Earning Airline Miles for a Hotel Stay — Reader Mistake Story

Apr 18, 2017

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One of the things I love most about being The Points Guy is getting to hear stories from readers about all the positive ways award travel has affected their lives. That being said, while I love hearing about your successes, I think there’s also a lot we can learn by sharing our mistakes, and I’m calling on readers to send in your most egregious and woeful travel failures.

From time to time I’ll pick one that catches my eye and post it for everybody to enjoy (and commiserate with). If you’re interested, email your story to info@thepointsguy.com, and put “Reader Mistake Story” in the subject line. Include details of exactly how things went wrong, and (where applicable) how you made them right. Please offer any wisdom you gained from the experience, and explain what precautions the rest of us can take to avoid the same pitfalls. If we publish your story, I’ll send you a gift to help jump-start your next adventure (or make up for any blunders from the last one).

Today, I want to share a story from TPG reader Joachim, who left a lot of rewards on the table during a recent trip. Here’s what he had to say:

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Joachim opted to earn American Airlines miles instead of Marriott Rewards points for his hotel stays.

I recently enjoyed a paid stay at the Ritz-Carlton in Aruba, which included both award travel successes and failures. After my trip, I noticed my American Airlines AAdvantage account had been credited with several thousand miles. That seemed like good news until I started investigating where those miles had come from.

It turns out that a couple years ago (before the Marriott-Starwood merger), I selected American Airlines miles as my earning preference. That means instead of earning 10 Marriott Rewards points per dollar, I was earning just 2 AAdvantage miles per dollar spent on Marriott stays. While it’s not the end of the world, I figure that I missed out on almost 10,000 AAdvantage miles during my Aruba trip alone by not crediting the stay to Marriott.

The base rate for my room was $4,418, which came to 8,836 AAdvantage miles credited to my account. If I had credited the stay to Marriott instead, I would have earned 44,180 base points. Since you can transfer Marriott points to Starwood Preferred Guest at a 3:1 ratio, that stay would have earned me the equivalent of 14,727 Starpoints, which in turn transfer 1:1 to American Airlines. I could have earned at least 5,891 more miles by going that route.

That total would be even higher if I took advantage of the SPG transfer bonus, which gets you an extra 5,000 miles when you transfer 20,000 points. In that scenario, each Starpoint is worth 1.25 miles, so I would have ended up with the equivalent of 18,409 miles, or 9,573 more than I actually got. Of course, Starpoints would give me the flexibility to transfer to other airline partners as well, not just American.

On the bright side, I saved around $800 on my stay by using the Citi Prestige Card to get the fourth night free. I also flew my family to Aruba using 80,000 TrueBlue points, most of which were earned from the Virgin America points match by way of a Starwood transfer of just 40,000 points. We also got $200 worth of free bags and saved about $30 on in-flight purchases after getting the JetBlue Plus Card at the last minute.

Despite the error, it was a successful trip, and I hope this will help your other readers from making a similar mistake.

Many hotel loyalty programs allow you to earn airline miles instead of points, but it’s rarely a good idea. You’ll earn far fewer miles for each dollar spent, and that disparity in earning rates means opting for miles is generally a losing proposition. As Joachim points out, Marriott offers just 2 AAdvantage miles per dollar spent, which are worth much less than 10 Marriott points based on my latest valuations.

If you’d rather have miles in the end, you may still be better off earning hotel points and then transferring to your frequent flyer program of choice. In this example, banking points to Marriott nets around 65% more AAdvantage miles per dollar spent, and nearly 110% more if you can take advantage of the SPG transfer bonus. Even without the Starwood partnership, you could get a better (or at least equal) rate by transferring directly from Marriott Rewards to American or another airline.

There are a few exceptions. For example, Marriott allows members to earn Southwest Rapid Rewards at a flat rate of 600 points per qualifying stay. That’s a solid option if you score a cheap rate (under around $95) for a single night. Make sure you know how points and miles are awarded for each stay, and set your earning preferences accordingly.

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You’ll usually get better value by transferring Marriott points to airlines (either directly or via Starwood Preferred Guest).

I appreciate this story, and I hope it can help other readers avoid making the same mistake. To thank Joachim for sharing his experience (and for allowing me to post it online), I’m sending him a $200 Visa gift card to enjoy on his travels.

I’d like to do the same for you! If you’ve ever arrived at the airport without ID, booked a hotel room in the wrong city, missed out on a credit card sign-up bonus or made another memorable travel or rewards mistake, I want to hear about it. Please indulge me and the whole TPG team by sending us your own stories (see instructions above). I look forward to hearing from you, and until then, I wish you a safe and mistake-free journey!

Featured image courtesy of The Ritz-Carlton Aruba.

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