American Express is ever-present in traveler wallets. Their Starwood Preferred Guest® Credit Card was long a favorite hotel credit card thanks to its high value Starpoints.
While the value of Starpoints has changed, the Starwood Preferred Guest® Credit Card is likely to remain at the top of the list for best travel credit cards. However, for folks who want even more travel rewards, American Express will be rolling out a new premium credit card.
The Starwood Preferred Guest® Luxury Credit Card is designed specifically for avid jet-setters. Available starting in August, the card features a long list of premium benefits, but it comes at a price. Is the Starwood Preferred Guest® Luxury Credit Card worth the $450 annual fee?
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Starwood Preferred Guest® Luxury Credit Card key features
This is one of very few travel credit cards to offer 2 points per $1 on regular spending, and on top of that, they offer 3 points per $1 on dining and flights and 6x points on purchases at SPG and Marriott properties. The Priority Pass Select membership, one of the card’s most valuable benefits, gets you access to over 1,000 airport lounges worldwide. Another valuable benefit is the $300 annual statement credit on SPG and Marriott purchases.
Is the Starwood Preferred Guest® Luxury Credit Card worth the $450 annual fee?
The sign-up bonus, assuming there will be one, has not been announced yet. While this could influence the decision for some, it doesn’t really play a role in whether or not the Starwood Preferred Guest® Luxury Credit Card is worth keeping in your wallet year after year.
In order for this card to pay for itself, you need to spend at least $300 at Marriott and SPG properties per year. The $300 annual statement credit is one of the most generous ongoing perks and the easiest way to offset the annual fee, but it only applies to qualifying purchases made at Marriott and SPG hotels. If you’re not taking full advantage of that perk, the card loses a lot of its value after the first year. Keep in mind that the $300 statement credit doesn’t just apply to your room charge — you can also use it for restaurant, spa, or in-room dining purchases made at a Marriott or SPG hotel.
Additionally, you’ll need to spend enough to make up the remaining $150 in points. With points valued at $0.01 each, here’s what your spending should look like if you want your basic rewards to cover the cost of the card.
- Spend an additional $2,500 at Marriott and SPG properties per year, OR
- Spend $5,000 on dining and flights booked directly with the airline per year, OR
- Spend $7,500 on regular purchases per year
Of course, a combination of the spending above would work as well. For example, an extra $1,000 spent at Marriott and SPG hotels would get you 6,000 points and another $3,000 spent on dining and flights would get you 9,000 points, for a total of 15,000 points valued at $150.
Once the card has paid for itself, the annual free night is easily worth $250+. It can be spent on hotels valued at up to 50,000 points, which includes many of Marriott’s nicest properties in major city centers. Some of these hotels go for $300+ per night.
Finally, the Priority Pass Select membership, which gets you access to over 1,000 airport lounges worldwide, is worth $399. Add in the Global Entry $100 statement credit, and moderate spenders can get a $1,249+ value from this card each year. Even without taking into account the potential sign-up bonus, the Starwood Preferred Guest® Luxury Credit Card offers significant value.
Starwood Preferred Guest® Luxury Credit Card versus Chase Sapphire Reserve®
This new luxury credit card is likely a response to Chase’s incredibly popular Chase Sapphire Reserve®, which is also a premium travel credit card with a $450 annual fee. While they offer similar benefits, there are some key differences.
The biggest difference is the points you’re earning. While the Starwood Preferred Guest® Luxury Credit Card earns points that can be redeemed through Marriott’s international loyalty program, the Chase Sapphire Reserve® earns Ultimate Rewards points. Chase Sapphire Reserve® cardholders can redeem points for an additional 50% value through their Ultimate Rewards, or they can transfer them to 11 different travel partners, making the points offered by the Chase Sapphire Reserve® much more flexible than those offered by the Starwood Preferred Guest® Luxury Credit Card.
The earn rate does offset this a little. While both cards offer 3 points per $1 spent on dining and travel, the Starwood Preferred Guest® Luxury Credit Card offers 2 points per $1 on regular spending. Chase Sapphire Reserve® only offers 1 point per $1 on regular spending. If you plan to do a lot of spending on these cards that doesn’t code as travel or dining, the Starwood Preferred Guest® Luxury Credit Card might offer more value.
Finally, the $300 statement credit offered by the Starwood Preferred Guest® Luxury Credit Card can only be applied to purchases at Marriott or SPG hotels. On the other hand, the $300 travel credit offered by the Chase Sapphire Reserve® can be applied to almost any travel purchase.
The announcement of the new Starwood Preferred Guest® Luxury Credit Card is an exciting one for folks who regularly stay at Marriott or SPG hotels. Even if you only stay a few times each year, this card can easily pay for itself. With high value perks such as airport lounge access and free Boingo Wi-Fi, frequent travelers will get a lot out of this premium travel credit card.
View more information: https://www.fool.com/the-ascent/credit-cards/articles/starwood-preferred-guest-luxury-credit-card-worth-450/