Starwood AmEx Vs. Premier Rewards Gold Card From American Express?

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Reader Anne asked the following question in the “Ask Lucky” forum:

We had settled on switching to AmEx Premier Rewards Gold from Platinum but now with the announcement of the new benefits for SPG AmEx we are torn. My instinct is the higher earn on the Gold is more valuable but didn’t know if the larger # of partners on the SPG Amex beat it out. We also have the Chase Sapphire. Thanks for any advice!

It’s an interesting question, especially given that refreshes were announced on both of these cards recently:

With that in mind, which card is a better option, given what we know about Anne’s circumstances?

Comparing the annual fees

The annual fee on the Premier Rewards Gold Card from American Express is $195 (waived the first year), though you receive a $100 airline fee credit each calendar year.

Meanwhile the intro annual fee on the Starwood Preferred Guest® Credit Card from American Express is $95 (waived the first year).

So on paper the SPG AmEx has a lower annual fee, though if you fully utilize the value of the airline fee credit on the AmEx PRG, it’s not a huge consideration point, in my opinion.

For example, I was able to redeem my $100 airline fee credit for $100 worth of American Airlines gift cards, which I value pretty close to face value.

PRG-Airline-Fee-Credit-1

PRG-Airline-Fee-Credit

Comparing the value of points

The Premier Rewards Gold Card from American Express accrues Membership Rewards points, while the Starwood Preferred Guest® Credit Card from American Express accrues Starpoints.

In terms of my valuation of points, I value Starpoints at 2.2 cents each, while I value Membership Rewards points at 1.8 cents each.

Both currencies have their pros and cons.

Starpoints can be converted into airline miles at a 1:1 ratio, and for every 20,000 points you transfer you get a 5,000 point bonus. Starwood also has the most extensive list of airline transfer partners, including programs like Alaska Mileage Plan, American AAdvantage, Japan Airlines Mileage Bank, etc., which other transferrable points currencies don’t give you access to. The downside is that the points don’t transfer instantly, and in some cases can take more than a week.

Membership Rewards has quite a few great airline transfer partners, and fairly regularly even has transfer bonuses. In most cases points even transfer instantly. I value Membership Rewards points slightly less than Starpoints since with Starwood you’re essentially earning 1.25 airline miles per Starpoint, assuming you transfer points in increments of 20,000 points.

Frontier-Membership-Rewards-1

Comparing the return on everyday spend

So the SPG AmEx has a lower annual fee, and Starpoints are more valuable than Membership Rewards points. Why, then, would you consider the AmEx PRG?

Because of the bonus categories the card has. The Premier Rewards Gold Card offers the following bonus categories:

  • 3X points for flights booked with airlines
  • 2X points at US gas stations, US restaurants, and US supermarkets
  • 1X points on other purchases

AmEx-PRG

I guess to crunch the numbers even further, if we’re going to say Membership Rewards points and Starpoints are worth 1.8 and 2.2 cents, respectively, then you’d have to earn at least an average 1.22 Membership Rewards points per dollar spent on the Premier Rewards Gold Card to “break even” in comparison to the Starwood American Express Card.

Given that the AmEx PRG offers bonus points on airfare, dining, gas, and groceries, you probably have a good shot of coming out ahead using that card. However, if you have a ton of non-bonused spend, you’d probably come out ahead using the SPG AmEx.

Bottom line

These are both cards I have, and both cards that I think are worth holding onto long term. The fact that the SPG Business AmEx now offers lounge access at Sheraton properties is a perk which will justify the card for many in and of itself. Heck, I hold onto my Starwood credit card exclusively for the two elite stay credits and five elite night credits I get towards Starwood status every year.

But given Anne’s situation, assuming the goal is to maximize the points on everyday spend, and assuming she could fully utilize the airline fee credit, I’d say the Premier Rewards Gold Card from American Express will probably offer her a better return.

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Comments

  1. I was thinking pretty much like Anne but i have a different scenario. Currently I have SPG Amex and Hilton Honors Visa (No Annual Fee Version). I know SPG is a good card but looking at adding couple more cards with good benefits.

    1. I was looking at opening an Chase Sapphire and Amex Everyday
    or
    2. Amex PRG and Chase Freedom.

    I want to keep SPG because of great value of star points and their flexibility. I also travel on work and approved to stay on SPG/Hilton/IHG properties only. So getting SPG Gold is important to me. Today i get it based on spending $30k on SPG card on annual basis.

    What do you recommend? going with option 1 or 2? Or do you suggest another option.

    Thanks
    Harish

  2. @ Harish — Given your situation, I’d go with the Chase Sapphire Preferred and AmEx EveryDay. They’re both fantastic cards, and the EveryDay is a great no annual fee card for everyday spend.

  3. Get both. SPG for 1x nonbonused spend. PRG for bonus spend categories. Both have Amex sync offers that almost always offset the AF, or come very close, even for casual sync users, so there’s almost no reason not to have both.

    I’m a bit miffed they took away PRG’s 15K MR bonus on $30K spend though. It was a good incentive to put modest spend on it, especially in bonused categories – and was clearly Amex’s best card. Was a silly decision on Amex’s part despite them claiming few took advantage of $30K spend. I directed a lot of spend away from PRG just because of that – the extra 15K MRs was worth a heckuva lot more than $100 airline rebate. What Amex should have done is given people the option of either the $100 rebate or the 15K bonus. That way, everyone would have been happy. All you’d have to do is select one option or the other. As such, I don’t buy their explanation the “few” people took advantage of the $30K/15K MR bonus – they cut the bennies because 15K was an automatic award, while getting the $100 rebate requires spend on the specific airline of your choice – of which I’m sure a significant amount of card holders will fail to sign up for, and thus fail to get the rebate (otherwise, why make the rebate specific to one airline?)

    Finally, you didn’t mention that PRG earns MRs which often have bonus offers, like the recent 40% bonus to BA and 25% to Virgin Atlantic. If you can take advantage of the bonuses, PRG can be a significantly better card to put in your wallet than SPG.

    But like you, I carry both and will continue to do so.

  4. @ Lucky,
    Thanks for your advice. I went with Chase Sapphire and Everyday preferred and used your links to get there as well. I will keep SPG for my non bonus spending and use Everyday for all supermarkets/groceries and gas which will cross 30 transactions by mid month anyway. I can split airfares between SPG and Chase by using SPG card on Delta flights that qualify on crossover rewards and use Chase Sapphire on others.

    I think these 3 cards will give me an overall coverage in terms of all types of bonuses available to us.

    Appreciate your blog…learnt a lot over last 24-36hrs.

    Thanks
    Harish

  5. Hi Lucky! Not really related, but I have a question on the Business Gold. I applied for it 7 days ago and my application has been stuck in “In Progress”. I was told the tech dept needs to verify some info and I keep being told to check the next day and it’ll be approved. I just called again and the supervisor over in Retention said they sent an email to the Tech dept to look into it. Any thoughts on how I can get a decision? Should I just assume I’m going to be denied? Thanks.

  6. @ Ang — That’s odd. Wouldn’t make any assumptions, it could just be a holdup somewhere in the system. I’d be patient and wouldn’t be worried. This happens sometimes.

  7. Great post! I have the spg AMEX and am Starwood platinum. I am a moderately high spender on the AMEX (5-8k/month) and pay it off monthly. I’m considering the gold AMEX because of unknowns with the Marriott merger. I also want to maximize travel point flexibility. What would you recommend?

  8. I am trying to make the same decision. I use the chase sapphire reserve for dining and travel ( I also have freedom & freedom unlimited) . I have the prg and spg and only plan to keep one of them. I don’t spend a lot on gas (I work from home often) or groceries so I am leaning toward the spg. I am still not sure … when I get closer to decision time I will probably have to crunch some numbers to see what card comes out on top.

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