This is the 2nd part of my analysis into which of the UK hotel-branded credit cards are worth keeping for the long-term. If you missed Part 1 yesterday, I recommend that you click here to read it before carrying on.
Today I looking at which cards perform best if you are a big spender, able to put £25,000 per year through your card.
Return for spending £25,000 (25% overseas, 5% with the hotel chain that issues the card):
Compared to our £10,000 spend analysis yesterday, there is no change to the results for the first three cards – Hilton, Marriott, free IHG card – because none of these cards offer a bonus for hitting a spend target (click through the blue links to read my full review of each card):
Hilton HHonors Platinum Visa:
Base spend: 50,000 points @ 0.3p = £150
Extra points on £1250 of Hilton spend: 1250 points @ 0.3p = £3.75
Extra benefit: Spending £10,000 triggers a free Hilton HHonors Gold card
Return to cardholder: £153.75 plus a Hilton HHonors Gold card (0.61% of spend plus the value of HH Gold, this has value as you will receive free internet and free breakfast)
IHG Rewards Club Visa (free version):
Base spend: 25,000 points @ 0.5p = £125
Extra points on £1250 of IHG spend: 1250 points @ 0.5p = £6.25
Fee: nil, you also receive IHG Gold status – this has no real value however
Return to cardholder: £131.25 (0.52% of spend)
Marriott Rewards MasterCard:
Base spend: 25,000 points @ 0.5p = £125
Extra points on £1,250 of Marriott spend: 1250 points @ 0.5p = £6.75
Extra points on £6,250 of foreign spend: 6250 points @ 0.5p = £31.25
Fee: nil, you also receive Marriott Silver status – this has only very modest benefits however
Return to cardholder: £163 (0.65% of spend)
The return on the IHG Rewards Club Black Visa falls. It was a 2.8% return when you spent £10,000 – this is the ‘sweet spot’ because it triggers the free night voucher which is potentially worth £250. Beyond £10,000 of spend, your return falls away. When you spend £25,000:
IHG Rewards Club Premium Visa (paid card):
Base spend: 50,000 points @ 0.5p = £250
Extra points on £1,250 of IHG spend: 2,500 points @ 0.5p = £12.50
Extra points on £6,250 of foreign spend: 12,500 points @ 0.5p = £62.50
Fee: £99, you also receive IHG Platinum status – this has only very modest benefits however
Extra benefit: Spending £10,000 triggers a voucher for a free night at ANY IHG hotel. I assume you use this at an InterContinental for a room worth £250
Return to cardholder: £325 of points + £250 of free night – £99 fee = £476 (1.9% of spend)
The only card to improve its return at £25,000 of spending is the SPG Amex. When you hit £25,000 in a year, you receive a voucher for a free weekend night in a Category 1-4 Starwood property. Unfortunately these hotels are generally poor – not weekend break destinations unless the Excel conference centre is a weekend break target for you! – and I only value the voucher at £75.
Spending £15,000 also triggers a free Starwood Gold card. This has a number of benefits but the only one of real value is free internet (you can choose between a free drink, bonus points or free internet). At £25,000 spend the numbers are:
Starwood Preferred Guest American Express:
Base spend: 25,000 points @ 1.5p = £375
No foreign or SPG spend bonus
Fee: £75, you also receive SPG Gold status – the main monetary benefit of this is free internet
Extra benefit: Free weekend night for £25,000 spend at a Category 1-4 hotel, valued at £75
Return to cardholder: £375 of points – £75 fee + £75 free night value = £375 (1.5% of card spend)
As you can see, even at £25,000 of annual spending, the Starwood Amex delivers £100 less of value (net of fee) than the IHG Rewards Club Premium Visa card. In reality, though, anyone who has the IHG Black card is likely to stop using it when they hit the £10,000 target to trigger the free night and then move their spend elsewhere.
In the US, the Starwood Amex was the best loyalty credit card for many years and it is still very well regarded. With an overhaul it could become a real winner here as well. At the moment, if you want a hotel credit card to hold long-term alongside an airline card you should focus on IHG Rewards Club Premium Visa as these two articles show.
(Disclaimer: Head for Points is a journalistic website. Nothing here should be construed as financial advice, and it is your own responsibility to ensure that any product is right for your circumstances. Recommendations are based primarily on the ability to earn miles and points and do not consider interest rates, service levels or any impact on your credit history.)