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On Jan. 9, 2020, Chase announced that the introductory offer on all three personal Southwest credit cards will increase to 75,000 Rapid Reward Points. The frequent flyer program of Southwest Airlines is called Rapid Rewards.
The three credit cards with this increased welcome offer are:
Southwest Rapid Rewards® Plus Credit Card (Annual fee: $69)
Southwest Rapid Rewards® Premier Credit Card (Annual fee: $99)
Southwest Rapid Rewards® Priority Credit Card (Annual fee: $149)
Previous offer on all three cards: Earn 40,000 points after you spend $1,000 on purchases in the first 3 months your account is open.
New offer on all three cards: Earn 40,000 points after spending $1,000 on purchases in the first 3 months. Earn an additional 35,000 points after spending a total of $5,000 on purchases in the first 6 months the account is open.
While the initial part of this bonus is the same as before, you’ll need to spend an extra $4,000 to earn the incremental 35,000 Rapid Reward points. Importantly, this bonus offer still counts toward the Companion Pass, which is an excellent perk that allows you to select a companion to fly with you for free on a revenue or award ticket (after paying taxes and fees).
A Companion Pass is awarded after earning 125,000 points, so you will still need to earn an additional 45,000 Rapid Reward points after qualifying for this sign-up bonus.
That said, let’s take a look at why Southwest Rapid Reward points provide some valuable redemptions and what you can do to maximize your increased rewards.
Rapid Rewards basics
NerdWallet values Southwest points at 1.4 cents each.
Depending on how you redeem your points, you can expect to extract a value of 1.4 to 3 cents per mile on Southwest’s Wanna Get Away fares. Since Southwest mainly flies domestically, you will likely never see the very high cents-per-mile values that we sometimes get with international premium cabin awards on other carriers.
Unlike many airlines, Southwest doesn't use an award chart. Similar to JetBlue, the number of points required for a Southwest award flight is tied to the revenue cost of the ticket (excluding certain fees that are charged on revenue tickets but not on award tickets).
What is the welcome bonus worth?
After meeting the $5,000 minimum spend to earn the full bonus, you would end up with at least 80,000 Southwest Rapid Reward points (75,000 from the sign-up bonus plus 5,000 from spending you had to complete to earn it).
Assuming you could redeem at the low end of NerdWallet’s valuation, these 80,000 points are worth $1,200 in flights. If you ultimately earn the Companion Pass, these points become a lot more lucrative.
Chicago to Fort Lauderdale
Want to get away from the cold for a long weekend in January? A nonstop round-trip flight from Chicago-Midway to Fort Lauderdale costs 19,095 points + $11.20 in taxes.
If you were to pay in cash and snag a Wanna Get Away fare, that same ticket would set you back $292.
This redemption gets you just about 1.5 cents per point; if you redeemed all your points similarly, the introductory bonus would be worth four round-trip flights.
New York to Denver
If you like the cold and are considering a ski trip, you could book a round-trip award ticket from New York-LaGuardia to Denver during peak ski season for 11,476 points + $11.20 in taxes.
The same flight costs $187 if paid in cash.
Using points again results in a value of 1.5 cents per mile, but the cheaper flight means your welcome bonus could be worth seven similar round-trip flights.
» Learn more: Your guide to booking award flights on Southwest
Unique Southwest benefits
A lot of Southwest’s value is derived from its special perks. Here’s what we mean:
1. No cancellation fees on award or revenue tickets
As long as you cancel your ticket at least 10 minutes before departure, you can get a refund (or credit toward a future flight), whether you paid in cash or points. Southwest effectively treats tickets like they are refundable, which is a much more flexible policy than you’ll find on other major U.S. airlines.
Delta Air Lines, for example, charges a $200 cancellation fee (depending on your status level) on nonrefundable tickets if the ticket is canceled after 24 hours of booking. In addition, Delta charges non-elite flyers a $150 award redeposit fee, and tickets canceled less than 72 hours from departure are nonrefundable. American Airlines and United Airlines also charge high cancellation fees for nonrefundable tickets. To avoid these fees, you’d need to purchase a refundable economy ticket, which in many cases is extremely expensive.
2. Two free checked bags
Even without elite status, Southwest allows you to check up to two bags for free (up to 50 pounds). In addition, you can also bring a small personal item and a carry-on bag. Comparatively, for non-elite flyers on domestic economy tickets, Delta, United and American all charge $30 for the first and $40 for the second checked bag, respectively. Carry-on bags are allowed on some tickets, but not on the most restrictive (e.g. basic economy). This Southwest perk is a big money saver if you like to travel with checked luggage.
If your choice is between flying with the major U.S. carriers or Southwest, the flexibility of canceling a ticket with Southwest along with two free checked bags is reason enough to give Southwest a chance.
When you incorporate these two unique benefits, your Southwest points can become a lot more valuable.
The bottom line
The limited-time introductory offer of 75,000 points on all three Southwest credit cards results in a redemption value of $1,200 once the minimum spend is met. If you can earn the Companion Pass, that redemption value increases considerably.
Given Southwest’s excellent cancellation policy and generous baggage allowance, flying on Southwest can be preferable to flying on economy with one of the legacy carriers, especially if you don’t have elite status. If you live in a city serviced by Southwest, now is certainly a good time to consider applying for a Southwest credit card.
How to Maximize Your Rewards
You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2020, including those best for:
Airline miles and a large bonus: Chase Sapphire Preferred® Card
No annual fee: Wells Fargo Propel American Express® card
Flat-rate rewards with no annual fee: Bank of America® Travel Rewards credit card
Premium travel rewards: Chase Sapphire Reserve®
Luxury perks: The Platinum Card® from American Express
Business travelers: Ink Business Preferred® Credit Card
Planning a trip? Check out these articles for more inspiration and advice: Find the best travel credit card for you Which Southwest credit card should you get? Earn more points and miles with these 6 strategies