|by Jason Steele|
Hardly a post I write about reward cards fails to mention the Starwood Amex Card. For my purposes, it is simply the best reward card out there. The Starpoints you receive are the most valuable and flexible points in the business, transferable to dozens of airlines or redeemable at any Starwood property with no blackouts or capacity controls.
Had Starwood asked me what changes I would have liked to have seen, I would have said “none”. Unfortunately, that is not how the world works. Starwood will be increasing it’s annual fee from $45 a year to $65, starting with all renewals after October. They will also be eliminating the the 50% off coupons. Those coupons were really of questionable value since the 50% off only applied to the rack rates, which nobody pays anyways. Nevertheless, I once saw value in using it when 50% off the rack rate was somewhat lower than their available discount at a a pricey resort. Other changes include an automatic 5 stay credit towards premium status with Starwood, as well as your third night free at Sheratons with two paid nights.
What Do I Think
This card works for me on so many levels, so I will still pay the annual fee, albeit reluctantly. As I normally do, I am sure I will call and ask for the fee to be waived or for them to throw me some Starpoints for being such a good customer. Sometimes they do and sometimes they don’t. I am not really excited about the 5 stay credit towards status. I simply don’t purchase hotel rooms that much, yet I still receive status by hitting the $30,000 annual spending mark (partial thanks to the US Mint, if you know what I mean).
As for the Sheraton freebie, I might could see using that, it all depends on if there are any restrictions. If there do not allow it with discounts and promotions, it will be even less useful than the 50% off coupons were.
Who Should Cancel Starwood
As the annual fee rises, the card will appeal to a smaller and smaller group. The first people who should be particularly concerned are those who are not big spenders. If you value Starpoints at 4 cents each, then you will need to spend $1625 just to break even on your annual fee. If you value them at 3 cents each, you are looking at $2,167 to break even. What you really have to do is compare it to is the other available reward cards without an annual fee. So really you are looking at a baseline of a 1% reward card, although some can give you cash back rewards closer to 2%. Either way, the Starwood Amex still comes out ahead if you are spending more than $5,000 a year, regardless of how you value your rewards. Nevertheless, people who don’t meet those numbers, and people who don’t normally visit a lot of Starwood properties, should probably be considering other cards.