Among the frequent traveler community there is one credit card that has obtained almost mythical status, the Starwood Preferred Guest® Credit Card from American Express (a Money Crashers partner).
Let’s look at all the details of this card, and then you might understand why nearly all of the top collectors of frequent flyer miles use this card wherever it is accepted.
For every dollar spent on this American Express card, you will receive a single Starpoint in the Starwood Preferred Guest Program. These points can be redeemed for hotel stays (Starwood operates Westin, Sheraton, and other boutique hotel brands) or transferred to miles in one of many airlines’ frequent flyer programs. There is an annual fee of $65 that is waived your first year.
At first glance, the Starwood Preferred Guest® Credit Card from American Express seems to be a run-of-the-mill American Express rewards card in which you collect Starwood hotel points or frequent flyer miles rather than points in Amex’s Membership Rewards program. But there are three reasons why it stands out from the pack.
1. The Strength of Starwood
The strength of this card lies in the fact that the Starwood Preferred Guest Program is no ordinary hotel program. For starters, Starwood hotels allow you to redeem points for any available hotel room with no blackout dates and no capacity restrictions. If they have a room left for sale, you can redeem a reward for it.
Furthermore, their redemption rates are very reasonable. Lower-end Sheraton and Four Points hotels can be redeemed for 3,000 to 7,000 points per night, while the high-end Westin hotels offer rooms for 7,000 to 14,000 points. When you stay five nights, your fifth night is free, further reducing the average cost per night by 20%. By comparison, other major hotel loyalty program can charge 10,000 to 20,000 points per night for low-end hotels while restricting award availability.
2. Flexible Transfers to Miles
Beyond hotels, Starpoints are extremely valuable to people who collect frequent flyer miles due to their transfer options to dozens of airline partner programs. Let’s say you’re a few miles short of a reward with your favorite airline, and you have some Starpoints available. You can quickly transfer your Starpoints to their program to top off your account and redeem the reward. Most transfers are 1:1 and there is never a fee.
In addition, every time you transfer 20,000 Starpoints to airline miles, Starwood gives you another 5,000 Starpoints as a bonus. In effect, you are actually earning 1.25 airline miles for each dollar spent, which is usually greater than the accrual rate of the airline’s own branded card. Savvy travelers will accumulate large quantities of Starpoints and then find the airline that offers the award they want and reserve it. Only then will they transfer the Starpoints to miles. In this way, you can maximize the value of Starpoints to a greater extent than is possible when earning points with a single loyalty program where your desired award may or may not be available.
3. Starwood’s Excellent Customer Service
Starwood is the rare travel company that actually offers unsurpassed customer service. They have a strong presence on social media sites and they respond promptly to inquiries and complaints communicated through any medium. Every time I have had reason to contact them, I have been more than impressed with their response and resolution (without resorting to stingy customer service strategies).
While the Starwood Preferred Guest card’s benefits exceed that of any regular credit card, it does have some of the same drawbacks of most other credit cards.
1. High Interest Rate
This is a rewards card, and like any rewards card, it should only be used by people who are consistently paying their entire balance in full and on time. Those carrying a balance should consider a credit card with a lower APR such as the Promise card from PenFed.
2. Large Annual Fee
While waived the first year, the $65 annual fee that comes with this card is significant. As a result, this card may only make sense for people who are willing to use this card for all of their day-to-day purchases.
3. Foreign Transaction Fee
Amex continues to charge a 2.7% foreign transaction fee on all purchases processed outside of the United States. This fee remains on their Starwood credit card even though it has been waived on their higher-end cards such as the American Express Platinum. This unjustified fee offers no value to the customer and is a complete waste of money. It is for this reason that when using credit cards in foreign countries, Amex is now the card you should leave home without.
4. American Express Is Not Accepted Everywhere
While you should never rely on just one credit card, this advice is even more relevant if you hold an American Express card. Expect this card to be rejected by some percentage of the merchants you present it to. Carry a Visa or a MasterCard as a backup.
Beneath the cloak of a good, but ordinary hotel card lies a super-card capable of earning miles in all the major airline programs around the world. Because of this, the Starwood Preferred Guest® Credit Card from American Express is in the wallet of every serious traveler and rewards blogger I know. If you are a member of several different frequent flyer programs, and are always searching for reward travel space, this is the card that you need to have.
What are your thoughts on the American Express Starwood Preferred Guest credit card? Share your experiences in the comments below.