so i said good-bye to my SPG amex yesterday ...

i love the starwood preferred guest (spg) program. the starwood group of hotels include all the sheratons, westins, four points, alofts, Ws etc of the world. like airline mileage programs, the more you stay, the more points you earn, the more free nights you get. it's very similar to the marriott rewards, the hilton hhonors, the priority clubs etc. i know it sounds so basic, but i'm so surprised by how few people know about these hotel programs.

anyway, i like it because a free night at one of their mid-range hotels is roughly 7,000 points, sometimes you get them cheaper, sometimes you get them pricier. my SEA hotels would normally cost 115$  and at 7,000 points, it's like getting a 1.5c per point value. when i go to SFO, i lucked out and got a 250$ hotel room for 3,000 points, or 8c per point value. the other real value is that one can transfer these points to one of 29 airline programs, most at a 1 spg point to 1.25 airline mile ratio. but that's only a like. i love it because of the potential perks of status. that's for another post.

for three years, i was carrying around the spg amex card. it was a nice card because you earned 1 point per dollar spent (so if you carry through the math, it's like getting 1.25 aeroplan or american aadvantage miles per dollar spent on the card). in contrast to the CIBC aerogold visa or the RBC avion visa which only gets you, roughly, 1 airline point per dollar spent.

the first year i had the card, it was a promo: first year's annual fee waived. the second year, i naively paid the 120$ annual fee in return for 5,000 bonus points. the third year, i called in threatening to cancel the card, and they quickly gave me 125$ in banana republic gift cards. it was renewal time, and they were refusing to do it again.

time to quickly do the math. 12,000 cents (120$ annual fee) just for the ability to earn the points. i spent 24,000$ on the card last year, so i suspect it will be the same next year). 12,000/24,000 = 0.5c per point earned. so the value of each point earned was reduced by 0.5c. and given how difficult booking reward seats can be sometimes (i value an airline mile at ~2c per mile nowadays), how it's rare to get such a great value on hotel room nights, and how my current no-fee MBNA mastercard gives me a 2% return in cash back anyway, i decided that it was better to stick with my cash back card.

but now i'm left wondering whether i want to replace the amex with something else. scotia bank's amex gold card looks really appealing. if i can spend 5,000$ a year on groceries, gas, dining, and entertainment, i'll break even with the annual fee. and then everything else will be a 4% return. it's something to think about.