Who doesn’t love to travel? And who doesn’t love a good deal? Combine them, and I’m happier than I’d be in a room full of brownies!
This year, we did most of our sightseeing on foot. It was truly breathtaking (especially the switchbacks at higher elevations) and I’d love to hear your suggestions for future backpacking trips.
Next year, though, we’ll do at least some of our traveling with wings.
Luckily, we live in a city that’s a huge hub for Southwest Airlines, and it has nonstop flights to my husband’s hometown where we fly several times per year. So, when we heard about a credit card that would give us 50,000 Rapid Rewards points*, we were thrilled and I promptly ordered a few Lonely Planet guides from the library to search for more dream destinations.
And that was only the tip of the iceberg.
Many of my friends already have the Southwest Premier Card. Administered through Chase, it offers 50,000 bonus points if you spend $2000 in the first three months and has a $99 annual fee. At a value of approximately 60-110 points per dollar (we’ll use 60 for the calculations here), it’s a white-hot deal.
50,000 points/60 points per $1 = $833
$833 – $99 annual fee = $733 in free flights!
And it gets even better. You get two extra points for each $1 you spend on Southwest and Rapid Rewards hotels and car rentals, plus one point for each $1 you spend on everything else. Even if you buy groceries or use your card for non-travel related items, that’s 2000 more points.
2000 points/60 points per $1 = $33 in free flights!
$733 from above + $33 = $766 in free flights!
We jumped on this deal as soon as we heard about it last year. Woo-hoo!
Using Southwest Rewards Points
We’ve tried to use vouchers and rewards points with other airlines, but it was such a hassle that we gave up quickly.
However, Southwest makes using our points super-simple. There are no blackout dates, and since Southwest doesn’t assign seats, there are no seat restrictions. Even when we needed to change our flights, our points were refunded in full and we were able to use them on our new tickets.
Plus, we like Southwest because it flies where we want to go and doesn’t charge extra to carry on and/or check up to two bags per person.
The only out-of-pocket fees we paid were $5.60 per person per flight leg for the US government-assessed September 11 Security Fee, for which airlines are not allowed to accept payment in points.
If you’re still not impressed, just wait–it gets even better!
Surprisingly, while many of my friends had the Premier card, most had not even heard of the Plus.
50,000 points/60 points per $1 = $833
2000 points/60 points per $1 = $33
$833 + $33 – $69 annual fee = $797 in free flights!
So of course I got this card too.
While I got an amazing deal and a ton of free flights, I later learned that I could have been much, much smarter about it if I had timed it better.
Free Southwest Airlines Companion Pass
Did you know that if you accrue 110,000 Southwest Rapid Rewards points in a calendar year you get a free Companion Pass for the rest of that year and the entire following year? Holy moly!
So, if you apply for both the Premier and Plus cards in November or December and spend $2000 on each card by late December (think holiday gifts and donations!) or January, your bonus points should be awarded early in the new year.
50,000 points x 2 + 2000 points x 2 = 104,000 points
You’re only 6000 points away from a Southwest Companion Pass that’s valid for almost two whole years!
Unfortunately, I applied for my cards in different calendar years so the 110,000 point requirement started over on January 1 and I didn’t get a Companion Pass 🙁
Learn from my mistake and time your rewards properly to get the best deal.
Adding It All Up
With the Companion Pass, the value of your points doubles because you get two flights for the price of one!
$766 from Premier + $797 from Plus = $1563 in free flights!
$1563 x 2 when your companion flies free = $3126 in free flights!
Is it worth your time and effort to get over $3100 in free flights? You be the judge.
If you use up all 110,000 points, you’ll have to pay out-of-pocket for any additional flights for yourself, but you’ll still get a free companion ticket. If you fly frequently, the sky’s the limit (pun intended) for how much you can save!
Spending That $$$
I would never advocate spending money just to earn rewards, nor would I advocate applying for a credit card if you can’t or won’t pay the balance in full Every. Single. Month. The bonuses just aren’t worth what you’d pay in extra fees and interest, not to mention the toll financial stress will take on your life and health.
However, if you have big-ticket purchases you’re going to make anyway, why not get more bang for your buck?
You might choose to pay your health/auto/renters/homeowners insurance premiums by credit card. You can also use the cards to pay for medical bills, rent, property tax, income tax, daycare, and utilities, in addition to your usual spending on food and gasoline. Some companies might charge you an extra fee, so evaluate for yourself it it’s worth the bonus you’ll get.
Some people also reach the $2000 spending requirement by purchasing gift cards to stores they shop at frequently–such as your local grocery store or (my personal favorite) Costco–so they know the gift cards will be put to good use.
Hard-core credit card hackers find ingenious schemes to manufacture spending, though these methods often result in their accounts being closed. In the interest of ethics and simplicity, I don’t personally endorse these strategies.
After you receive your sign-up bonuses, don’t forget to cancel the cards to avoid next year’s annual fee. If you keep them open, you will receive annual bonus points approximately equivalent to the annual fee, but if you cancel your cards you’ll be eligible to reapply and get the sign-up deal again in two years.
If you apply for a set of cards and reach 110,000 points this winter, your companion pass will be valid through the end of 2018. Then, your significant other can apply for a set in the winter of 2018 and get a companion pass that will last through the end of 2020. Repeat the process every two years and you’ll fly nearly free for life!
Do you have a Southwest Companion Pass? My husband just got his, so as long as I’m nice to him he’ll let me be his companion. Where should we go next year?
*I wrote this post because I think Southwest offers an amazing deal that I want to share with you and I would have written it even without any potential personal benefit. The bonus offer was 50K points when I wrote this post, and we’re definitely enjoying our companion pass! Chase/Southwest change the terms on occasion, though, so read the fine print before signing up. If you use links on this site to apply for Southwest cards, there’s a chance I’ll receive some bonus points too. Thanks for supporting this site!