When you’re planning a trip, one of the big decisions you make is where you’ll stay. Accommodation options include motels, hotels, and resorts, as well as vacation rentals.
Your priority might be saving money when you book a hotel or lodging. If so, there are different options available. You can book vacation packages that roll the cost of the hotel into the other costs of your trip, and you get a discount for booking them altogether. You might also look for discount codes or special offers.
For some frequent travelers, another option is getting a hotel-branded credit card, although there’s some question as to whether or not these cards are worth it. In many cases, they aren’t, although they might have value for a limited number of people.
Below, we talk more about hotel credit cards and what you should know before applying or using one.
What Are Hotel Credit Cards?
Hotel credit cards are also known as hotel-branded cards.
The general idea of a hotel-branded card is similar to an airline-branded card and other travel cards.
With travel credit cards, you earn miles or points that can then go toward reduced-cost or free trips and vacations.
A hotel credit card will earn you points with the hotel brand or chain for every dollar you spend. The points then collect in the hotel loyalty program associated with the card’s affiliation. Every hotel credit card will award points at different rates. Most often, you’ll earn an award of one point per dollar spent on the majority of purchases.
Some cards will then allow you to earn bonus points in certain categories of spending. In nearly all cases, you’ll earn the largest amount of bonus points when you use the card at the properties it’s associated with.
You take the points you earn and redeem them not only for hotel stays but also room upgrades and other perks.
Most hotel-branded cards come with an annual fee.
When you apply and then sign up for a hotel card, you link your hotel loyalty account. A loyalty program is free.
What Are the Potential Benefits of These Cards?
There’s a lot of variance in the specific benefits of a hotel credit card, depending on the companies involved and the card itself. Generally, some of the benefits a cardholder might expect include:
- Automatic elite status—a lot of hotel loyalty programs have elite status tiers, which are usually awarded based on how many nights you spend at the properties making up the chain. The more you stay, the more status you earn. If you want to get there faster, you might get a branded credit card. When you have elite status, you could receive upgrades, free breakfast, or waived resort fees.
- Free nights—some cards exchange a free night at property when you sign up for a card, and in other cases, you might get them on your anniversary as a cardholder.
- Statement credits—if you use the card at certain brands, you might get a statement credit to use as a rebate.
- Travel insurance—if you have to change or cancel your trip, having travel insurance can provide you with financial protection and potential reimbursement.
Are These Cards Worth It?
Things to consider as you weigh whether or not a hotel card is worth it include:
- Do you pay your full balance every month? If not, you’re going to end up paying more interest charges and maybe even late fees than the value of the points and perks will be for you.
- What’s the annual fee? If you weigh whether or not a card is right for you, think about the value of the perks and make sure they’re greater than the annual fee. If the card doesn’t have an annual fee, that’s better, so you don’t have to think about offsetting it in other ways.
- What are your spending habits like? For example, does the card have bonus categories that allow you to earn more points, and if so, are these in line with your spending habits? You don’t want to spend more than you would ordinarily to try and earn credit card rewards.
- How often do you stay at properties affiliated with the brand? Some cards will offer you options to earn general travel rewards, which might be better for you. If you’re staying at different hotel brands, or you like vacation rentals, a hotel card isn’t likely to be worth it.
- Will you have to pay a resort fee? If you’re booking Marriott, for example, and it has a resort fee, you still have to pay that in some cases, which can be much more than any rewards are worth.
- What are the destinations you’re likely to go to in the future, and will they offer accommodations that are in line with the card?
- Do you already have similar perks with an existing card?
If you do decide to get a hotel card, things to look for include:
- A good bonus offer for new cardholders. You should calculate the signup bonus for any card you’re using, and then it can be a great tool for comparison. A healthy signup bonus can give you a good amount of points all at once.
- How will you earn points, and is it feasible for you?
- What are the added perks of the card? One great perk of some travel cards is the ability to get a rebate for the costs of applying for TSA PreCheck. Depending on how often you travel, this can quickly pay for itself.
- Are there foreign transaction fees? How often do you travel abroad?
Overall, for a lot of travelers, a hotel-branded card isn’t the best option because you can usually find good hotel deals online without using points. The times when they can make sense are for frequent travelers or hotel brand loyalists who rarely, if ever, stay outside of a certain chain.
Do the math before signing up for anything to make sure it’s coming out as a net gain for you.