Is It Worth Paying the AMEX Starwood Card’s Foreign Transaction Fee?

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Note:  As of August 11, 2015, the AMEX Starwood Preferred Guest cards NO longer add foreign transaction fees!

Million Mile Secrets reader, Gary, commented:

Hi Daraius,
I’m staying at the Sheraton in Port Douglas, Australia.  If I use my Starwood Preferred Guest card there will I still get hit with a 2.7% foreign transaction fee?  Starwood points are hard to earn!

Using the Starwood Preferred Guest card from American Express to pay for stays at Starwood hotels is a great way to earn valuable Starwood points.  But you’ll be charged a ~3% foreign transaction fee when you’re outside the US.

Note:  Starting August 11, 2015, the AMEX Starwood Preferred Guest card will NO longer add foreign transaction fees!

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

It’s Sometimes Worth It to Pay the ~3% Foreign Transaction Fee. But Usually It’s NOT!

I’ll explain when it might be worth it to pay the foreign transaction fee.  And why it is usually NOT.

Should You Pay the Foreign Transaction Fee?

Link:   Starwood Preferred Guest Card from American Express

Link:   Starwood Preferred Guest Business Credit Card from American Express

Starwood points aren’t easy to get!  You can earn them by staying at Starwood hotels.  Or from sign-up bonuses and spending with the Starwood Preferred Guest card from American Express.

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

Paying for Your Stay at the Vedema, a Luxury Collection Resort in Santorini, Greece With Your Starwood Preferred Guest American Express Card Is Usually NOT Worth It!

You’ll earn 2 Starwood points per $1 you spend at Starwood hotels, for a total of 4X Starwood points, when you charge your stay to your American Express Starwood Preferred Guest card.

And if you have Gold or Platinum elite status with Starwood, it goes up to 5X Starwood points per $1 you spend.

But it also has a ~3% foreign transaction fee.  So Gary WILL have to pay that fee when he uses his Starwood AMEX in Australia.  Even when he uses it at Starwood hotels!

Paying an extra ~3% on your hotel stay to get an extra 2 Starwood points per $1 cancels out the value of the points.  And you will earn 2 Starwood points per $1 you spend at Starwood hotels from being enrolled in the Starwood Preferred Guest program.

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

You’ll Earn Extra Points at Starwood Hotels Overseas When You Use Your AMEX Starwood Card, but the Foreign Transaction Fees Are a Pain!

Say your hotel stay and expenses cost $1,000.  You’ll earn an extra 2,000 Starwood points if you pay with your Starwood AMEX.  But you’ll also pay $27 in foreign transaction fees ($1,000 X 2.7% foreign transaction fee).

If you need the extra 2,000 Starwood points for your next award stay, or want to transfer them to 1 of their airline partners to earn bonus miles and an award flight, it could be worth it to pay an extra $27.  But it’s usually NOT.

Instead, you could pay with a different card and earn 2,000 points with another program.  And NOT pay any extra fees.  I’ll explain in a bit!

Where It Might Be Worth Paying Foreign Transaction Fees

There are 3 situations where it could be worth paying the foreign transaction fee.

1.   To Meet a Minimum Spending Requirement

If you are close to meeting your minimum spending requirement, the bonus you’ll earn will far outweigh the cost of paying the foreign transaction fee.

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

If You’re Close to Meeting Your Minimum Spending Requirement, You Might Consider Paying for an Overseas Starwood Stay With the Starwood Preferred Guest American Express Card

However, with so many ways to meet your minimum spend, this should be considered a last resort.

2.    You’re Close to an Award Stay

If you’re a few Starwood points shy of an award booking at a Starwood hotel, you might decide to pay the foreign transaction fee.  Because the extra Starwood points will get you Big Travel at a Starwood hotel.

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

If You Need a Few More Points for an Award Stay at a Starwood Hotel, Like the Sheraton Kona Resort & Spa at Keauhou Bay, You May Want to Pay the Foreign Transaction Fee!

And you’ll save more money on the award stay than the cost of the foreign transaction fee.

3.   You’re Close to a Free Flight

One of the best uses of Starwood points is to transfer them to 1 of their airline partners.  Because you get an extra 5,000 airline miles for every 20,000 Starwood points you transfer.

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

Free Flights Are Great! And You Earn 5,000 Extra Miles When You Transfer 20,000 Starwood Points to Partners Like British Airways – Enough for a Free 1-Way Short Haul Flight on American Airlines and Alaska Airlines!

If you’re close to having 20,000 Starwood points, the 5,000 mile bonus can be worth paying a foreign transaction fee. 

There Are Better Options!

Link:   Chase Sapphire Preferred 

Link:   Citi Prestige

Link:   Cards Without Foreign Transaction Fees

Outside of the 3 situations above, I recommend putting your Starwood hotel stays on a credit card that has NO foreign transaction fees.

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

You Can Earn Points Without Paying Foreign Transaction Fees! And Use Them for Big Travel!

The Chase Sapphire Preferred earns 2X Chase Ultimate Rewards points per $1 spent on any hotel – no matter the location.  Chase Ultimate Rewards points are valuable because you can transfer them to great partners such as United Airlines and Hyatt.

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

The Citi Prestige Card Will Earn You 3X Citi ThankYou Points for Overseas Hotel Stays!

Or with the Citi Prestige card, you can earn 3X Citi ThankYou points per $1 you spend at hotels.  The Citi Prestige allows you to transfer points to ThankYou travel partners.

And when you redeem Citi ThankYou points earned from the Citi Prestige card for flights on American Airlines through the Citi Travel Center, you’ll get a value of 1.6 cents per point.

And because both have no foreign transaction fees, they are better to use internationally than the Starwood Preferred Guest Card from American Express.

The Fastest Way to Earn Starwood Points

The sign-up bonus of 25,000 Starwood points when you open the Starwood Preferred Guest card from American Express and complete the minimum spending requirement is the fastest way to begin accumulating Starwood points.

And now that minimum has been lowered to make it easier to earn the bonus!

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

The Starwood Preferred Guest American Express Signup Bonus Is Enough for a Night at The Royal Hawaiian, a Luxury Collection Resort, Waikiki!

Folks love Starwood points because of the 5,000 mile bonus when you transfer 20,000 Starwood points to these airlines: 

 Starwood Preferred Guest Airline Transfer Partners 
AegeanAeroMexicoAir Canada
Air BerlinAir ChinaAir New Zealand
Alaska AirlinesAlitaliaANA
American AirlinesAsia Miles (Cathay Pacific)Asiana Airlines
AviancaBritish AirwaysChina Eastern
China SouthernDeltaEmirates
Etihad Flying BlueGol Smiles
Hainan AirlinesHawaiian AirlinesJapan Airlines
Jet AirwaysKorean AirlinesLAN
Miles & More (Lufthansa)Qatar AirwaysSaudi Arabian Airlines
Singapore AirlinesThai AirwaysUnited Airlines
Virgin AtlanticVirgin Australia

You also get the 5th night free on any award stay when you book at a Category 3 or higher hotel.  Read more about the best ways to redeem your Starwood points.

In the summer, American Express usually runs a promotion where you earn a sign-up bonus of 30,000 Starwood points.  But no guarantees whether it will return in the coming months!

If you’ve ever received the bonus on the personal version of the Starwood Preferred Guest American Express, you are NOT eligible to receive it again.  American Express recently changed their policy to award the bonus on ALL of their personal cards once per lifetime.

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

Sorry! You Only Get 1 Sign-Up Bonus on the Starwood Preferred Guest ONCE per Person, per Lifetime!

But with all American Express business cards, including the Starwood Preferred Guest business card, you can earn the sign-up bonus again if you haven’t held the card for at least 12 months.

So keep this in mind when you apply for an American Express card.  And if you’re feeling lucky, you might wait to see if the 30,000 Starwood point bonus will return this summer!

Other Ways to Earn Starwood Points

1.   Ride With Uber

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

Earn Extra Starpoints When You Ride With Uber

You’ll earn 1 Starwood point per $1 you spend riding with Uber, up to $10,000 per calendar year.  And you’ll earn more if you have elite status with Starwood – up to 4X Starwood points per $1 when you use Uber while staying at Starwood hotels.  

2.   Fly With Delta

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

If You Have Gold or Platinum Status With Starwood, You Can Earn Starwood Points When You Fly Delta

With Delta Crossover Rewards, you get 1 Starwood point per $1 spent on Delta flights if you have Gold or Platinum status with Starwood.  

And you’ll earn 1 Delta mile for ever$1 you spend on a Starwood stay if you have any elite status with Delta.  Remember you get Starwood Gold status as a benefit of the American Express Platinum Card.

3.   Fly With Emirates

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

Gold and Platinum SPG Members Will Earn Extra Starwood Points When Flying Emirates

Similar to Delta, Emirates has a partnership with Starwood Preferred Guest called Your World Rewards.  Starwood Gold and Platinum members earnStarwood point per $1 spent on Emirates flights, in addition to the Emirates miles you’ll earn for flying.

And you’ll earn 1 Emirates mile for ever$1 you spend on a Starwood stay if you have elite status with Emirates.

4.   Stay at Caesars Hotels

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

You Don’t Need Luck to Earn Extra Starwood Points When You Stay at Caesars Hotels in Las Vegas!

When you stay at Caesars Entertainment hotels and link your SPG account to Caesars Total Rewards, you’ll earn 2 Starwood points per $1 spent.  Even on food and drinks charged to your room!

 5.   Rent a Car With Avis or Sixt

Is It Worth Paying The AMEX Starwood Cards Foreign Transaction Fee

Earn Bonus Starwood Points When You Rent a Car

When you rent a car with Avis or Sixt, you can select Starwood as your bonus program.

When you rent with Avis, you can receive 50 Starwood points per day.  And when you rent with Sixt, you can receive 250 Starwood points on an eligible rental.  Every little bit helps!

Bottom Line

It’s usually NOT worth it to pay the ~3% foreign transaction fee when you use the Starwood Preferred Guest card from American Express at Starwood hotels overseas.

But there are a few situations where you might consider it.  Like if you are close to an award stay.  Or if you want to transfer 20,000 Starwood points to receive 5,000 extra miles with airline partners.

Cards like the Chase Sapphire Preferred or the Citi Prestige card are better for international Starwood stays because they earn bonus points for hotels.  And they do NOT have foreign transaction fees.

There are other ways to earn Starwood points in addition to staying at Starwood hotels.  So don’t feel like you have to pay the foreign transaction fee!

Although it won’t be around much longer.  Because on August 11, 2015, the AMEX Starwood Preferred Guest card will drop the fee!

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4 responses to “Is It Worth Paying the AMEX Starwood Card’s Foreign Transaction Fee?

  1. The question was specific to Australia and travelers should be aware that in Oz if you use a CC to pay a hotel bill you will also be hit with a 1-1.5 % charge for using the CC.Got surprised at the MEL Grand Hyatt when we paid with a Chase Hyatt card.

  2. Dan's the Man

    The card no longer charges foreign transaction junk fees. I called Amex today to confirm.

  3. Is the new Starwood card coming out in August a new card? Meaning I can apply for it like a new card or if I already have it I cannot get the new card.

  4. What’s the best way to use 200,000 Amex points right now? The points are on the Blue from Amex, so I may have to open a different Amex (which I am okay with doing) in order to transfer them, if that is the best thing to do.
    Any suggestions? Thank you!!