July 19, 2024
Ask a Travel Nerd: To Save Big, Book Hotels With Points

Would you rather have free flights or free hotel rooms for the rest of your life? As someone who spends a lot of time crisscrossing the U.S. with family and friends, my first instinct is to say flights. I rarely spend more than a few nights per year in a hotel, because I’m usually crashing with friends, staying at a big vacation rental or traveling with my family of six that won’t fit into one hotel room.

But after a bit more reflection, maybe there’s a good reason I don’t currently spend a lot of time in hotels — it’s expensive! Not only is lodging an expense that recurs every single night, it’s one that can come with extra fees you didn’t budget for.

And budgeting is what this hypothetical question comes down to. It’s asking me to prioritize what travel expense I want to save on, and how I should redeem my points.

There are a few reasons why booking hotels is the best way to use points for travel. See how this thinking could change your travel rewards strategy.

Why hotel redemptions are a smart money move

Hotels are the biggest travel expense

From a sheer numbers perspective, travelers spend more money on hotels than airfare. According to the 2020 Consumer Expenditure Survey conducted by the U.S. Bureau of Labor Statistics, Americans spent an average of $318 annually on out-of-town lodging. That’s almost double the $160 average spent on airline fares.

One reason hotels are so expensive is that it’s a recurring cost. The longer your vacation, the more you’ll spend on the room, parking, resort fees and more. Even for a one-night stay, a $150 room rate and a $70 overnight parking fee add up to more than your $120 round-trip flight and the $60 it’ll cost to check your bag.

Redeeming points for hotel stays will save you the most money and can be a good way to avoid fees and other budget constraints. For instance:

  • Two hotel loyalty programs, Hilton Honors and World of Hyatt, waive the resort fees when you book a hotel on points.
  • Marriott Bonvoy offers a fifth night free to anybody who pays for the first four nights in points.
  • Certain travel credit cards offer a fourth night free on award stays.

Hotels could offer additional savings in other parts of your travel budget

Using travel rewards on hotels can help you save money beyond lodging costs.

Our travel writer, Sally French, documented the cost of her Walt Disney World trip and how she saved $700 on her hotel stay by booking with points. Meanwhile, she used a Companion Pass and an airline fee credit from her credit card to help offset the cost of airfare for her and her boyfriend; her savings totaled a respectable $438.

Still, her hotel savings of $700 was greater, and her lodging included built-in perks that saved her money in other areas of her budget. She got free transportation to the parks through the hotel shuttle and saved money on food thanks to the hotel’s complimentary breakfast.

Hotels usually offer more freebies than airlines do. You’ll at least get a travel-size bottle of shampoo and conditioner, whereas a seat on an airplane might not even get you a bag of pretzels.

There’s more variability in hotels

Flights are essentially all the same. Whether you’re flying in a luxurious lie-flat seat or a standard seat next to the bathroom in the back of the plane, the only real difference is the amount of legroom and recline. Otherwise, the product itself is pretty similar.

Hotels, on the other hand, can really range. They could be old, dingy and far from the places you really want to see. Or they could be more opulent, convenient and a destination themselves.

Using your points for hotel stays gives you more choice — and more control — over the quality of your travel experience. You can use your hotel points on any part of the price spectrum, whether you want to stay in a better location or get the amenities you love.

Hotel award charts make planning high-value redemptions easier

These days, few airlines or hotels use award charts to price their award travel; nonetheless, hotels win out since at least a couple of big chains continue to publish charts. Notably, Hyatt, Wyndham and Radisson still publish award charts, as does Marriott. (Note that Marriott is switching to dynamic pricing in March 2022; however, following the switch and through the end of the year, prices will only fluctuate between peak and off-peak rates in its award chart.)

Hotel award charts and their categories make it much easier for you to redeem your points effectively. You can more confidently predict how many points you’ll need for a stay, making it much easier to strategize earning and apply for co-branded hotel credit cards to help cover the costs. Once you find out what category your desired hotel is in, you’ll know about how many points you’ll need for an award night.

Meanwhile, it’s often anybody’s guess how many miles you’ll need for a flight. Even if the airline has an award chart, you might have to familiarize yourself with regions and seasonality to be able to read it correctly.

Another advantage of award charts, in general, is that you’re more likely to find sweet spots. If a hotel always costs 15,000 points per night — regardless of the cost in dollars — you might find a really good deal on a high-priced room.

The bottom line

You may hear stories of people saving hundreds or thousands of dollars with their travel rewards. If you want to save the most cash, you should redeem points for hotel nights instead of flights, at least some of the time.

Spending your points on hotel nights comes with other potential benefits, like the ability to stay longer with free-night rewards, or the chance to save on food and transportation with hotel shuttles and complimentary breakfast. And, of course, there’s that ultimate luxury: tucking into one of those comfy hotel beds.

More From NerdWallet

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.