Great Deal for Purchasing SPG Points

I received an email from Points.com yesterday with a great offer for purchasing SPG points. Through May 31, 2015, you can purchase SPG points at either a 10% 15%, 20%, or 25% discount. 

• Buy 5,000–9,500 Starpoints: save 10% ($31.50 for each increment of 1,000 points)
• Buy 10,000–14,500 Starpoints: save 15% ($29.75 for each increment of 1,000 points)
• Buy 15,000–19,500 Starpoints: save 20% ($28.00 for each increment of 1,000 points)
• Buy 20,000 Starpoints: save 25% ($26.25 for each increment of 1,000 points)

So this means that if you go all in it will cost you $525 to purchase 20,000 points. While I would not suggest to just purchase points out of the blue, if you do the math for a particular upcoming hotel stay, you might actually find that purchasing and redeeming points might be cheaper then just paying for the hotel outright.

Some things to know with this promotion:

• The maximum number of points you can purchase in a calendar year is 20,000 points (but you can transfer points freely between members of the same household)
• You can purchase points in increments of 500
• Points take up to 24 hours to deposit into your account
• Your Starwood account must be activated for at least 14 days – if you are new to the program and looking to make a purchase make sure to create an account now
• Purchase points here

Now remember, over a year ago Starwood went through a devaluation of their Cash & Points redemption and increased the point requirement of many of their hotels. While this promotion can be extremely great for certain properties, it is definitely not as lucrative as it used to be.

An example of where this can play out well:

• Le Meridien Chiang Mai or Le Meridien Chiang Rai – Both are a category 2 hotel and typically always available for cash + point redemption. This will require you to redeem 2,000 points + $35. The cost of the points plus the “cash” portion of the redemption will only cost you $87.50. However, if you have plans on staying on a weekend, you can redeem just 3,000 points for a free night, which will cost you $78.75. Typically, a room at this hotel typically costs at least $120/night.

Pros/Cons of Redeeming Points:

• You will still get stay/night credits even when redeeming (pro)
• You will not get the points (con)
• If there is a bonus at the time, you will be ineligible when redeeming points (con)
• If you are using all points, you will not have to pay any taxes (pro)
• If using cash + point, you sometimes need to pay tax on the cash portion, but since this is on such a smaller amount you will not have to pay the full tax on the regular rate and at some resort and city locations this can be extremely high (pro)
• At some hotels, you do not have the pay the resort fee if using points to redeem for your stay (pro)

So unless there is some unbelievable promotion going on, or the cost of purchasing points is close to the cost of actually paying for the stay, definitely use points when it is cheaper.