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Should I Pay to Transfer Points or Miles to My Account?

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TPG reader Krupa sent me a message on Facebook to ask about transferring points:

“I have A-list and Companion Pass status with Southwest. Meanwhile, my husband (who is my listed companion) has accumulated about 20,000 points in his Rapid Rewards account. It would cost around $200 to transfer them to me. Is that worthwhile?”

Most airline and hotel loyalty programs allow you to transfer rewards to friends and family, but many of them will make you pay for the privilege. For example, Southwest charges one cent apiece to move points between accounts. That price is fairly reasonable compared to some other airlines, but it still eats up a huge percentage of what those points are worth to begin with. Fortunately, there are less costly options.

One great aspect of the Southwest Companion Pass is that you can use it on any flight so long as there’s an empty seat. It doesn’t matter whether you pay with cash or points, and more importantly, it doesn’t matter who pays for your ticket. That means there’s no advantage to having Krupa book her own flight, so transferring her husband’s points is unnecessary. Instead, he can simply redeem them for an award flight in her name. Once she’s ticketed, she can then add him to the itinerary using the Companion Pass like normal.

This would also be the case even if the Companion Pass weren’t a factor, or if you were booking with another airline. Paying to transfer points and miles generally isn’t a good value, since you can simply book award travel for other people. The process is a little trickier for hotel rooms than for flights — since you often have to book in your own name and then add other guests to the reservation — but it usually works just fine.

Ultimately, paying to transfer points only makes sense in limited circumstances, like when you need to consolidate accounts for a specific award. For example, if you have 58,000 miles and you need 60,000 to book a flight, paying to transfer the last 2,000 from a friend’s account to yours might be worthwhile. Of course, that’s only true if you don’t have other options (like transferring points from another rewards program).

Not all
You can use the Southwest Companion Pass when using cash or points, even when someone else pays for your flight.

In that case, you should make sure the award you’re booking offers enough redemption value to justify the cost of the transfer. Paying $20 to book a $500 award is probably worthwhile, but paying $200 would be inefficient. At that price, you might as well just pay cash and save your rewards for a better opportunity.

Finally, keep in mind that some loyalty programs allow you to pool account balances or transfer points to family members for free. Southwest isn’t one of them, but make sure you know all your options so you can avoid paying when you don’t have to.

If you have any other questions, please tweet me @thepointsguy, message me on Facebook or send me an email at info@thepointsguy.com.

Southwest Airlines Rapid Rewards® Premier Credit Card

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  • Earn 50,000 points after you spend $2,000 on purchases in the first 3 months your account is open
  • Chip-enabled cards with 24/7 fraud monitoring
  • Points Don't Expire as long as your card account is open, No Blackout Dates, Bags Fly Free®
  • 6,000 points after your Cardmember Anniversary every year
  • 2 points/$1 spent on Southwest Airlines® purchases and participating Hotel and Car Rental partners
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Intro APR Regular APR Annual Fee Foreign Transaction Fee Credit Rating
N/A 16.24%-23.24% Variable $99 0% Excellent Credit