I apologize to my email subscribers for receiving emails about old posts today. I changed the settings on a few posts and WordPress decided to send emails on all of them again, which I didn’t expect. I’m very sorry about filling your inbox!
I recently wrote a post about manufactured spending your way to the best hotels in the world, and I wanted to follow that up by taking a deeper dive into some strategies to manufacture Hilton points specifically so this post explores those options. Despite the massive devaluation that occurred recently, Hilton remains one of the best values in manufactured spending.
Hilton Credit Cards
There are several different credit cards across multiple banks, but I’ll only discuss the two relevant ones here:
- Hilton HHonors Reserve Card (Citi): 10X on Hilton spend, 5X on airlines & car rentals, 3X everywhere else. Also get a free weekend night after $10K in spend. $95 Annual Fee.
- Hilton HHonors Surpass (Amex): 12X on Hilton spend, 6X on restaurants, supermarkets, and gas stations; 3X everywhere else. $75 annual fee.
Both cards come with free Hilton Gold status and allow you to attain Diamond status with $40K in annual spend.
The key difference is in the bonus categories – the Reserve card doesn’t have any bonus categories that are good for manufacturing points, but the Surpass card earns 6x on grocery store purchases, which could be useful.
Which Card is Better for Manufactured Spending?
Lets look at the cost breakdown of manufacturing points with each of them to determine this. We’ll also take a look at earning top-tier Diamond status through spend as well.
Grocery
If you’re buying Visa/MasterCard gift cards from a grocery store, the best value you normally get is a $500 gift card for a $5.95 fee. If you’re using the Surpass card you’re earning 6x, and that means you’ll earn 6 x $506 = 3,036 points for a cost of $5.95/3,036 = .00196 each.
Everywhere Else
If you’re buying gift cards from your favorite mall, the most well known value you get is a $500 gift card for a $2.95 fee. Using either the Surpass or Reserve card you’ll earn 3x, and that means you’ll earn 3 x $503 = 1,509 points for a cost of $2.95/1,509 = .00195.
So Which is Better???
As you can see by the calculations, it’s pretty much identical on which card is best to use if you manufacture the points the way I described. The decision you make should come down to how much you actually plan to manufacture.
No one wants to deal with more gift cards than they have to, so if everything else was equal, it would be best to use the Surpass card because it would require fewer gift cards and trips to the store(s). But the one benefit of the Reserve card I highlighted above was that you get an annual free night after $10K in spend, which may tilt that scale a bit.
That free night certificate can be used at any Hilton hotel, including those that are priced 80K to the max of 95K a night like the Conrad Koh Samui. To manufacture 95K points with the Surpass card, which would be the equivalent of the free night you get with the Reserve card, you’d need to buy an extra ~$16K in gift cards.
So here’s my recommendation:
- If you’re going to manufacture less than $10K, use the Surpass card.
- If you’re going to manufacture $10K-$31.5K, use the Reserve card.
- If you’re going to manufacture $31.5K+, use the Surpass card.
At around $31.5K, you should be roughly indifferent between the free night and the extra points because the value would be roughly the same. On the reserve card, 3 x $31.5K = 94,500 points plus a free night (valued at up to 95K), so in total worth a value of up to 189,500 . On the Surpass card, 6 x $31.K = 189K points.
The difference here is that having the points will be more flexible for everyone, so for most people I will recommend the Surpass card.
Manufacturing Diamond Status
Remember, to manufacture Diamond status you’ll need o get to $40K on either card. If you’re going of my analysis above, getting to $40K would be a smarter thing to do with the Surpass card. You’ll earn roughly 240K points (6 x $40K). That’s two nights at a top tier hotel (190K) plus another 50K leftover. On the Reserve you’d earn 120K plus a free night, which is enough for 2 nights at a top tier (with one of the nights restricted to the weekend only) and 25K points leftover.
Again, the Surpass card is my recommendation for almost all cases here.
When to Manufacture Diamond Status
As with many points-related things, there’s an optimal strategy here to earn Diamond status. When you spend $40K on either card, you earn Diamond status for the rest of that calendar year and the following calendar year. That means that the best strategy then is to achieve the $40K spend as early as possible in the year.
For example, if you completed $40K spend in January 2014, you’d have Diamond status for all of 2014 and all of 2015. The optimal way to complete the spend requirement for Diamond status is to spend $40K as early as possible every 2 years. In this example, that would mean another $40K in January 2016 that would give you status through the end of 2017.
Plan ahead 🙂
You can read more detail about manufacturing Hilton Diamond status in this post from Frequent Miler.
Summary
For most manufactured spenders, the Hilton Surpass Amex will be the better option. It has a lower annual fee and also gives you Gold status (and Priority Pass membership to boot), all for a lower annual fee versus the Reserve card.
If, however, you’re only looking to meet the minimum spend requirement and get a good bonus, the Reserve card is the one you want. It will get you two free nights at any hotel, whereas the Surpass only gives you a 75K bonus (offer fluctuates).
Do you manufacture Hilton points?
Excellent analysis, thanks. Received all your accidental spam emails today too. Those old posts are very good still.
Is this a repost of FEB 2013? seriously! You maybe able to buy the gift cards but what are you gonna do with those? storm walmart customer service desk machine and reload it yourself?
Let me write some of the things you left out. First you can’t load these yourself at the WM koisk, you have to stand inline which is fine but most WM cashiers now require you to show real bank debit not something that says GC. So in those situations, you wasted your gas and time for nothing. 2 out of 10 WM you drove in 7 days might allow you to load but after you swipe the first one, the agent might say show me the cards since they don’t like somehow loading again and again. The days of GC ms is already gone. it is over! please stop pretending to be in heaven!
First of all, Walmart is NOT the be-all-end-all for everyone. If it is for you, you need to go read Frequent Miler to get more information or research a bit harder. Second, the $3 gift cards absolutely do work at Walmart.
Just because your MS world has come crumbling down doesn’t mean everyone elses has as well!
Thanks for the post. I had completely overlooked that 6x on groceries. At my nearest Walmart all of the mentioned cards load as long as they are Visa. They never ask to see the card or ask any questions. Although getting to 40k would take 4 months if you have 2 loadable cards, less if you do the MO route which increases the cost a bit. It will also take more time if you need to meet min spend on other cards through MS.
That’s why I have cards from lots of friends and family 😉
Have unloaded about $11k at my local WM this month. No issues aside from being asked to see the card once. Didn’t have my actual debit card ready so the load was declined. Immediately went to stand in line at another register and had no issues.
TS – Thanks for your post and great analysis!
Thanks! I also usually have my real debit card in case I need to “ninja” it to show the cashier.
shall we say 10 cards, hahha
Sorry, Jim, where have you been lately! You are completely wrong on WM. I am still able to load ViSA GC in WM for $2500.00/day/card without any issues, so far. Agree that you have to stand in-line in some WM stores. Fortunately, my local WM has a kiosk. Once I had to stay in-line due to maintenance but if I go at certain time at night, there is almost no waiting line….
I like Hilton, but I think they’d be towards the bottom of the points that I’d want to manufacture. Even MSing on the Barclay Arrival seems better than on some of these Hilton cards
Based on what though? If you want to stay at a top tier hotel, there’s no way you can effectively do that with a cash-back card (unless it’s 5%). With the Arrival card you’ll earn a profit of roughly $16 per $1K in gift cards. That will take $31K in gift cards to get to $500, which may not even cover a single night at the Conrad Koh Samui or other high end hotels. That same $31K in gift cards gets you at least 93K points, and possibly twice that if using 6x (though for a higher cost), which guarantees a night at a top tier hotel.
Hilton points may not be worth much, but they still give 3x or 6x, which is a lot more than other programs.
here is a trick after many many hours and days in lines, if and only if cashiers ask to see the debit card, show him or her the real thing from any of your bank, then discretely like any magician with fast hands, switch and swipe with the GC, but always dont go crazy with repetition of one after another. two or three max and move on to the next cashier.
I ms the no annual fee version of the surpass which gets 5x at grocery stores. This is a card I dont have to worry about canceling but can only get gold with 20K in spend.
The difference between Gold and Diamond is minimal anyway, so to earn just the points this card is a great option.
Thanks for the writeup.
My basic questions are:
1. Why someone needs to earn a Hilton Diamond as it is not much different than Hilton Gold status which can be had easily? Can you please explain that?
2. Hilton points are valued the lowest in ALL of Hotel industry. Hilton pts are valued around 0.4cents. So, 6x times 0.4 is only 2.4 pts (I have seen Hilton properties having 250,000 pts for one night in the high season! Ridiculous to say the least!). So, 240,000 pts doesn’t go far…
3. What is the opportunity cost vs. other programs?
1. I agree that having Diamond is only marginally better than Gold. It does help get better upgrades at some properties, but otherwise it’s the same. I didn’t say it’s worth it, I just wanted to explain how it’s possible.
2. I’d argue that 2.4 cents/point is actually a good value! And although you’ve seen 250,000 points per room, that just means a standard room was not available. Hilton’s highest point requirement is 95K for standard rooms. They offer premium rooms for higher rates if standard rooms are sold out, so when you compare to 95K, Hilton actually beats all other hotel programs. Check out this post for more info: http://travelsummary.com/manufactured-spending-way-best-hotels-world/
3. Again, the link I just posted above will help with the opportunity cost. You can manufacture SPG for a little more, but there’s more restrictions on top tier properties. Hyatt is also more expensive but with less restrictions than SPG, but has a smaller footprint. IHG/Marriott and others are not worth it. Club Carlson, however, is definitely worth it. Check out this post for more info: http://travelsummary.com/manufacturing-club-carlson-rewards-points/
I am currently spending on the Amex Surpass card to meet $40,000 spend this calendar year. My card closing date is the 10th of the month. The card member agreement says that it will take 10 to 12 weeks after spend is met for status to become effective. If I, say, meet the spend on 12/11 does that mean that I only have Diamond status from March of 2015 to 12/31/15?
Yes, although the membership year expires in February so you’d actually have it until 2/2016.