IHG Rewards System

Here is my take on the IHG Reward system. I stay at Holiday Inn a lot, so I am somewhat familiar with how the points can be earned and how to use them. I figure it might be worthwhile to read my take particularly if you have plans to stay Holiday Inn a lot.

Things you need

There are two things you’ll want to need: a Chase IHG Rewards Club Select credit card and an AAA membership card.

Chase IHG Rewards Club Select card

You don’t need this credit card to earn points but can earn more points using the card at Holiday Inns than without it.

As of this writing, the credit has the following features:

  • Earn 60,000 points when you spend $1,000 in the first three months
  • Earn 5 points per dollar at IHG hotels.
  • Earn 2 points per dollar at gas stations, grocery stores, and restaurants
  • Earn 1 point per dollar for all other purchases.
  • $0 introductory annual fee, then $49 per year.
  • 10% rebate on IHG reward club redemptions
  • Annual free night worldwide
  • No foreign transaction fees
  • Platinum Elite Status

The one thing that should compel you to get the card is the one free night per year and the $49 annual fee. Basically, you would be getting a room for $49. Though I haven’t done this, I heard you could book the most expensive room you can find by using the annual free night.

There is one little catch and it is that you have use the card throughout the year or Chase can terminate your credit card due to inactivity. (I have had a bank terminate a non-IHG credit card due to inactivity.) I don’t know how often you need to use the card. For me, I only use the card for hotel bookings and I still have the card.

 AAA membership

If you’re the type of person who wants to book a room with no cancellation fees (the ability to cancel without a charge at least two days prior to check-in), get an AAA membership card. The reason is that AAA rates comes with no cancellation fees and are cheaper than the Best Flexible rate, which carries no cancellation fees as well.

When you book a room online, however, you may not see AAA rates even listed. They are there. If you don’t see the AAA rates, go the Rate Preference drop-down box, select AAA/CAA rate, and select the Apply button. Now you should see the AAA rate if the location offers it.

When you go to www.ihg.com/holidayinn through E-bates, you’re not going to have the option to see AAA/CAA rate in the Rate Preference drop-down box.

How to earn points

Important note: The following is useful if you have both AAA membership and an IHG credit card.

Do not pay $5 for 1000 points

For the uninitiated, some Holiday Inn locations offer a special deal for the Best Flexible Rate. For $5 per night more, you can earn 1000 extra points per night.

If you qualify for AAA rates, go for the AAA rates and bypass the Best Flexible Rates even if they include the 1000 points for $5. In most cases, you’re better off going with the AAA rate.

Plus, the price differential between the AAA rate and Flexible+1000 point rate is more than $5. For instance, at Holiday Inn Old Town San Diego, you can get a one queen bedroom for an AAA rate of $144.99 per night. The Best Flexible Rate is $149.99 per night. Tack on the $5 for 1000 points and the room rate becomes $154.99 per night. Practically, you would be spending $10 for 1000 points per night.

Later on, I’ll show you why AAA rate is the better deal.

Per Night vs Per Stay

Know the difference between these two terms. Per Night means just that – per one night. Per Stay refers to the entire stay at the hotel and that can mean 1 night, 2 consecutive nights, or 100 consecutive nights, etc.

That being said, this topic segues to the next topic.

When to take the bonus 5000, 10000, and so forth offers.

Sometimes the Best Flexible Rate comes with a deal like 5,000 bonus points per stay for like $15. The dollar amount is the per-night dollar amount added to the rate.

For instance, at Holiday Inn San Diego, the Flexible rate is $169.99 but you can get 5,000 per stay for $13 per night. So if you stay two nights, you can get 5,000 bonus points for your two-night stay for $182.99 per night. If you stay 10 nights, you would get 5,000 bonus points for the whole 10-night stay for $182.99 per night.  It does not matter how many nights there are in your stay, you only going to get 5,000 bonus for the entire stay.

Now there are deals like 5,000 for $10 to $25 per night at some hotels.  There is even a hotel that had 10,000 for $25 per night.  These per-night bonuses are worth it.

Here is my rule:  If there is a per-night bonus of 5,000 points or more for around $25 per night, take it.   If you’re offered a 5,000 or 10,000 points for $10 to $25 per stay and your staying one night, take the offer. Otherwise, forget the bonus points.

If you absolutely know for sure that you’ll be at the hotel…

The next best rate after the one-night stay with the 5,000 bonus points is the Book Early & Save rate. The catch is that it is a non-refundable rate.

For instance, for Holiday Inn San Diego Old Town, the Book Early rate is $131.99 per night.

When to redeem points

Before I mention my personal rule to redeeming points, let me explain what I do first.

I plan about six months ahead and I book refundable rooms at AAA rates. After the booking the rooms, I know the range of room rates that I’ll pay. As of this writing, the range is from $90 per night to about $134 per night. Afterwards, I look for hotels that offer 15,000 points per night.

As of this writing, the hotels that offer the 15,000 per night are slightly off-the-beaten path than where I want to be. However, I might be willing to go the extra mile to save money. Practically, I would be trying to save $130 per night for 15,000 points per night.

So here is my current rule: Try to find 15,000 point per night rooms that will replace the high-rate rooms. If the 15,000 point room is off-the-beaten path, then determine if it is worth going to the extra mile to save money.

What redemption rate to use

For the uninitiated, there are three options to redeeming points for rooms. You can pay for a room using only points, you can pay for a room using points plus $40, or you can pay for a room using points plus $70.

The following is an example:

15,000 points

10,000 points + $40

5,000 points + $70

So what is the best option?

The best options are in this order:

  1. 5,000 points + $40
  2. 10,000 points
  3. 5,000 points + $70
  4. Toss-up between 15,000 points and 10,000 points + $40
  5. Toss-up between 20,000 points, 15,000 points + $40, and 10,000 + $70.
  6. 25,000 points
  7. 20,000 points + $40
  8. 20,000 points + $70

This list of options are based on calculations.

The math behind the madness

One of the difficult things is trying to put a dollar value to a point. The point is like a currency with a varying earning rates and redemption rates.

Here is a breakdown of earning points at Holiday Inn and Holiday Inn Express.

  • 10 points per dollar spent for a night stay at Holiday Inn and Holiday Inn Express
  • 50% bonus points for the night stay if you’re a Platinum member.
  • 5 points per dollar spent if you use the IHG credit card for the night stay.
  • Points from IHG Rewards Club are not accrued from paying taxes such occupancy tax, city tax, and state tax. However, points from using the credit card does accrue from such taxes.

The following is a table that I calculated using a spreadsheet. The scenario is the following:

If you were to stay at a same hotel at the same room for X amount dollars until you exhausted all your money and points, the practical room rate is the how much you would practically spend per night. For example, if you had $10,000 to spend for the same room at the same rate and you redeemed earned points for rooms using the 5,000 point + $0 redemption option, you would stay a total of 79.57 nights and the room rate would break down to $125.68 per night.


Location:Holiday Inn Express – San Diego
AAA Rate:136.62
Total Cost:151.53
Est. Points Earned:2776
Spending budget:$10,000
redeemed pointsadded costnights spentpractical room rate per night


As you can see, the best option to use is the 5,000 + $40 option.

The following is an example why 1,000 bonus points per night for $5 per night is not worth it. Except for the 5,000 + $40 option, you would get fewer nights.

Location:Holiday Inn Express – San Diego
Flexible Rate:145.95
Bonus:1,000 per night for $5 per night
Total Cost:$169.91
Est. Points Earned:4,113
Spending budget:$10,000
redeemed pointsadded costnights spentpractical room rate per night


The following is why it is worth getting the bonus points if you’re staying one night. The following assumes that the person can check-in and check-out every night so that 5,000 per stay becomes 5,000 per night. The following example is fictitious but uses a tax rate comparable to taxes found in San Diego.

Location:Fictitious Holiday Inn in San Diego
Flexible Rate:$145.95
Bonus:5,000 per stay for $10 per night
Total Cost per night:$175.54
Est. Points Earned:8,216
Spending budget:$10,000
redeemed pointsadded costnights spentpractical room rate per night


The following is an example that the Book Early & Save rate is better than the AAA rate but not as good as the one-night with 5,000 bonus points per stay rate:

Location:Holiday Inn Express – San Diego
Book Early & Save rate:$127.62
Total Cost per night:$143.65
Est. Points Earned:2,632
Spending budget:$10,000
redeemed pointsadded costnights spentpractical room rate per night






Review: Chase IHG Rewards Club Select MasterCard

Link:  creditcards.chase.com/credit-cards/ihg-credit-card.aspx

This is an interesting card.  I got this card because I stay at Holiday Inn a lot.  I like Holiday Inn.  If you stay at Holiday Inn quite a bit (or even once a year), this is a card to get.

The rewards system goes by points and it is tied to the IHG Rewards Club program.  You don’t need the Chase card to join the program, but this Chase card can help you rack up points pretty quick.

At the time of this writing, the credit card has the following features:

  • Upon approval, you get 60,000 points if you spend $1,000 in the first 3 months,
  • The annual fee for the first year is waived. Afterwards, it is $49 per year.
  • Upon approval, you get one free night.
  • Every year you get a free night.
  • You get Platinum status in the IHG Reward Club program
  • 5 points per dollar spent at IHG hotels.
  • 2 points per dollar spent at gas stations, groceries, and restaurants.
  • 1 point per dollar for everything else.
  • You get 10% bonus points for points redeemed.
  • You get a $50 statement credit if you apply for the credit card through the IHG web site.

As an IHG Reward Club member, you get 10 points per dollar spent for the room rate (not including taxes and fees) at Holiday Inn. As a Platinum member you get 50% bonus points, so basically a Platinum is getting a total of 15 points per dollar spent for a room.

Note that just a free night every year with an annual fee of $49 is a good reason to get the card if you’re going to stay at Holiday Inn one night a year.

The following calculations assume that are a Chase IHG credit card member. So let’s go straight to the guts of the points system…

Earning points by staying at Holiday Inn

The objective is to get the most nights for a certain amount of money.

So let’s say you have a budget of $10,000 for hotel stays. If you stay at Bonita Springs at $119.87 per night and earn 6935 points per night, you would spend for 83.42 nights and you would earn 578,532 points. The next step is tricky. At redemption rate of 15,000 points per night, you would get 38.569 bonus nights, but you also get 10% bonus points for points redeemed. So you would get 57,854 bonus points. That amounts to 3.86 more bonus nights for a total of 42.43 bonus nights. Let’s go one more step with the 10% bonus, when redeeming points for 3.86 nights, you get 5,790 more bonus points, and that amounts to 0.386 additional nights for a total of 42.82 nights. You can keep doing the 10% step but to save you the math, the total nights is 42.85 bonus nights. So for $10,000, you can stay a total of 126.27 nights (83.42 + 42.85 = 126.27) at a rate of $79.19 per night ($10,000/126.27 nights = $79.19 per night).

If you redeem using the 10,000 points plus $40 option, (doing quite a bit of algebra) you spend for 66.36 nights and get 51.13 bonus nights for a total of 117.49 nights. (66.36 paid nights x 6935 points per night = 460,206 earned points. At a redemption rate of 10,000 points per night, 460,206 points/10,000 points per night = 46.02 bonus nights plus 46,020 bonus points. 46,020 points/10,000 = 4.60 bonus nights plus 4602 bonus points. 4,602/10,000 = 0.46 bonus nights plus 460 bonus points. Etc,etc,etc. Total bonus nights = 46.02+4.60+0.46+0.05= 51.13 bonus nights. 66.36 paid nights x $119.87 per night + 51.13 bonus nights x $40 = $10,000). You’re practically paying $85.11 per night.

If you redeem using the 5,000 points plus $70 option, you spend for 43.91 nights and receive 67.67 bonus nights for a total of 111.58 nights. You would practically be paying $89.63 per night.

It doesn’t matter whether you’re spending $10,000, $1,000,000, or $200 for hotel stays, the practical rate is the same.

The following chart is an example of staying at Buena Park, CA Holiday Inn with a hotel budget $10,000.

Location:Buena Park, CA
Room Rate:$119
Bonus Points:5000 points for $10
Total Cost plus tax:$144.53
Est. Points Earned:7430
Redemption Options:Paid Nights:Bonus Nights:Total Nights:Practical Room Rate:Discount:

Let’s understand the chart. Let’s say a person spent $10,000 spending at a room rate of $144.53 per night with 5,000 bonus points per night. The person then redeems the earned points at a redemption rate of, let’s say, 20,000 points plus $40 per night. Once the person has exhausted the $10,000 budget and all the earned points, he would have spent for 62.10 nights and received 25.63 bonus nights for a total of 87.73 nights. For $10,000, the person stayed 87.73 nights at a rate of $113.99 per night which is a 21.13% per discount from the original cost of the room.

According to the chart, the best practical room rate is $93.22 per night at discount of 35.50%. The person would need to redeem all his points using the 15,000 points per night option. He would get a total of 107.27 nights. The worst redemption option is the 25,000 plus $70 with a rate of $113.34 per night at a discount of 12.80%. He would get a total of 88.23 nights. The difference between the best and worst option is about 19 nights. That is a lot of nights.

As you might have guessed, the best redemption options are the bottom three, the best being the straight 15,000 points per night option.

Let’s compare between a room rate with 5,000 points, AAA rate, and the cheapest room rate at Palm Desert, CA

Location:Palm Desert, CA
5000 pt optionAAA rateCheapest rate
Total points earned:707519201560
Total Coast plus taxes:$128.79$107.51$89.59
Redemption Options:Practical RatePractical RatePractical Rate



This chart shows that you’re better off getting the cheapest room rate.

As an exercise, let’s says you want accrue 35,000 points using the 5000 bonus points option and then redeem the 35000 points for a night somewhere. Let’s first try by staying at a 5,000 bonus point room. At Palm Desert at 7075 points per night, you need to stay about 4.94 nights, so you’re going to spend $128.79 x 4.94 = $637.12 to get 35,000 points. With the 35,000 points, you get one bonus night, so you’re spending $637.12 for 5.94 nights at a rate of about $106.19 per nights. (I am not taking into account the 10% bonus points for each redemption.)

Let’s say you want to stay at Miami Beach for 35,000 points. The cheapest rate for the same room is $178.99. By spending the 5000 bonus point room rate, you’re spending $637.12 to spend 4.94 nights at Palm Desert and one night at Miami Beach.

Now, let’s go for the cheapest room rate. 4.94 nights at Palm Desert at the cheap rate of $89.59 per night costs $442.57. Spend $178.99 for one night at Miami Beach, and your total cost is $621.56. You’re better off getting the cheapest room rate for both hotels. Not only are you saving money going from the cheapest room rate, but you’d still have the points from the night stays at Palm Desert and Miami Beach (about 10,874 points), where as you would have 10% bonus points (3,500 points) from the redemption from the night stay at Miami Beach using the 5,000 bonus points route.

Before you think the cheapest room rate is the way to go, check out the room rates at Buena Park.

Location:Buena Park CA
5000 pt optionAAA rateCheapest rate
Total points earned:743022802160
Total Coast plus taxes:$144.53$127.73$121.01
Redemption Options:Practical RatePractical RatePractical Rate


This chart shows that the best room rate depends on what redemption rate you normally do. If you always redeem in the bottom six options, the 5000 bonus point room rate is the way to go. Except for 25,000 points, if you redeem using the upper 8 options, the cheapest room rate is the way to go. The AAA rate is never the way to go because the cheapest room rate has a lower practical rate. It is going to be between the 5000 bonus point rate and the cheapest rate.

Let’s go back to the previous example with the night stay at Miami Beach using the Buena Park room rates. Doing some quick calculations, you would need to spend 4.71 nights at $144.53 per night for a 5000 bonus point room at Buena Park and get one free night at Miami Beach for a total of $680.82 and you would get 3500 points left over. If you go the cheap route, you would spend 4.71 nights at $121.01 per night at Buena Park and one night at $179.99 per night at Miami Beach for a grand total of $749.95 and you’d have 13342 points left over. So here is the trade off – you would spend $70 less money going the 5000 bonus point route, but you would get 10,000 more points going the cheap route. It is like the value of 10,000 points is about $70 (which by the way is what you spend to buy 10,000 points when you redeem points). If you look at the Buena Park chart, the practical value of a room of both the 5,000 bonus point room rate and the cheapest room rate is pretty close ($116.95 vs $113.24).


Earning Rate from 1x and 2x points per dollar spent

Let’s look at two forms ways of earning points. First, you get 2 points per dollar spent on gas, groceries, and restaurants. Second, you get 1 point per dollar spent on everything else.

The objective here is to spend the least amount of money in order to get a room. Here is a chart that shows the spending cost for each redemption option at 2 points per dollar earning rate. I also looked up the cheapest rates at 4 Holiday Inn locations.


Bonita SpringsLa MiradaAnaheim FullertonMiami Beach
Room cost$84.36$113.30169.39195.49
Redemption Optiontotal spending cost @ 2 points per dollarearning rateearning rateearning rateearning rate


To help understand the chart, let’s say you spent $10,000 on gas, groceries, and restaurants earning 20,000 points. For $40 additional, you would be eligible for the 20,000+$40 option. If you redeemed for a night at Bonita Springs which costs $84.36 per night, the redemption rate based on dollars is 0.84% ($84.36/$10,040 = 0.84%). Basically you spent $10,040 to get a $84.36 room.

The idea is to get a room for the least amount of money. By looking at the table, you would get the best earning rate at the 5,000 plus $70 option. Unfortunately, not every hotel offers a 5,000 plus $70 option. For instance, the best option Miami Beach offers is 25,000 plus $70, so you would have to spend $10,070 in order to use the option. The redemption rate would be 1.94%.

So what is a good redemption rate in terms of percentages? It depends on what other credit cards you have. For example, if you have the Barclaycard Arrival card with the intent of redeeming points for travel (2.22% earning rate), the redemption rate has to be greater than 2.22% to make it worth your while to redeem IHG points. Otherwise, buy the room using the Barclaycard. If you have the Capital One Quicksilver card, the redemption rate to beat is 1.5%; if greater than 1.5% use the IHG points. If you have the Chase Freedom or the Discover card, the redemption rate to beat is 1%.

Here is a table for 1 point per dollar spent and the redemption percentages:

Bonita SpringsLa MiradaAnaheim FullertonMiami Beach
Room cost$84.36$113.30169.39195.49
Redemption Optiontotal spending cost@ 2 points per dollarearning rateearning rateearning rateearning rate



If you just got the card and received 60,000 free points, use the 5,000 plus $70 option for rooms greater than $100. Or use the 10,000 plus $40 option for rooms between $84 and $100. The points are free and you would be getting a room at a discount.

If you going to redeem 2x points for rooms, figure out what the earning rates are on your other credit cards and check if you can beat it using the IHG card. Here is a chart to help.

Total Room cost$75.00$100.00$125.00$150.00$175.00$200.00
Redemption Optiontotal spending cost @ 2 points per dollarearning rateearning rateearning rateearning rateearning rateearning rate


To maximize your nights at Holiday Inn, follow the following rules:

  1. Calculate 68% of the total cost of the 5000 bonus point room rate. You’re basically calculating the room rate at a 32% discount. You are approximating the lowest practical rate of the 5000 bonus point room rate (the practical rate at the bottom 3 redemption levels).
  2. If the result is close or greater than the cost of the cheapest room rate, go with the cheapest room rate. This is because the practical rate of the cheapest room rate is going to be lower than the lowest practical rate of the 5000 point bonus room rate. If the 32% discount rate is well lower than the cheapest room rate, go to the next step.
  3. If you redeem the bottom 6 options all the time, go for the 5000 point bonus rate.
  4. Otherwise, go for the cheapest room rate.