Southwest has been sending out e-mails urging haste regarding a limited-time offer on the bonus when purchasing Rapid Reward points. When it comes to buying miles and points, there are many times that it can make a lot of sense due to the incredible redemption options across the different programs. However, in the case of Southwest’s Rapid Rewards, there is really never a good time to purchase points, even when there is a bonus offer.
The Southwest Bonus Offer
The current bonus offer on Southwest points is a 35% bonus on purchased points. You can buy up to 60,000 points and receive an additional 21,000 points as the bonus. To max it out, it would cost you $1,650. The bonus offer runs through October 13, 2014.
Why NOT To Take This Offer
Unlike most mileage programs, Southwest has a fixed value point system. That means no matter the award you redeem for, you will always get the same value out of it. This is because the points are tied to the cost of the ticket so there is no way to really maximize the Southwest program, other than the fact that you still get a lot of free travel from the points! 🙂
The reason this is not a good offer to take advantage of is because the final price on these miles, including the bonus, is at 2 cents per point. The official value of the Southwest points for redemption is at 1.43 cents per point (but it is a little higher because of the taxes, so more like 1.6 cents per point). That means that you will basically be paying .4 – .5 cents more for the points than you could get out of the redemption of those points. In short, you are spending more for the points than you would if you purchase the points outright! Not a good deal!
The only reason you would want to consider purchasing the Southwest points under this bonus offer is if you need a slight top up for an upcoming award. It would still be cheaper to use your Southwest credit card or Chase Sapphire Preferred/Ink cards to buy gift cards (and pay the load fee) than buying these points. But, if you have an award coming up soon or you are just shy the points required, the ease of buying the points make sense to just purchase at this price.
You need to look at the points you need to decide if that is a good enough deal. If you need to max out this promo for an award, then it is not a good offer to go for! That is a lot of money – $1,650 – and will only give you about $1,336 worth of travel. In other words, you will have overpaid by about $314 for these points. Some people may be thinking “yeah, but I have the companion pass!” Great – use the money to buy the tickets instead of purchasing points! You will be getting a better value doing that than purchasing points for award travel.
So, this is a very small unless since you should only take advantage of this offer if you are in need of the smallest amount of points to top up. Otherwise, just keep using your Chase cards to earn the points and forget about buying Southwest points. However, if you do need to take advantage of this bonus, here is the link to purchase these points (I do not receive a commission for this link).