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Southwest has just announced one of its most lucrative buy-points sales ever, offering Rapid Rewards members a 45% discount on all point purchases through June 25. Loyalty members who buy at least 2,000 points before that date will qualify for an additional one-time 45% discount on their next points purchase between July 1 and July 12. This discount brings the price down to just 1.51¢ per point. That's the lowest price we've ever seen Southwest sell points.
While this seems like an incredible deal at first glance, it may be worth thinking twice before pulling out your wallet. Southwest points currently have a fixed value of between 1.3–1.5¢ each. So, does it ever make sense to buy them for 1.51¢?
A Note on Buying Points
At AwardWallet, we don't generally recommend buying points and miles speculatively. Most loyalty programs sell points at a price point that makes it difficult to receive outsized value, so you're often better off holding onto your cash.
However, there are at least a few exceptions. The first is when you only need a few more points to complete a redemption you're planning. Buying points can make a lot of sense here since it's one of the fastest (and easiest) ways to top-off your account balance. The second is when buying the points necessary for an award flight you want to book is cheaper than paying the cash rate. Third, if you're struggling to meet a credit card sign-up bonus spending requirement, buying points can be a quick way to spend now for travel later.
Key Terms
- Point purchases between June 12 and June 25, 2020 (promotional period) will receive a 45% discount.
- Rapid Rewards members who purchase at least 2,000 points during the promotional period will be eligible for a one-time 45% discount on their next points purchase between July 1 and July 12, 2020.
- Loyalty members can buy a maximum of 60,000 points per day, with no annual maximum.
- Purchased points do not count towards A-List, A-List Preferred, or Companion Pass qualification.
- Purchased points may take up to 72 hours to post in the applicable Rapid Rewards Account.
- Transactions are non-refundable.
The 45% discount will save you over $740 on the maximum purchase of 60,000 points.
Buying Points with a Fixed Value
Southwest's loyalty program is a little different from the rest. In many ways, that's a good thing. For instance, you can redeem points for any flight with seats available, you can easily cancel or change your booking with class-leading flexibility, and every passenger can check two bags for free.
However, unlike some of the other major U.S. airlines, Southwest assigns a fixed-value to Rapid Rewards points. This means that the award price is directly tied to the revenue price, typically charging between 76–78 points per dollar.
After factoring in taxes and fees, you're currently left with a per-point value of 1.3–1.5¢. The advantage of this is that you'll never be left wondering if you're getting a good deal. The disadvantage is this precludes you from the ability to buy and redeem points for outsized value as you can with AA miles or Alaska miles.
Sample Redemption
Let's look at an example itinerary to see if buying Southwest points makes sense.
This non-stop itinerary from Atlanta (ATL) to Columbus (CMH) is going for a reasonable cash price of $38.98. If you were to book this flight with points, it would cost 2,253 points + $5.60.
If you were able to buy exactly 2,253 points at 1.51¢ a piece, it would cost $34.08. After adding the $5.60 security fee, you're left with a total cost of $39.68. That's 70¢ more than the cash price. Plus, by buying the flight with cash, you'll earn Rapid Rewards points from the flight. In this case (and likely most cases), you're better off paying the cash price.
There are two tips for maximizing your Southwest redemption value: buying cheap tickets on connecting itineraries.
When redeeming points for a flight, you don't have to pay the Passenger Facility Charge (PFC) that's collected by the airline and remitted to airports. On really cheap flights, the PFC can be a significant amount of the cash price. And, on connecting itineraries, you have to pay the PFC to multiple airports. Therefore, you might be able to get more than 1.5¢ from your Southwest points in the case of a cheap connecting itinerary.
Topping Off Your Account
One of the few circumstances where buying points can make sense is when you're just a few points shy of that next redemption, and you're on a time constraint. AwardWallet tracking shows that Southwest points are immediately deposited into a Rapid Rewards account. So, if a sale is ending soon and you don't want to pay the full cash fare, buying points to top off your account might make sense.
However, there's an even better solution to that problem. Southwest Rapid Rewards is a 1:1 transfer partner of Chase Ultimate Rewards. That means that points earned with the Chase Sapphire Preferred® Card or Ink Business Preferred℠ Credit Card can be transferred (instantly) to Southwest to top-off your account in a pinch. Since earning Ultimate Rewards doesn't necessarily cost you anything (apart from maybe an annual fee), it's a cheaper solution than buying Southwest points.
Maximize Your Purchase
Like many other loyalty programs, Southwest uses Points.com (a third party) to process point purchases. This means that although the purchase occurs on Southwest's website, it won't qualify for any travel category bonus offered by some credit cards.
In cases like these, we suggest that if you're going to make a purchase, use it towards a minimum spending requirement for a welcome bonus or use a credit card optimized for everyday purchases. Some of the best cards for that include:
- The Blue Business® Plus Credit Card from American Express
- Chase Freedom Unlimited®
- Citi® Double Cash Card
It's also worth noting that one of the payment options you're able to select is ‘Rapid Rewards Credit Card' when buying Southwest points. While not 100% certain, this should trigger the applicable multiplier for a Southwest purchase if you pay with a Southwest co-branded credit card. Those bonus points would change the math on the value you get from the purchase, so it's something to consider.
Other Ways to Earn Rapid Rewards Points
If you aren't as pressed for time, another way to build your stash of Southwest points is with a co-branded credit card. Chase offers a full portfolio of Southwest cards. Among the best of these offerings is the Southwest Rapid Rewards® Performance Business Credit Card. The current sign-up bonus offers 70,000 points after you spend $5,000 on purchases in the first 3 months, plus an additional 30,000 points after you spend $25,000 on purchases in the first 6 months.
That means that if you complete all the requirements, you'll have a stash of at least 125,000 Rapid Rewards points and will have qualified for the famous Southwest Companion Pass!
- 3X points per $1 spent on Southwest® purchases
- 2X points per $1 spent on social media and search engine advertising, Internet, cable and phone services
- 1X point per $1 spent on all other purchases
Bottom Line
Southwest doesn't offer a buy points promotion all that often. So, whenever one comes around, it's worth taking the time to look it over and do the math. But in this case—even with the best-ever 45% discount—you're still a lot better off acquiring Southwest points through co-branded credit cards, shopping portals, or converting Ultimate Rewards.
But if you're in a pinch and need the points quick, at least this discount allows you to snag them for (almost) face value.
Are there any other circumstances where buying Southwest points would make sense that I'm missing?
The comments on this page are not provided, reviewed, or otherwise approved by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.
I’ve bought Southwest points before, but I’m definitely not buying them now, I really don’t know when I’ll able to use them. Anyway some could find it rentable.
I wonder why airlines are offering point purchase sales when travelers very much resist against traveling.
wow so it seems like their points program isnt the best. seems like proper investigation needs to be done before buying points. this is a very good post and i will hold off on buying points with them.
SW has no business class and their award pricing is tied to the cash price so you’ll consistently get around 1.5cpp – certainly good but nothing lucrative if you’re used to large redemption rates.
Thank you for the analysis! Not reason to buy this at this promotional price.
Same here. I just do not find it comfortable nor safe to travel in 2020.
I love the work and effort that AW puts into these posts letting us know where to find the maximum value and what the sweet spots are. I never would have thought cheap flights with a layover would be a criteria but now I know.
It’s interesting, but you have to do the math before
Planning on holding off for now as no trips are currently in the works via Southwest.
Points promotions need to be properly analized. This one isnt worth it. Sometimes they might look like a risk and difficult to believe, that ones are the ones i like the most!
Beyond the fixed value of the points, it does not seem to me a good decision to buy miles in this context (in which unfortunately some companies will disappear after the covid 19 crisis)
I don’t think its worth it, I’d rather transfer points from my credit card to use them right before booking a flight instead of pre-paying in case I might book a southwest flight.
Not a good deal. This goes for Jetblue and most other airlines that have flexible point prices depending on the cash price.
Yeah I wouldn’t ever buy points unless you have an immediate need to use them. Buying them is converting the most liquid asset (cash) into the most illiquid (airline points).
I would generally choose a SW flight over other airlines due to their lack of baggage and seat fees, but would not buy points at any airline right now.
I wouldn’t buy points now, unless it is to top up for a very specific reward redemption. Even though it may be debatable depending on the price of the ticket.
It’s clearly really tough for the airline industry in this pandemic. The industry will clearly bounce back but is a question of timing… Providing the airlines stay solvent! I have to say I have been pleasantly pleased how the airlines that I had flights booked for have accommodated either a reschedule or refund. As they have treated me fairly I am more inclined to invest a few air miles which will help their cash flow and myself in the long run.
I think it only makes sense if you pay for the points purchase with a Southwest VISA card and you get the extra points for that also.
I’m going to give it a try as we are a family of 5 and it costs us a lot for airfare each time we travel.