Purchase SPG Points with up to a 25% Discount

A new promotion just came out from SPG where you can purchase SPG points at either a 10% 15%, 20%, or 25% discount. I am somewhat surprised to see this new promotion come out the day after the shocking announcement that Marriott will be buying them, but maybe this is some way to make their customers happy over the next few months. This promotion goes through December 31, 2015.

• 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. I definitely WOULD NOT suggest buying points speculatively, especially since we have no idea what will become of SPG points later into 2016. However, if you have an upcoming stay at a Starwood hotel, I suggest doing the math to see if purchasing points is cheaper then 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
• Purchase points here

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.