Choosing The Right Hilton Credit Card

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After his first post about the basics of double-dipping with Hilton HHonors, TPG contributor Nick gives us the breakdown of the three Hilton credit cards on the market and which one might be right for you and your needs (just in case you have trouble deciding, there’s another one of his famous Excel spreadsheets to help you figure it out).

In the past couple years Hilton has devalued their program several times, but there’s still tremendous value to be had if you maximize your earning and redeeming of Hilton points. While redemption levels seem high (50,000 points for a top tier hotel) the base earning of Hilton points is higher than most other programs at 15 HHonors points per $1 you spend at Hilton as opposed to just 2 Starpoints per $1 at Starwood. Points earning increases exponentially when you take advantage of Hilton’s co-branded credit cards.

Currently, there are three different Hilton cards out there:
-Citi Hilton HHonors Visa Signature
-Hilton HHonors American Express: The current sign up offer for the American Express Hilton HHonors card is 50,000 points when you spend $750 in the first 3 months.
-Hilton HHonors Surpass Card from American Express

Benefits Breakdown

Citi Visa Signature

American Express

Surpass

Current bonus point offer

40,000 points after $1000 spend in first 4 months

40,000 points after $750 spend in first 3 months

40,000 points after first purchase, additional 20,000 points after $3000 spend in first 3 months

Annual Fee

None

None

$75

Earning Power

Hilton Properties

6 points/$1

6 points/$1

9 points/$1

Supermarkets, gas stations, drugstores

3 points/$1

6 points/$1

6 points/$1

Phone, cable, satellite, and internet bills

2 points/$1

6 points/$1

6 points/$1

Everything else

2 points/$1

3 points/$1

3 points/$1

Automatic Complimentary Status

Silver

Silver

Gold for first year, Silver thereafter

Status with Annual Spend

None

Gold after $20,000

Gold after $20,000

Diamond after $40,000

Spending Comparison

So what does this look like in action? Let’s look at a hypothetical situation of someone who spends $1650 a month on the card:

$400/month at Hilton properties
$200/month on gas
$600/month on groceries
$50/month on pharmacy purchases
$200/month on phone/cable/satellite/internet bills
$200/month on other purchases

After a year of these spending habits, here is the earning potential:

Citi Visa Signature

American Express

Surpass

Max sign-up bonus

40,000 points

40,000 points

60,000 points

Hilton properties

28,800 points

28,800 points

43,200 points

Gas

7200 points

14,400 points

14,400 points

Groceries

21,600 points

43,200 points

43,200 points

Pharmacy

1800 points

3600 points

3600 points

Bills

4800 points

14,400 points

14,400 points

Other

4800 points

7200 points

7200 points

TOTAL POINTS IN FIRST YEAR

109,000 points

151,600 points

186,000 points

You can see how the bonus categories can significantly change your earning potential, depending on which card you carry.

The Surpass Card obviously excels in the spend bonus on dollars spent at Hilton properties and the sign-up bonus even though you have to spend four times as much as on the regular Hilton Amex to get those extra 20,000 points. Otherwise the two Amex cards are neck and neck, while the Citi Visa Signature lags in the category bonuses, though the 40,000-point sign-up bonus is just as big as the regular Hilton Amex.

Rewards
Free nights begin at 7,500 points for a Category 1 hotel (like the Hampton Inn Enterprise, AL) and go up to 80,000 for certain Waldorf Astoria properties during high season (like the Grand Wailea Resort). This means that if you sign up today for the Hilton HHonors Surpass American Express and spend $1650/month as outlined above, you will have enough points for two free nights at Grand Wailea or 24 free nights at the Hampton Inn in Enterprise after one year, so the spending bonuses really do add up. Whereas if you spent the same monthly amount with the Citi Hilton card, you’d have enough for 14 nights at the Hampton Inn, and just one night at the Grand Wailea in high season.

Cardmember Redemption Benefits
There are two ways to book discounted reward stays at Hilton properties, however, and this is where being a cardholder really pays off.

VIP-only rewards (also known as GLON):
Regardless of the card you choose and the amount you spend, you will automatically have Silver status with Hilton HHonors. This means that you have access to discounted redemption rates for stays of four nights or longer at Category 3 or higher hotels. The discounts are as follows:

-Four-night stay: 15% off standard reward rate
-Five-night stay: 20% off standard reward rate
-Six-night stay or longer: 25% off standard reward rate

As a Hilton HHonors Diamond member you can book a six-night stay at the Conrad Bali that would cost the general member 210,000 points (35,000 points/night), whereas a Diamond member could get it for 157,500 points (26,250 points/night).

Amex-only rewards (also known as AXON): If you choose either one of the American Express options, another discounted redemption opportunity exists specifically for cardholders. This allows you to book four-night stays at specific rates that (in many cases) are discounted even more than the VIP-only rewards.

Here’s how it works:

-Category 5/6 hotels (AXON5/AXON 6): 125,000 points for a four-night stay (instead of the usual 140,000 for Category 5 and 160,000 for Category 6)
-Category 7 hotels (AXON7): 145,000 points for a four-night stay (instead of the usual 200,000)

Surprisingly enough, the AXON5 rate of 125,000 points is actually higher than the GLON rate of 119,000 points, so if you are planning a four-night stay at a Category 5 hotel, you’re better off booking the GLON rate. However, the other two AXON rates do offer significant savings compared to the GLON rate at Category 6 and 7 properties. You’d save 11,000 points for a four-night stay at a Category 6 property (125k compared to 136k) or 25,000 points for a four-night stay at a Category 7 property (145k compared to 170k).

Confused yet? Don’t worry. I’ll be writing a future post demystifying GLON and AXON awards that will cover these options in greater depth, including a comparison between when you should use GLON and when it’s better to use AXON if you’re a cardholder.

Which Card Is Best?
So what does this all mean for you? When push comes to shove, the Hilton HHonors American Express clearly outshines the Visa Signature, which makes it a no brainer to me. It offers better category bonuses and access to both the discounted redemption rates discussed above while still avoiding an annual fee. It can also be a great card for those new to the points game that may not want to mess with the likes of the American Express Platinum.

The Surpass card, on the other hand, is a no brainer if you can get Diamond status via the $40,000 in spend and it may be a better choice for those with significant spending at Hilton properties each year. Since most of my paid Hilton stays are charged to my company, the $75 annual fee isn’t worth it for me. Unless you really need the extra 20,000 bonus points right off the bat, it may be worth applying for the fee-free Amex now and upgrading if/when they offer additional bonus points.

However, it is worth noting that as a fee-free cardholder, I get a solicitation about once a month to upgrade to the Surpass card. In fact, the most recent one was a few weeks ago, offering an additional 50,000 bonus points for spending $3000 in the first three months. Until they offer to waive the annual fee or until I am desperate for Hilton HHonors points, I’m not budging!

To help you determine which card is right for you, I’ve created an Excel spreadsheet where you can plug your finances in to see how many points you’d earn on each card. You can find it here: Hilton HHonors Credit Card Spending.

No matter which card you choose, there are certainly ways to maximize your points earning and redeem for the hotel awards you want. Feel free to leave your comments and questions below on which card might be best for you and why.

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