More digging under the hood of Choice Privileges

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The difficult thing about writing about Choice Privileges is that they have so many properties it can be tough to know precisely where to focus: the 6,000-point Quality Inn in Wilsonville, Oregon, the 30,000-point Port Inn Kennebunk in Maine, the 35,000-point Quality Hotel View in Malmo, Sweden, or the 55,000-point "Preferred Hotels & Resorts" Myconian Naia in Mykonos, Greece?

That being said, let's see what we can say about the value proposition of the program as a whole.

The Choice Privileges Visa Signature Card has a strong earning rate on unbonused spend

Barclaycard used to issue Wyndham Rewards credit cards that earned two points per dollar spent everywhere. Before 2015, that wasn't particularly remarkable: Hilton Honors cards earn 3 points per dollar spent everywhere, Marriott Rewards cards will soon offer 2 points per dollar spent everywhere, and so on. The important question is always a card's earning rate compared to the cost of redemptions you actually want to make. But in 2015, that changed: all Wyndham properties now cost 15,000 points per night, which means legacy cardholders can stay at any Wyndham in the world for just $7,500 in unbonused spend.

While Choice Privileges isn't as generous as Wyndham, they do have a "flatter" rewards structure than many other programs:

  • a bottom-tier Choice Privileges property costs 6,000 points, or $3,000 in unbonused spend, while a bottom-tier Hilton property costs 10,000 points ($3,333 in unbonused spend) and a bottom-tier Marriott property costs 7,500 points ($3,750 in unbonused spend).
  • a top-tier standard Choice property, which I consider the equivalent of a mid-tier Hilton or Marriott property, costs 35,000 points, or $17,500 in unbonused spend, while a mid-tier Hilton property costs 40,000-60,000 points ($13,333-$20,000 in spend) and a mid-tier Marriott property costs roughly 30,000 points ($15,000 in spend).
  • the most expensive Preferred Hotels & Resorts properties cost 55,000 Choice Privileges points ($27,500 in spend), while top-tier Hilton properties cost 95,000 points ($31,667 in spend) and peak top-tier Marriott properties will eventually cost 100,000 points ($50,000 in spend).

I want to note that in this analysis I'm actually tilting the playing field slightly away from Choice. There are New York City properties (in Brooklyn, not New Jersey) that are bookable today for 6,000 Choice Privileges points per night, and in Manhattan for as little as 12,000 points per night. Neither Marriott nor Hilton offer anything like those rates, with Marriott starting at 35,000 and Hilton starting at 70,000 points per night.

Earnings on paid stays are relatively weak

The Barclays Choice Privileges Visa earns 5 points per dollar spent at Choice Privileges properties, or 2.5 times the unbonused earning rate. Compare that to:

  • 4 points per dollar spent at Hyatt properties with the Chase World of Hyatt credit card (4 times the unbonused rate);
  • 12 points per dollar spent at Hilton properties with the American Express Hilton Honors Ascend card (4 times the unbonused rate);
  • 6 points per dollar spent at Marriott properties with the Marriott Rewards Premier Plus and Starwood Preferred Guest credit cards (3 times the unbonused rate).

Unless you're fully committed to Choice Privileges as your primary hotel program, you're almost certainly better off putting paid stays on a more valuable card like a Chase Ink Plus that earns 2 Ultimate Rewards points per dollar spent on hotel stays, or charging your paid stays to a cashback card like the Bank of America Travel Rewards card with Platinum Honors Preferred Rewards status.

Choice is currently running a timeshare scam you might want to get in on

Like many hotel chains, Choice operates a "vacation ownership" (timeshare) company as well, and you can redeem your Choice Privileges points at those properties. They're currently running a promotion at 6 of those properties where you can redeem 16,000 points for a two-night stay (which would otherwise cost 32,000 points) and receive a $50 MasterCard gift card, in exchange for sitting through a 2-hour sales pitch and going on a tour.

I don't see any limitations on participation (as long as you're 25 years old), so I think you could theoretically visit all 6 properties at the discounted rate and earn $300 in gift cards for your trouble.

Conclusion

Choice Privileges is the first program I've considered adding to my travel hacking practice in a long time. I've mostly been happy using a combination of Chase Ultimate Rewards, US Bank Flexpoints, and Hilton Honors for virtually all of my travel. However, I think adding Choice Privileges to my arsenal will help fill in the gaps where Hyatt properties aren't available and Hilton offers only their standard 0.5 cent per point redemptions, allowing me to save those points for higher-value luxury redemptions.

I'm not terribly impressed with most of Choice's brands, but even focusing exclusively on their Ascend and Cambria hotels, putting $10,000 or so per month of spend on their no-annual-fee co-branded credit card will open up access to a vast number of properties offering outstanding imputed redemption values. Fortunately, I've always had a good relationship with Barclays, so I'm optimistic I won't have any trouble getting approved with a decent credit line.

Is there any value in the latest crop of new credit cards?

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[edit 5/14/18: added unlimited Priority Pass Select membership to list of Ritz-Carlton card benefits.]

Several banks have let out a steady trickle of new credit cards and announcements in the last few months, so I thought I'd run through a few of them and see if there are any offers worth signing up for or keeping.

Barclays Arrival Premier

I have had an Arrival Plus card for years, and use it for all my non-manufactured, non-bonused spend, as well as manufacturing spend on it. It has an $89 annual fee, for which you can redeem 8,900 miles as a statement credit. Since it earns a 5% rebate on all the miles you redeem, it functions as a 2% cash back card when you spend "about" $85,000 per year, since when you redeem those 170,000 miles you'll earn 8,500 in rebated miles and another 425 rebated miles when you redeem those, for a total of $89.25 in rebated miles. I also use the card's chip-and-PIN functionality to buy public transit tickets overseas, and Barclays recently added a flight delay benefit.

The new Barclays Arrival Premier has a number of differences from the Arrival Plus:

  • $150 annual fee;
  • no rebate on redeemed miles. Instead, earn 15,000 bonus miles when you spend $15,000 per cardmember year, and another 10,000 bonus miles when you spend a total of $25,000 per cardmember year;
  • $100 Global Entry fee credit every 5 years;
  • transfer miles to airline partners (Aeromexico, Air France/KLM Flying Blue, China Eastern, Etihad, EVA Air, Japan Airlines, Jet Privilege, Jet Privilege, Malaysia Airlines, Qantas).

This card is strictly superior to the Arrival Plus for annual spend between $15,000 and $85,000:

  • at $15,000 in spend, you receive 15,000 bonus miles, which are enough to cover the $150 annual fee;
  • between $15,000 and $25,000, the card acts as a straight 2% cash back card;
  • at $25,000 in spend, you receive another 10,000 bonus miles, which means the card has earned a total of $600 on $25,000 in spend, or 2.4% cash back.

Only for spend in excess of $85,000 will the Arrival Plus's mileage rebate make the return on unbonused spend, after accounting for the annual fee, exceed the Arrival Premier.

Verdict: I'm not in any rush to sign up for the Arrival Premier since it doesn't have a signup bonus and it's not yet possible to upgrade from the Arrival Plus. I assume eventually Barclays will target existing Arrival Plus cardholders with an upgrade offer, which I'll likely take. If you don't have an Arrival Plus yet, the Arrival Premier seems like a perfectly reasonable way to get 2.4% cash back on $25,000 in spend each year, plus serving as a go-to card you can use when traveling internationally.

Starwood Preferred Guest American Express Luxury Card

I think this is the most interesting of the new Marriott Rewards cards that will be available in August, 2018, since it offers a higher earning rate on Marriott and Starwood purchases than the new Ritz-Carlton card, a more valuable anniversary free night award than the new Premier Plus card, and the ability to earn Platinum status after spending $75,000 during the calendar year.

If you spent $75,000 on the card per year, you'd end up paying a $450 annual fee for:

  • a free night award worth up to 50,000 points;
  • 150,000 Marriott Rewards points;
  • $300 in statement credits against purchases at Marriott and Starwood properties, which should include room charges;
  • Platinum status;
  • and an unlimited Priority Pass Select membership.

Assuming you are able to redeem your free night award at a Category 6 or off-peak Category 7 property each year, your $75,000 in spend will earn the equivalent of 200,000 Marriott Rewards points, or 2.67 points per dollar. That's not quite as good as the Starwood Preferred Guest American Express card currently earns (3 Marriott Rewards points per dollar), but it does reduce the devaluation from 33% to just 11%.

Verdict: this card is too expensive to bother with for a leisure travel hacker, but a reimbursed business traveler who can choose their own hotel, and can therefore redeem the $300 statement credit for their employer's cash, might consider manufacturing up to $75,000 in order to enjoy Platinum status on a 4-night, off-peak Category 7 vacation starting in 2019.

Ritz-Carlton Rewards Credit Card

This card also has a $450 annual fee, but with almost nothing to show for it:

  • a $100 statement credit on two-night paid stays at the Ritz-Carlton;
  • 3 annual Club Upgrades on paid stays;
  • a $300 travel credit;
  • Platinum status after spending $75,000 per account year;
  • and an unlimited Priority Pass Select membership.

It's important to note that even if you're a reimbursed business traveler, and even if you spend $75,000 per year at Marriott Rewards and Starwood properties each year, you should be using the Starwood Preferred Guest Luxury Card for that spend since it earns 6, rather than 5, points per dollar spent on those purchases. Using the Ritz-Carlton Rewards card would be leaving 75,000 points on the table.

I know families that love using Club Upgrades to save money feeding their kids when staying at Ritz-Carlton properties, but even if you are able to cash out the $300 travel credit, there's no way I'd be willing to pay $150 to pre-commit to a paid stay at a Ritz-Carlton every single year.

Note that, as is typical for Chase, the Ritz-Carlton card's Platinum status qualification is based on cardmember year spend, not calendar year spend, while typically for American Express, the Starwood Preferred Guest Luxury Card awards Platinum status based on calendar year spend. That means if you sign up for the Ritz-Carlton card for a signup bonus and decide to hit the $75,000 spend threshold to get Platinum status, you'll want to meet the spend requirement early in a calendar year, which should get you Platinum status for the remainder of that year and all of the following year.

Verdict: skip it — nothing to see here.

Marriott Rewards Premier Plus, Starwood Preferred Guest Credit Card, and Starwood Preferred Guest Business Credit Card

In addition to the two ultra-premium cards, Chase is also launching a new Marriott Rewards-branded card with a $95 annual fee and an annual anniversary free night award worth up to 35,000 points, and adding that benefit to the existing Starwood Preferred Guest consumer and business credit cards.

On its own these card aren't very interesting, since Marriott is the worst offender in terms of category creep, seemingly deliberately targeting the few valuable properties where free night certificates can be redeemed and moving them out of the eligible redemption categories, so I would never pay $95 for what's essentially a Category 5 free night certificate (or Category 4 peak season award).

However, one strategy that could make sense for some people is to combine one, two, or three of these cards with the Starwood Preferred Guest Luxury Card mentioned above. If you carried all four cards and spent $75,000 per year on the Luxury card, you could pay $735 in annual fees and $1,500 in opportunity cost (assuming a 2% cash back alternative) for:

  • 150,000 Marriott Rewards points;
  • 3 35,000-point free night awards;
  • 1 50,000-point free night award;
  • and Platinum status.

The point is simply that once you've manufactured Platinum status with the Luxury card, you should value the free night awards earned by the other 3 cards more highly than before. A 35,000-point free night award might not be worth $95 with Silver status, but might be worth $95 with Platinum status. Likewise one 35,000-point free night award might not be worth $95, but 3 might be worth $285 (if you can avoid moving hotels or paying cash to stay in the same hotel), and if so, then they should be even more valuable with Platinum status.

Verdict: whether or not stacking free night awards with Platinum status is worth the time and trouble is going to depend on how properties shake out into Marriott's new hotel categories. If, as I suspect, the most appealing city properties start in or quickly move into Category 6 and above, then the 35,000-point free night awards offered under the new program will be as worthless as the Category 5 awards they hand out today are.

Bonus: don't forget to cancel your Citi AAdvantage cards!

Not a brand new credit card, but a few days ago Citi e-mailed to tell me that:

"As a valued cardmember, soon you’ll automatically earn 2X miles at restaurants and at gas stations with the Citi / AAdvantage Platinum Select World Elite Mastercard.

"You’ll also be able to earn a $100 American Airlines flight discount after you spend $20,000 or more in purchases during your card membership year and renew your card. Your purchases on or after ‌July 22‌, ‌2018‌, qualify toward meeting the minimum spend requirement to receive this benefit."

I didn't have to scroll very far down to also see, "The annual membership fee for this card will be increasing to $99."

The card wasn't worth keeping at $95, so don't let them squeeze another $4 out of you!