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Southwest Rapid Rewards Premier vs. Chase Sapphire Preferred: Loyalty Has Great Benefits

Airline Credit Cards, Credit Cards
Southwest Rapid Rewards Premier vs. Chase Sapphire Preferred: Loyalty Has Great Benefits
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For fans of Southwest Airlines, the Southwest Rapid Rewards® Premier Credit Card and the Chase Sapphire Preferred® Card are both enticing. The first offers generous loyalty benefits, including anniversary bonuses and a faster way to earn a companion pass. The latter gives you more flexibility in redeeming rewards and lets you transfer points to Southwest’s frequent flier program on a 1:1 basis. Their similar rewards structures can also make it hard to pick a winner.

A closer look at these cards, however, reveals that for regular Southwest travelers, the Southwest Rapid Rewards® Premier Credit Card is miles better than the Chase Sapphire Preferred® Card.

How the Southwest Rapid Rewards® Premier Credit Card wins

Let’s start by comparing these cards’ features side by side.

 Southwest Rapid Rewards® Premier Credit Card Chase Sapphire Preferred® Card
Sign-up bonusEarn 40,000 points after you spend $1,000 on purchases in the first 3 months your account is open Earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $625 toward travel when you redeem through Chase Ultimate Rewards®
Rewards2 points per $1 spent on Southwest Airlines and participating hotel and car rental partners

1 point per dollar on everything else
2 points per $1 spent on travel and dining

1 point per dollar on everything else
Annual fee$99 $0 for the first year, then $95
Foreign transaction feesNoneNone
Other benefitsYou earn 6,000 points automatically after your cardholder anniversary each yearYou can transfer points on a 1:1 basis to several airline and hotel partners, including Southwest

Here’s why the Southwest Rapid Rewards® Premier Credit Card comes out ahead:

It offers more long-term value. Both cards offer a sign-up bonus, as do many other travel cards. But the Southwest Rapid Rewards® Premier Credit Card also gives you a 6,000-point anniversary bonus every year just for holding the card. This bonus, worth $60 according to NerdWallet valuations, cancels out the better part of the card’s $99 annual fee. It’s also enough to nab you one of those super-cheap one-way tickets Southwest offers during its flash sales.

Even with the annual bonus, you’ll still have to spend at least $1,950 to break even on the Southwest Rapid Rewards® Premier Credit Card’s annual fee. Though the Chase Sapphire Preferred® Card waives its annual fee the first year, after that you’ll have to spend nearly twice as much as you would with the Southwest Rapid Rewards® Premier Credit Card to come out ahead.

The sign-up bonus is easier to earn. Both cards offer top-notch sign-up bonuses. But the bonus on the Southwest Rapid Rewards® Premier Credit Card doesn’t require you to spend as much. You’d have to spend twice as much in the first three months to earn a bonus on the Chase Sapphire Preferred® Card.

You’ll earn that companion pass faster. To qualify for Southwest’s sought-after companion pass — an ID card that lets another person fly with you for free for as long as almost two years — you need to earn 110,000 qualifying Rapid Rewards points. The bonus points on the Southwest Rapid Rewards® Premier Credit Card count toward that total. Points transferred from the bonus on the Chase Sapphire Preferred® Card do not, according to the fine print on Southwest’s website.

If earning a companion pass and saving thousands of dollars on travel costs is your endgame, the Southwest Rapid Rewards® Premier Credit Card is your better bet. The current sign-up bonus will give you a good start.

» MORE: How to earn a Southwest companion pass

Why you still might want to go with the Chase Sapphire Preferred® Card

If your trips aren’t “all Southwest, all the time,” the Chase Sapphire Preferred® Card might be a more useful card. Here’s why.

It offers more redemption options. While Rapid Rewards points can be redeemed for some international flights with partner airlines through Southwest’s portal, they can’t be transferred to other loyalty programs. Chase Ultimate Rewards points, on the other hand, have plenty of redemption options. You can transfer points to several airline and hotel partners on a 1:1 basis. Those partners include Southwest, but also United, British Airways, Air France/KLM, Marriott and Hyatt, among others. Alternatively, you could book travel directly through Chase’s travel portal at a value of 1.25 cents per point. And if you’re not in the traveling mood, you could opt for cash back and get 1 cent per point.

It waives the first annual fee. Sign-up bonuses are always a little sweeter if you don’t have to pay an annual fee for your card in the first year. Unlike the Southwest Rapid Rewards® Premier Credit Card, the Chase Sapphire Preferred® Card waives the fee in the first year. If you plan to hold the card for just a couple years, tops, this could make it a better option.

The bonus categories are broader. The ongoing rewards for the Chase Sapphire Preferred® Card and Southwest Rapid Rewards® Premier Credit Card are modest. If you don’t spend much in any bonus categories — that is, travel, dining, Southwest Airlines and certain hotel chains and car rentals — the distinction is moot. But if you plan to spend about $3,000 a year more on dining and travel compared with what you plan to spend on hotels, car rentals and Southwest flights, go with the Chase Sapphire Preferred® Card.

Southwest fliers: Go for the Southwest Rapid Rewards® Premier Credit Card

If you fly with a different airline every time you travel, the Chase Sapphire Preferred® Card would be a smarter choice.

But the no-frills Southwest Rapid Rewards® Premier Credit Card offers better value for Southwest enthusiasts than the Chase Sapphire Preferred® Card. Its anniversary bonuses will help you earn points faster, and its sign-up bonus can help you lock down a companion pass in short order. Coupled with the benefits the airline offers to all customers — such as no fees for checked baggage or flight changes — it’s a clear winner.

Claire Tsosie is a staff writer at NerdWallet, a personal finance website. Email: claire@nerdwallet.com. Twitter: @ideclaire7.