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Update November 12th, 2011: Unfortunately, the 50,000-mile Southwest credit card deal is no longer available – it only gives 25k. As a replacement, we suggest the Chase Sapphire Preferred, which has a 50,000 Ultimate Rewards Point signup bonus worth $625 of travel and, unlike the Southwest Rapid Rewards card, has no foreign transaction fee and no annual fee in the first year. Another option is the British Airways credit card, which has a 50k-mile signup bonus as well and which earns better rewards than the Sapphire.
The newest Southwest Airlines Credit Card from Chase offers 50,000 SWA miles as a signup bonus. That’s worth over $800 in Wanna Get Away (economy) fare, enough for two roundtrip domestic flights. The new Southwest credit card joins Chase’s already-extensive list of credit cards with hefty signup bonuses. In addition to earning 25,000 free miles with your first purchase, you earn 3,000 Rapid Rewards points on every anniversary of your card membership ($50 in Wanna Get Away fare), which all but knocks out the $69 annual fee. Unlike most rewards cards, the Southwest doesn’t require you to spend, say, $5,000 in 3 months to get the bonus. It’s given right after your first purchase.
Chase is dominating the NerdWallet blog with its huge signup bonuses. They seem to have a rotating set of cards that ups the bonus for a little while before dropping back, so make sure to jump on them while they’re still available. Among Chase’s recent bombshells:
Southwest Airlines credit card 3.0
Like its predecessor, the Southwest Plus gives 2 points per $1 spent on the airline and 1 point elsewhere. The main selling point is its bonus, a whopping 50k miles, or $800 in Wanna Get Away fare. The annual fee, $69, is offset by an anniversary credit of 3,000 miles worth $50 in WGA fare. That bonus puts it well ahead of most other airline-specific credit cards, whose bonuses reach 30,000 miles on the high end. How does it compare to the two other travel card heavyweights, the Chase Sapphire and Capital One Venture?
Capital One Venture Rewards
The Capital One Venture‘s got a few advantages on the Southwest credit card:
- The Venture gives 2% back on all purchases, not just Southwest ones.
- The Venture’s $59 annual fee is waived the first year, but the Southwest’s $69 fee isn’t.
- Venture waives its foreign transaction fee, while the Southwest card charges 3%.
- You can use your miles for any travel expense, from airfare to gas to hotel rooms, rather than being limited to one airline.
On the other hand, it’s hard to argue with $800, so we won’t.
Verdict: Southwest is the champion sprinter, but if you’re looking for a marathon, Venture’s your card.
Chase Sapphire Preferred
The Chase Sapphire makes a better case, because it’s got a really good signup bonus (50,000 Ultimate Rewards points, worth $625 if you redeem for travel), and gives 2x rewards on travel and dining. In the Sapphire’s favor:
- Annual fee waived first year
- Earns 2x rewards on dining and travel in general, a broader category
- You can redeem your points for more than just Southwest miles
But, on the other hand:
- Did we mention that the Southwest bonus is worth $800?
- Lower annual fee: $69, compared to $95
- 3,000-mile anniversary bonus lowers the annual fee to effectively $19
Verdict: A frequent Southwest traveler, or someone who doesn’t spend as much, will prefer that card, while a big spender or someone who travels many airlines will prefer the Sapphire.
Overview: Southwest Rapid Rewards program
Southwest shook up its rewards program (for the better, we think). You earn points based on the ticket’s price with a fare class multiplier:
- Wanna Get Away: ticket price x 6
- Standard: ticket price x 10
- Business Select: ticket price x 12
Redemption is also tied to fare. The cost of the ticket is ten times the earning rate, so you’d redeem 120 points for $1 towards a business select ticket, 100 points towards standard, and 60 points toward Wanna Get Away. This means your 50,000 signup bonus is worth:
- $833 in Wanna Get Away fares
- $500 in standard fares
- $417 in business select fare
One thing that’s great about the Southwest Airlines Rapid Rewards program is that they don’t cheat you by sticking you with taxes and fees. Most airlines credit cards let you use your miles to pay for airfare, but charge you for the fees that can run upwards of $50 per domestic trip or $100 internationally. Southwest doesn’t have such gimmickry. You’re only on the hook for the September 11th security fee, only $10 roundtrip.
Plus, Southwest is a nice airline in itself. It doesn’t charge change fees, lets you check two bags for free, and is a generous provider of drinks and peanuts. Rapid Rewards Points are also flexible. They have no blackout or expiration dates, and have no limits on how much you can earn or redeem in a given year.
The Southwest Airlines Rapid Rewards Plus is a Visa Signature, so you get a suite of network perks like accident insurance, lost or damaged luggage reimbursement, and rental car insurance. Visa has a number of experience benefits, like free wine tastings in Sonoma and free upgrades with partner hotels.
Verdict: Southwest is a great airline, and if you’re a fan of their no-frills, low-cost, tongue-in-cheek style, you’ll be even happier about this 50k-mile bonus.