An Unfortunate Lesson in Option Value

I'm a consultant, and as a consultant, I'm also a major points-hoarder.

Doesn't matter what or where, if it's got a program that'll get me anything of value, I'm in.

Airlines, Hotels, Rental Cars...

I would register for a Red Lobster rewards program if its platinum level came with extra portions during Shrimpfest.

But my true points hoarding heart belongs to hotel programs. Starwood and Hyatt are my two chains of choice, and I constantly go back and forth like a mixed up tween choosing between Team Edward and Team Jacob (note: I know this is from Twilight, but I'm still not clear on who these people are, or why I should pay attention to vampires. I feel like it's an apt analogy nonetheless)

I'm fairly in the Starwood camp at this point, because that's what a lot of more senior consultants have told me, and the SPG Amex is a pretty good card if you don't care about the nominal annual fee.

Anyway, this is to set up the fact that I track their promotions fairly closely. Recently, Starwood offered a new one. With five stays at their hotels, you could have any one of three reward options.

Option 1 - 4,000 SPG points

Option 2 - Something like a restaurant gift certificate, I don't recall, it was a bad option

Option 3 - 25% off a points redemption at a Starwood property.

The choices were offered to you at the SPG promotion registry website, and you had a few weeks or so to make your choice. You could only choose one option, and once you made it, it was irreversible.

Now, I could have waited a while before making an award selection. I had the option to sit back until the end of the registration period, then at that time, make a choice to maximize my future reward. It was available at no additional cost, except that I would need to remember to physically register for something.

I sat there and debated in my head.

Am I really going to be in a position where I need to use points and will need the reward? I can't think of anything. Of course, I could wait, but then I might forget. The 4,000 SPG points is pretty tempting, I can always use more points and they never expire. The redemption coupon has an expiration. I kind of just want to make a decision and stop thinking about it.

So I did stop thinking about it. I picked the 4,000 points. Option to decide in the future forfeited.

Flash forward 6 weeks or so.

I'm sitting with my fiancee in our new apartment, and we're thinking about our honeymoon destination. We've settled on Hawaii, and I start to look into hotels that I can book using points.

I book one five night block at a really nice looking St. Regis in Kauai. That's a pretty hefty number of points, but it's a really nice hotel (or so I've been led to believe). Then I look to book some nights in Maui, and it hits me.

The Westin in Maui costs 12,000 points per night. You get a fifth night free with a booking, so for five nights it would come to 48,000 points.

Oh crap, I realize, that redemption coupon I passed up.

The coupon would've gotten me 25% off in points, turning it from a 48k requirement to a 36k requirement. It would've been worth 12,000 points.

Of course, I had just cashed it in for 4,000 points straight up.

Doh.

I tried to get it changed, but given my hotel-switching prowess, I had already racked up the necessary 5 stays and had already been credited with the bonus points. Even if I hadn't, the promotion specifically didn't allow any changes after a selection (because you would obviously change it to a coupon if you realized you could use it and it would be financially beneficial)

Sigh. Looks like I'll have to keep throwing the Starwood Amex around. My kingdom for another 48k SPG points.