"It's a five-star hotel!" But what exactly does that mean? And is a five-star hotel really worth a hundred dollars more a night than a three-star hotel? It doesn't help that the same hotel may have three different ratings depending on the travel website you visit or the tourist guidebook you read.

If you're blinded by these perplexing little stars, you're not alone. Read on to learn more about the intricate hotel star rating system.

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Star Light, Star Bright. Is That Hotel Rating Right?
The star rating system was designed to measure the quality of hotels. While you may assume a one-star rating means a "disgusting hole in the wall where illegal activities take place" and a five-star rating means "Oprah Winfrey stayed here and loved it," that's not always the case.

First of all, Europe and the U.S. use different hotel star rating systems. In Europe, hotels are generally rated on a four-star system, with four stars being the best hotel room money can buy. On the other hand, the U.S. uses a five-star system to rate hotels.

And there's more to these star ratings than meets the eye. A one-star rating doesn't always suggest a bloody shoot-out recently took place in the hotel - it may simply mean that the hotel offers basic rooms and limited amenities. (Find out how to have a fun and budget-friendly summer adventure in 7 Ways To Save On Summer Getaways.)

Reaching for the Stars
So, who determines how many stars each hotel receives? In Europe, local government agencies and independent organizations hand out star ratings to hotels. In the U.S., stars are rewarded by a variety of different groups, from travel guidebooks and national consumer travel associations to travel agencies and websites.

To make things more confusing, each travel website has their own hotel star system. So, the same property may receive three stars on Travelocity, five stars on Orbitz and four stars on Expedia. Luckily, most of these travel websites and associations provide a consumer guide to their personal hotel star rating system.

For the most part, the North American hotel star system breaks down like this:

One-Star Rating: The Bare Necessities
A one-star hotel is simply a place to rest your head for the night. Generally owned by a sole proprietor, these hotels offer modest rooms with nothing more than a bed and bathroom. There are no restaurants on site, but there should be one within walking distance of the hotel.

These hotels don't offer extra amenities or special services. In other words, you're not going to get a nightly turndown service with a Godiva chocolate on your pillow here. However, you should have access to nearby public transportation and reasonably priced meals and entertainment.

Two-Star Rating: A Few Extras
Although similar to a one-star hotel, a two-star hotel is generally part of a larger chain as opposed to privately owned. (Think Econo Lodge or Days Inn.) The accommodations are similar to a one-star hotel - simple and basic. However, two-star hotel rooms include a television and phone. . (If you're a long-time air traveler, you've probably noticed that flying means pulling out your wallet a whole lot more often. Find out what's fallen off the list of airline freebies in 7 Air Travel Perks That Used To Be Free.

Plus, these hotels typically offer an on-site restaurant or dining area and a daily housekeeping service. The front desk at a two-star hotel is usually open 24 hours a day

Three-Star Rating: Moving On Up
Three-star hotels are typically part of larger, first-class hotel chains, such as Marriott, Radisson and Double Tree. These hotels are generally more stylish and comfortable than one and two-star hotels, and they offer a wider range of services and amenities, which may include a fitness center, a pool, business services, an on-site restaurant, room service, conference rooms and valet services.

The hotel rooms are larger with higher-quality, contemporary furnishings and often include fancy extras like flat-screen TVs with extended cable. Three-star hotels are located near a major expressway and local attractions, and they are often geared toward business travelers.

Four-Star Rating: Upscale Comfort
Also known as superior hotels, four-star hotels are large, upscale establishments complete with first-rate service and tons of extras. The spacious rooms are beautifully designed with premium furnishings and include luxurious touches like lavish bedding and fine bath products.

Four-star hotels offer loads of special services and amenities, including concierge services, fine dining, multiple pools and hot tubs, high-class fitness centers, bell hops, room service, valet parking, day spas, limousine services and an array of special suites. (A staycation can be just as enjoyable as a vacation, and can enrich your life for the whole year. Find out more in 9 Summer Staycations That Feel Like Vacations.)

Five-Star Rating: G-L-A-M-O-R-O-U-S.
Now we're talking lifestyles of the rich and famous. Five-star hotels are the most luxurious hotels in the world. These fine establishments boast extravagant lobbies, unparalleled service and unequaled comfort. Five-star hotel are generally architectural works of art, featuring cutting-edge interior design and opulent furnishings.

As a guest in a five-star hotel, you will not have to lift a finger (except for when you hand over that platinum credit card, of course.) Many of these hotels provide their guests with a personal butler or designated concierge. The massive five-star guest rooms are glamorous and elegant, often including premium linens, a personal Jacuzzi tub, a large-screen Plasma TV with high-definition cable, a DVD player, high-speed internet access, fresh flowers, lavish bath products and speedy, around-the-clock room service.

For the most part, five-star hotels also offer gourmet restaurants, on-site entertainment, state-of-the-art fitness centers, multiple heated pools and hot tubs, valet parking, spa services, tennis courts and golf course access. Champagne wishes and caviar dreams!

There's no question that the hotel star rating system can be vague, confusing and downright arbitrary. However, with a little bit of research, it is possible to pinpoint the perfect hotel to suit your unique needs - and your budget.

While you're doing your hotel homework, you should also check out what other hotel guests have to say. Many travel websites include guest ratings in addition to their regular star ratings. Often, the best information comes straight from the horse's mouth.

Above all else, take hotel ratings with a grain of salt. You may not get a truly objective opinion on a hotel until you stay there yourself.

Don't miss what's happening this week in the financial world. Check out Water Cooler Finance: Everything Old Is News Again.

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