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Reader Matt asked the following question on the “Ask Lucky” page of the blog:
Do you ever use your AMEX Starwood card for foreign Starwood stays? I’m trying to figure out if the foreign transaction fee is worth the extra points I’ll get. If it’s not worth it… I’ll just use my Chase Sapphire card.
While most credit card bonus spend categories are pretty straightforward, the math indeed gets a bit tricky on foreign Starwood stays.
I love the Starwood Preferred Guest® Credit Card from American Express. It was actually one of the first credit cards I applied for when I turned 18, and I haven’t canceled it yet.
I personally value Starpoints at 2.2 cents each, so for non-bonused, daily spend it offers among the best return of any card out there, in my opinion (along with the Barclaycard Arrival™ World MasterCard® and Club Carlson Premier Rewards Visa Signature® Card, as I covered in my post about the best credit cards for everyday spend).
The Starwood Preferred Guest® Credit Card from American Express does offer double points on Starwood stays, so you’re theoretically earning what I value at a 4.4% “return” on spend. The only catch with this card is that it has a 2.7% foreign transaction fee, so when you subtract that from the 4.4% “return” (based on my valuation), that’s a “return” of just 1.7%.
You’d be much better off putting your foreign hotel spend on the Chase Sapphire Preferred® Card, which offers double points on travel so 2 points per dollar spent.
Beyond that, there are no foreign transaction fees. I value Ultimate Rewards points at ~1.6 cents each, so that’s a return of ~3.2%.
If you don’t have the Chase Sapphire Preferred® Card, the Ink Plus® Business Credit Card or Ink Bold® Business Charge Card will do the trick as well. They offer double points on hotel stays, so that’s the equivalent of a ~3.2% return.
So while you’re better off using one of the above cards for foreign Starwood stays, ironically the best card to use for most domestic Hyatt stays is actually the Starwood Preferred Guest® Business Card from American Express.
That’s because Hyatt participates in the OPEN Savings program, whereby you receive a 5% discount for Hyatt stays of up to $10,000 per year when paying with your American Express OPEN Card:
OPEN Savings® from American Express OPEN
Hyatt Hotels & Resorts® boosts the value you get from your Business Card from American Express OPEN as part of the OPEN Savings® benefit. As a built-in Business Card feature, you automatically receive a 5% discount credited to your American Express statement OR 2 additional Membership Rewards® points for each eligible dollar spent at participating Hyatt Hotels & Resorts in the U.S. up to $10,000 per Card Account in a calendar year. This benefit can be combined with other promotions offered by Hyatt.
So between the 5% cash back and the one Starpoint you’re earning (which I value at 2.2 cents), that’s a return of 7.2% on Hyatt stays… using a Starwood Business Credit Card!
I have gotten my fair share of evil looks from Hyatt front desk associates when using a Starwood credit card, though. 😉