Understanding Rewards-Based Cards for Hotels

[cardio_guy]

Looking beyond cashback cards, rewards cards offer benefits like hotel memberships, and free stays. Let's break down how these work for hotel memberships and free stays:

Obtaining Memberships and Free Stays​

• Joining Fees: Some cards offer a free night's stay voucher or coupon when paying the joining fee.
• Membership Levels: Certain cards come with memberships like gold or platinum, granting discounts and benefits. That means, if you get the card, you also get platinum membership in one of the hotel chains for an year.
• Free Stays:
  • Spend-Based: Some cards offer a free night's stay for spending a certain amount annually. Like hitting certain spending thresholds, e.g., ₹2 lakh in a year.
  • Annual Fee: Others provide a free stay when paying the joining or annual fee. Straight voucher that you can redeem while booking hotels.

Reward Points​

• Hotel Partnerships: Many cards have partnerships with hotel chains, offering accelerated reward points for certain hotel spends. For other spends, you get normal reward points.
• Point Conversion: You can convert these points into hotel loyalty points (e.g., Marriott Bonvoy or Accor points) and use them for bookings.
• Conversion Rates: Conversion ratios vary between cards and banks, affecting the value of your points.
• Value Comparison: Rewards cards often offer better value than cashback cards (5-10%), especially for frequent travellers or those with specific spending patterns.

Reward multiplier, accelerated rewards, and spend limit based rewards

• Some cards gives you 10x rewards if you spend it on their specific platforms.
• Some cards give accelerated rewards for some categories of spends, or specific dates etc.
• Some cards give free points when you reach some limit - like 1000 points free for reaching 1L spend in one month.

Key Considerations​

• Upfront Benefits: I find cards offering free stays with joining or annual fees advantageous.
• Spend-Based Rewards: Some cards that offer free stays for reaching annual spending limits are also valuable.
• Point Accumulation: Earning and converting points to hotel points provides flexibility but requires more tracking.
• Point Expiry: Make a note if these points or vouchers expire within a year or so. Some of them have expiry dates and validity restrictions.

Some Major hotel chains to consider: ITC, Marriott, Accor, Taj
I think even if you only visit these luxury hotels once a year for vacation, it's worth experiencing.

There are many existing TF Wiki posts and Informative threads about this and specific cards and hotels.

Which type of card do you prefer for hotel stays? Can you suggest some good options in these categories?

I'll write about air miles in the next post. (Trying to understand and simplify reward cards for my own reference, if there are any mistakes, please do comment.)

 

[cardio_guy]

Adding @helloworld, @SSV, @Subhankar for views and inputs.