Southwest is selling points with a 75% bonus, but you’ll still lose money

Apr 22, 2021

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Southwest Rapid Rewards is a revenue-based loyalty program where the amount of points required for an award flight is dictated by the revenue cost of the flight you want to book. Fresh off this month’s devaluation, it will take roughly 83 Rapid Rewards points per dollar of airfare to book an award flight. This makes a Rapid Rewards point worth about 1.2 cents per point (give or take a bit depending on some airfares).

Starting today through May 28, you can buy points with up to a 75% bonus:

If you buy the maximum allowed in this promotion, you’ll end up paying $1,650 for 105,000 points making the cost 1.57 cents per point. 

If you can only redeem points for 1.2 cents per point, but have to pay a minimum cost of 1.57 cents per point, you’re never going to come out ahead. It makes more sense to take your $1,650 you would spend on points and buy the revenue tickets from Southwest – which will earn your redeemable points as well as progress towards status and the Companion Pass. Purchased points do not count towards A-List status or towards earning the Companion Pass.

The only time I can think where it would make sense to buy a revenue-based loyalty program’s points is if you’re just short of a reward and need to top up an account to save yourself considerable money. Even then, a savvy TPG reader would have a stash of Chase Ultimate Rewards ready to be transferred over to your Rapid Rewards account so you don’t need to spend any money to top up an account or get a Southwest award flight.

75% is a good bonus, but the math still doesn’t work in your favor.

Featured photo courtesy Edward Russell/TPG.

Chase Sapphire Preferred® Card

WELCOME OFFER: 80,000 Points

TPG'S BONUS VALUATION*: $1,650

CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners

*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.

Apply Now
More Things to Know
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 when you redeem through Chase Ultimate Rewards®. Plus earn up to $50 in statement credits towards grocery store purchases within your first year of account opening.
  • Earn 2X points on dining including eligible delivery services, takeout and dining out and travel. Plus, earn 1 point per dollar spent on all other purchases.
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,000 toward travel.
  • With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories.
  • Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash's subscription service. Activate by 12/31/21.
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
  • Get up to $60 back on an eligible Peloton Digital or All-Access Membership through 12/31/2021, and get full access to their workout library through the Peloton app, including cardio, running, strength, yoga, and more. Take classes using a phone, tablet, or TV. No fitness equipment is required.
Regular APR
15.99%-22.99% Variable
Annual Fee
$95
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent/Good

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