Is Southwest More Rewards a good use of points?
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You may still be racking up Southwest Rapid Rewards points even if you aren't traveling. It's possible to earn Southwest elite status through credit card spending. So, you may be watching your Rapid Rewards balance steadily grow even as you isolate at home.
Not surprisingly, the best way to use Southwest points is to book Southwest flights. But, perhaps you aren't comfortable booking travel now. Or, you've found yourself with a wealth of travel rewards but limited cash. In either case, you might be looking at other redemption options through Southwest's More Rewards program. So, today let's take a closer look at this program and whether it's a good way to use your Southwest points.
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What is More Rewards?
Southwest's More Rewards program lets Southwest Rapid Rewards credit cardholders use their points for more than just Southwest flights. Specifically, you can use the More Rewards program to redeem Southwest points for:
- International flights operated by other airlines
- Hotel and resort stays
- Gift cards
- Rental cars
- Travel insurance
- Experiences and packages
- Donation to feed rescued puppies
Of these options, cruises, experiences and packages aren't bookable online. Instead, you must call the partner travel agency to price out these options using your points. And, the travel insurance option repeatedly timed out for me. So, it may not be possible to buy travel insurance using your points right now.
Finally, don't get too excited about these redemption options just yet. As I'll discuss later in this guide, some options provide relatively little value for your points. As such, it's worth considering the value you'll get from these redemptions before using your points.
Which cards are eligible?
To use Southwest's More Rewards program, you must have a Southwest Airlines Rapid Rewards credit card. Consumer and business credit cards are eligible, though. So, if you have a Southwest credit card tied to your Rapid Rewards account, you should be good to go.
However, if you don't have a Southwest credit card that earns points for your Rapid Rewards account, you may want to apply for a new card. Specifically, you may want to consider adding one of the following to your wallet:
- Southwest Rapid Rewards Plus Credit Card: Best for Southwest flyers who need a low annual fee ($69 annual fee)
- Southwest Rapid Rewards Premier Credit Card: Best for causal Southwest flyers ($99 annual fee)
- Southwest Rapid Rewards Priority Credit Card: Best for frequent Southwest flyers ($149 annual fee)
- Southwest Rapid Rewards Premier Business Credit Card: Best for Southwest business travelers ($199 annual fee)
- Southwest Rapid Rewards Performance Business Credit Card: Best for Southwest business travelers that need a lower annual fee ($99 annual fee)
I have the Southwest Rapid Rewards Premier Credit Card and although it has a $99 annual fee, I get 6,000 Southwest points each year on my cardholder anniversary. And, based on TPG's valuations, these points alone are worth $90. So, since I easily get $9 of value each year from the card's other perks, it's an easy choice for me to keep it long term.
How much are my Southwest points worth?
TPG's valuations peg the value of Southwest points at 1.5 cents each. But, this assumes you'll use your points to book Southwest flights. So, let's consider the value you'd get when using your Southwest points through the More Rewards program.
Merchandise and gift cards
First off, I considered three different merchandise items. For each item, I compared the points cost through More Rewards to the cost I'd pay on the brand's website. Here's what I found:
- The North Face Ladies Resolve 2 Jacket: 14,157 points or $90 (0.64 cents per point)
- YETI Rambler® 20 oz. Tumbler: 5,849 points or $30 (0.51 cents per point)
- Bose Noise Cancelling Wireless Headphones 700: 62,745 points or $380 (0.61 cents per point)
So, using Southwest points to buy merchandise through More Rewards doesn't provide even close to TPG's valuation of 1.5 cents per point. Likewise, if you use Southwest points to buy gift cards through More Rewards, you'll only get a redemption value of 0.83 to one cent per point.
As such, I recommend saving your Southwest points until you book your next Southwest flight. But, if cash is tight and you need to redeem your points now, look for a gift card that provides a redemption value of at least one cent per point.
Next, I considered the travel options available through More Rewards. When you search through More Rewards, you won't see any cash prices. So, I compared the points costs listed to publically available rates found on the travel provider's website. In doing so, I found you can book flights on routes that aren't covered by Southwest at a rate of one cent per point.
You can also book hotels for about one cent per point. However, this assumes you'd book the standard publicly available rate directly with the hotel. But, most hotels also offer less expensive packages or member rates. So, I'd generally expect to get less than one cent per point when using points for hotel stays.
As you can see, none of the travel options available through More Rewards provide great value. As such, I wouldn't recommend using your Southwest points to book travel through the More Rewards program.
You'll get the best value from your Southwest Rapid Rewards points when you use them to book Southwest flights. So, I'd generally recommend saving your Southwest points to book flights once you're ready to travel again.
But, if you're short on cash and need to liquidate your Southwest points, you can do so using the More Rewards program. If you take this option, you'll want to purchase gift cards at a rate of one cent per point. Buying gift cards with your Southwest points won't yield TPG's valuation of 1.5 cents per point. That said, one cent per point is the best redemption rate you'll find through More Rewards.