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Southwest Increases Points Redemptions by 15%

Southwest Increases Points Redemptions by 15%

Million Mile SecretsSouthwest Increases Points Redemptions by 15%Million Mile Secrets Team

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The bad news is that you need 15% more Southwest points to redeem a Wanna Get Away ticket (Southwest’s lowest price tickets).

The somewhat good news is that the 15% increase doesn’t start until March 31, 2014.  So try to book all your Southwest flights using points BEFORE March 31, 2014.

Southwest Increases Points Redemptions by 15%
15% Increase in Southwest Wanna Get Away Fares from March 31, 2014

In my opinion, Southwest is the best frequent flyer program for travel within the US.  That’s because Southwest has lots of non-stop flights from different airports, lets you check-in 2 free bags, and has a friendly crew.  They also let you cancel or change flights for free without change fees which can be up to $200 on other airlines!

And whenever an airline or hotel provides much more value than their competitors, I know from personal experience that the pressure is on company executives to justify that the outsized benefits helps the bottom line.  So it is very common to see airline and hotel miles and points devalue.

Or to have airlines and hotels make changes to their programs which increase their profitability, but reduce benefits to members.

I certainly don’t like it, but that’s the nature of the points and miles hobby.  Companies continually look for ways to cut costs and reduce benefits when they don’t need to provide it or are providing way more benefits than the competition.

Currently a Wanna Get Away award ticket will cost 60 Southwest points per $1.  So each Southwest point is worth ~1.67 cents (100 cents / 60 Southwest points) towards an award ticket

But from March 31, 2014, a Wanna Get Away award ticket will cost 70 Southwest points per $1.  Which makes 1 Southwest point worth ~1.42 cents (100 cents / 70 Southwest points) or a 15% reduction.

What Does This Mean?

A $344 ticket from Kansas City to San Francisco in April 2014 currently costs 18,000 points.

Southwest Increases Points Redemptions by 15%
18,000 Points To Fly From Kansas City To San Francisco If Booked Before March 31, 2014, but 21,000 Points After That!

But that same $344 ticket would cost ~21,000 points (instead of 18,000 points) if I booked it after March 31, 2014!

Southwest’s schedule is only loaded through April 6, 2014, but you can book award tickets at the current rate of 1 Southwest points = 1.67 cents towards Wanna Get Away fares even for travel after March 31, 2014.

You can book your trip using points even if your plans are tentative, because you can get the points back without paying a change fee if you have to cancel your flight.  So wait until the schedule opens out for beyond April 6, 2014 and lock in your awards at the higher redemption level.

Southwest is not making any changes to Anytime or Business Select award tickets (at least not now).

Companion Pass

I’ve written lots on the Southwest Companion Pass and think it is the best deal for our domestic US travel.  Why?  

Because it lets a companion travel with you for free whenever you travel on Southwest.  It doesn’t matter if your flight is booked with points or paid for with cash – your companion flies free (~$10 in taxes and fees)!

The Southwest credit cards have a 50,000 point sign-up bonus after spending $2,000 within 3 months up to October 31, 2013 and the sign-up bonus currently counts towards the Southwest Companion Pass.

At 1.67 cents per Southwest point, you’d get ~$850 in flights on Southwest.  But you’d get only ~$710 worth of flights at 1.42 cents per point.

But $710 in flights within the US from just 1 credit card is still very good!

Bottom Line

From March 31, 2014, Southwest will increase the cost of redeeming Wanna Get Away fares from 60 Southwest points per $1 to 70 Southwest points per $1.  This  reduces the value of 1 Southwest point from 1.67 cents to 1.42 cents.

So wait for the schedule to open beyond April 6, 2014 & book your flights on Southwest before March 31, 2014 to get the most out of your points!

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Editorial Note: We're the Million Mile Secrets team. And we're proud of our content, opinions and analysis, and of our reader's comments. These haven’t been reviewed, approved or endorsed by any of the airlines, hotels, or credit card issuers which we often write about. And that’s just how we like it! :)

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I have a question….. what happens with booking a fare at the current rates, then rebooking later? In the past this has always been a bonus of SWA points travel, you can rebook with ease if your dates change,or the price drops…..now what? any advice?Say I book a flight for next Sept.,and then I have to alter my date a bit in 3 months….. will I be charged the higher price to rebook? or will it rebook at the current rate?

Author
Million Mile Secrets

@JM – I believe you will be charged the higher price.

I wonder if ahead of the change in exchange value, it would make sense to change my Southwest Points into Airtran miles/flights? For 1200 rapid rewards points + 1 A+ Airtran credit. Would be curious if anyone had thoughts on that.

I never had a single point in my RapidRewards account. The day I get the sign-up bonus from Chase the devaluation is announced. Can this be coincidence? 🙂

All of you arguing about the percentage change in value are wrong. You’re forgetting the opportunity cost involved in booking a ticket with points – you will no longer earn points for that ticket. So assuming you buy WGA fares, the true cost before the change was 66 points per $1 (the 60 points you spent and the 6 you gave up by not buying the ticket with dollars) making the previous value 1.5151 cents. Now the true cost is 76 points per $1 which works out to 1.3158 cents per point. The value is even lower if you consider the progress towards A-List or Companion Pass from flying on a revenue ticket. Of course none of this takes into account the fact that the point cost is based on the base fare and all the taxes and fees other than the 9/11 security fee are waived if you book an award ticket. That increases the value of points a little bit, but it’s impossible to value that part precisely since it depends on the value of the ticket you buy. You get the best value using your points for cheaper tickets as the waived taxes/fees are a higher percentage of the overall value. The opportunity cost isn’t affected by this since point earning is also based on the base fare and doesn’t take into account taxes/fees.

Opinions cannot be wrong.

I tend to agree with Daraius. The FF miles with SW are abundant with all of the signup offers we get for card churning.

The availability on flights is also superior to anything United or “Denver’s Airline” Frontier offer. Hunting for FF seats is legitimately annoying, really a hassle to find seats for flights, and two are nearly impossible to book. You have to watch constantly for those seats.

I do have a question, Daraius, you said hotels and car rentals are 2X with the SW card, but I thought the 2X was only through Southwest’s site? Are you saying any hotels earn 2X with the SW card, or only if booked through Southwest? I have yet to find a great deal on anything through Southwest for hotel or car rentals.

We did get the Ink Bold when you had the 60K mile bonus link on your site. I have noticed our hotel stays, even our Marriott Vacation Club and other timeshare maintenance fees are earning 2X with that card, which is amazing! We also spend around $500 per month on cell phone, business phone, satellite TV and internet. We really love the 5X points for those.

Thank you for all of your helpful advice.

Cindy

Author
Million Mile Secrets

@Cindy and Rick – It is 2X for car and hotels booked via Southwest and not directly. Where did you see the reference to 2X on car/hotels? I’ll edit it to be clearer. I pay the fee on the Ink card because off all the points I earn.

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