Maximizing Your Starwood Preferred Guest Points: Part Two (Flights and the “Hidden Gem”)

Aug 16, 2012

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SPG points are generally considered the most valuable points out there.  I very much agree with that statement, but I think it is important for anyone who is interested to understand exactly why they are that valuable.  This is important both because everyone’s travel desires are different so value is relative, and they are only the most valuable if you know how to maximize redemptions to get as much value as possible from them.

In part one of this series I looked at maximizing the value of SPG points on hotel reward night redemptions.  Hotel reward nights are actually the way that I use the majority of my SPG points, but I know many folks prefer to use their miles and points for air travel, so this post will focus on that type of option.  In fact, one of the “hidden gems” of the SPG program actually involves both frequent flyer miles and hotel reward nights!

Transfer to Airlines with 5,000 Mile Bonus:

Probably the most common way to use SPG points as airline miles is to transfer them to airlines with a bonus 5,000 miles added for every 20,000 miles transferred at a time.  What that means is that even though you are only earning 1 point per dollar on most charges on the SPG card, you are actually earning 1.25 miles per dollar if you plan to transfer to airlines in increments of 20K to get the 5K bonus.  This makes the SPG the most valuable card to use to for everyday spending to earn some types of airline miles, like American Airlines miles.

There are some downsides to this method.  First, you need to make sure that your airline of choice is a transfer partner.  Second, you need to make sure that the points transfer at a 1:1 to your desired airlines.  Many airlines do transfer 1:1, but there are some key airlines that have less favorable transfer rates.  Some airlines that are available on a 1:1 ratio include: American Airlines, British Airways, Delta, and Hawaiian Airlines.  You can view the full list here.  I do want to point out that United Airlines actually transfers at a 2:1 ratio, so I would not recommend that transfer rate.  A final major downside to this method is that the miles do not transfer immediately, so that can be a challenge if you are transferring with a specific redemption in mind.  We all know that award availability can change very rapidly, so the award you have your eye on might disappear before your miles appear in your frequent flyer account.  I would utilize airline award hold policies when possible here.

Some airlines also occasionally have transfer bonuses when transferring hotel points in to their programs, so it is possible that the transfer rate can become even more lucrative.  For example, a couple of months ago US Airways offered a 50% transfer bonus for all hotel points.  That meant that 20,000 SPG points convert to 25,000 US Airways miles (with the 5K bonus).  Then those 25,000 US Airways miles become 37,500 US Airways miles with the 50% bonus.  Turning 20,000 SPG points into 37,500 airline miles isn’t too shabby.

Nights and Flights – the “hidden gem” of the SPG program:

I think that SPG “Nights and Flights” is the most under-discussed gem of all SPG point redemption options.  Nights and Flights allow you to redeem SPG points for a combination of frequent flyer miles and hotel nights.  It’s kind of like a vacation package of sorts using points.  With Nights and Flights, you can redeem 60,000 SPG points for 50,000 airline miles plus five free nights at a Category 3 hotel or resort.  With Nights and Flights II, you can redeem 70,000 SPG points for 50,000 airline miles and five free nights at a Category 4 hotel or resort.

Let me put this deal another way…you can use the 70,000 points to not only get five free nights at a Category 4 hotel or resort (normally 10,000 points per night), but you also get 50,000 airline miles.  If the hotel you want is in the US or Canada, that means that you and your partner can use the 50,000 miles to each fly for free on an airline like American Airlines, and then have five free hotel nights at your destination.  That is incredibly valuable from just two credit card sign-ups!  Again, I think this truly is the “hidden gem” of all SPG redemption options.  I hope to use it myself in the near future.

Nights and Flights are only available for Category 3 and 4 hotels, they must be requested at least 14-30 days in advance (depending on the airline of choice), and the selected airline must have a 1:1 points transfer option from SPG.

SPG Points as Cash for Airline Tickets:

While this is not how I would choose to use my SPG points, as I find other redemptions more valuable, you can use your points essentially as cash to pay for airline tickets on 380 different airlines without any blackout dates.  If used this way, then you are redeeming your points for less than 1.5 cents each, depending on the cost of the airline ticket.  One benefit of this redemption option is that the airline tickets you purchase with your points would be eligible to earn frequent flyer miles in most cases.  It is nice to know that this option is available, but due to the very limited return for your SPG points, I would not recommend routinely using this option.

Now you know the basics surrounding using SPG points to fly!  Even if you never plan to use your points in that manner, it is good to know what options exist so that you can make informed decisions about what makes the most sense for you and your family when it comes time to redeem your points.

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