star points.

    2) Think about whether you are using SPGs from the “top of the pile” or the bottom. For example, if you have 5,000,000 star points and only use 500,000 per year; it would take you 10 years to exhaust your supply. So, you have to assume you are using “bottom of the pile” star points that will be devalued multiple times every year or two in the future. Whereas, if you have 100K SPGs, and burn 100K per year, this is a non-issue.

    3) Think about whether your trip is a tax deductible business expense. If it’s tax deductible, you probably need to get at least 50% higher value (depending on your tax bracket).

    Finally, if after taking into account the above, you find yourself departing form the “Objectively right answer” according to the formulas you use, your formulations or valuations should be reconsidered.

  37. There are some cities (including New York, London, Paris) where both basic hotels and vacation rentals are outrageously expensive. That’s where Starpoints and Club Carlson points can be a lifesaver. In those cities I redeem for Cat 5 SPG properties (12,000 pts @ 2.2 cents/pt = $264; or $211 with 5th night free) or CC 2 night stays with 2nd night free (50,000 pts @ 0.5 cents/pt = $125/night for 2 nights). I’m comfortable maintaining a stash of SPG points; spend my Club Carlson points as soon as I earn them (devaluation is inevitable).

  38. Everything UAPhil said. My SPG points have been used to pay for vacations to London (8 & 10 days respectively) & Manhattan (3 days) over the past 2 years. Indeed, I’m sitting in a Le Meridien Piccadilly junior suite as I type this. There was no way I could afford even the Best Western hotels or short-term apartments in those cities in those towns. I’m also of the age/personality where there will be no more hostels.

  39. @Rob @Gene – Airbnb is my go-to place for accommodation. Not just because it’s affordable, but most hosts I’ve met are fellow world travelers who genuinely enjoy meeting you. Esp when I travel solo to somewhere new, I enjoy meeting locals and that’s a great to start. I save hotel points for the occasional aspirational stay.

  40. @Lucky,
    I fully understand your feeling but I have never redeemed any spg points for hotels.

    For me, the reason is clear and simple: every year I have to spend b/t $5000 and $10,000 on airfare. So, I don’t have that struggle when I have to spend cash at starwood, as long as I am sure that I will eventually reduce more cash expense at airfare.

    Actually, I value spg so highly when being transfer into airline miles that I watch spg transfer promotion closely so that I wish the 35% spg points transfer bonus into AA miles in 2010 will return again some day.

  41. @italdesign,

    you pay cash out of your own pocket at airbnb to save hotel points. if you hotel points are not enough to cover your entire hotel expense, that is reasonable. otherwise, where can you use your hotel points at reasonabley good value?

    i am not questioning your strategy. my question is to ask — are you implying you have a better strategy to efficiently use hotel points at better values rather than using them for free hotel stays?

    this is because i face a similar situation. i accumulate almost a million marriott reward points. because i also have many marriott certificates (category 1 to 5) earned from quarterly promotion, those certificates alone are enough to cover my annual hotel demand. therefore, i am looking for a good way to make use of my hotel points, especially marriott reward points. i even consider whether or where i could sell my marriott points or even sell my marriott certificates? 🙂

  42. Personally as strictly a domestic traveler, there are only a limited amount of airlines vs. dozens to chose from when traveling for business or pleasure.

    Plus there are websites which carry discounted hotel prices; discounted hotel options for brands which I’m a loyalty member, i.e. Holiday Inn, Hilton; and with a AAA and AARP card it would be foolish of me to use the SPG Points unless it was only a last resort.

    Whereas with airline prices soaring and reward tickets becoming increasing more limited, I’ve both transferred SPG points when there’s been a promotion and used the SPG points for flights. Sometimes using the SPG points for a flight is the only available award option available.

    For me, I take it on a case by case basis.

    WARNING: Their change/cancellation policy and fees are very expensive and limited so call before you book the ticket.

Leave a Reply

Your email address will not be published. Required fields are marked *