Guide: Should you Buy Points or Pay Cash for Hotel Stays? Use this Simple Formula to Decide

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Guide: How to Decide Whether to Buy Points or Pay Cash for Hotel Stays

Guide: How to Decide Whether to Buy Points or Pay Cash for Hotel Stays

If you are looking to book a weekend night or a holiday it can be nearly impossible to get a decent rate. However, most hotel programs allow you to book with points for a fixed flat rate or specified range regardless of what the actual cash rate is per night. In certain situations where the cash rate is very high, you can protect yourself from the rate hikes by purchasing points for an award night redemption. In the miles and points world we call this arbitrage.

This guide will explain how to decide whether it makes sense to pay cash or use points for a stay. It’s very simple to figure out once you know what you’re looking for. (Of course, if you already have a ton of points to use, you may not want to lay out any cash regardless of the value of your redemption. But that’s another issue altogether.)

Related: Does it Make Sense to Buy Points for Award Tickets? The Answer is Yes, More Often than You Think!

Doing The Math

Here are step-by-step instructions on doing the math to see which option is best.

  1. Look up how many hotel points it costs to book an award night at the specific hotel.
  2. Find out the price to buy points.
  3. Multiply the price of points with the number of points needed for award nights.
  4. Now look at the cash rate, if the price in points is lower, then you should buy points.

Guide: How to Decide Whether to Buy Points or Pay Cash for Hotel Stays

Example 1

Now let’s look at a few examples where points are not on sale. How about an incredibly expensive property. For fun, let’s look at the Park Hyatt Maldives.  The dates I searched cost $990 per night, but the cost in points is 25k Per night. First, you have to see which category the hotel falls under, which is easy since our Resources Page has a link to the award chart with all of the prices listed. Since this is a category 6 property, you would need 25k points for a free night award. In order to buy 25k Points from Hyatt, it would cost you $600. 25,000 Points Needed for Award Night

$600       Cost to buy 25K Points

$990     Cash Rate

+ $390   (Buying Points would save you $600 in this example.)

But, what if Hyatt was having a sale, say 40% more points as they had earlier this year? The cost of 25k points in that scenario is $428 (about 1.71 cents a piece).

Example 2

Guide: How to Decide Whether to Buy Points or Pay Cash for Hotel Stays

SPG allows you to buy up to 30,000 Points for a total of $1,050. Currently, those same 30K points can be transferred to 90k Marriott Rewards Points. Let’s look at an example. The Gwen Hotel will cost $3,000 for 6 nights. Since it’s a category 5 SPG Property it can also be booked with 12,000 points per night, so for the same 5 nights it would be 48,000 points. Or Points and Cash would be 6,000 points + 110, so 24,000 + $550. We need to figure out which option requires the least out of pocket. 


$48,000 Points = $1680

24,000 Points ($840) + $550 = $1390

So would you rather pay $3000 out of pocket or $1400sh? In this example you would be saving around 1/2 by using some combo of points.

Should You Buy Points? Other Factors to Consider

No Loyalty Point Earnings

You generally do not earn loyalty points for nights paid for with points since the amount of points you earn is based on the amount of spend. However, this is definitely offset by certain perks including waived resort fees, taxes etc on award nights. Also, several chains offer the 5th night free when paying with points.


Hotel Loyalty programs occasionally run some very lucrative promotions but they are often only applicable on non-award nights. So if you’re looking at booking during a time when there’s an amazing promo going on, you may want to pay a little more for the cash rate.

Discounts on Points

Chains periodically run promotions for discounted purchases on points, these are generally the best time to buy points if you know you can make use of them.

Elite Stay Credits For Less

If you’re trying to meet a certain number of nights toward re-qualifying for your elite status, you can use arbitrage to pay for those nights at a cheaper rate since award nights qualify in most hotel programs.


The decision to pay with points or cash is not always an easy one when you consider the various factors that will affect your decision, however, using this formula you’ll at least have a mathematical baseline. Start with the cost to you and go from there.

Just a few Reasons to Buy Points

  • Cheaper to buy the miles/points for a ticket or booking than to pay cash.
  • Fees or taxes may be waived for award nights
  • Hotel chains like Hilton and Marriott offer the 5th night free when booking an award stay.
  • Take advantage of discounted point+cash rates.

Bethany Walsh
Bethany Walsh
Founder of, Bethany is a points, miles and loyalty program strategist who enjoys luxury travel and lives for a deal. When Bethany is not following her Miles to Memories family around the world to various meet-ups you can find her on a beach, in a casino or on a mileage run.

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  1. @Bethany & Matt Well maybe not everybody as “brilliant” as you too…nothing like shaming someone not as smart as you. I wonder how you would feel if someone does that to your kid in school

  2. Also both SPG and Hyatt have a cap on the number of points you can purchase. So in the Hyatt example, if you wanted to stay 3 nights, you would be out of luck as 3 X 25k = 75,000 Maximum purchase is 50,000 per year.

  3. The question is, will people willing to pay $500, $600 in cash to get the necessary point to stay a night which cash price is over $900.
    Or would you pay that money?

    • Yes, I do it all the time. I burn through points very quickly since I generally stay in higher categories. And of course I’d rather pay $600 than 9 🙂

  4. Maybe you should also consider the cost of points when acquiring them over a time, eg from cc bonuses, or even just buying visa gc’s — which can bring the cost down to less than 1 ct/pt.

  5. That’s the most “Captain Obvious” post i have ever read. I guess some people struggle with simple math concepts. Don’t know how one would function in life without understanding a formula this simple, but heh, I guess that’s the world we live in.


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