Southwest releases these promos from time to time that are for purchasing points or giving additional points. Sometimes, the promo covers buying and gifting, sometimes it covers transferring, and sometimes it covers all three.
Over the last year, this bonus amount has been at 20%, 25%, 30%, and now we have a 35% promo (though previous offers were not all increase of points but some were reduction in cost). Not only that, but it covers buying points, gifting points (which is still buying points, just for someone else), and transferring points. A 35% bonus sounds like a good deal, but is it?
Southwest 35% Bonus
This bonus runs from now through April 22 and gives a 35% bonus on all points purchased, gifted, or transferred. For points that are purchased or gifted, the normal cost is 2.75 cents per point, which is terrible! The reason it is terrible is because you are only getting 1.6 cents per point worth of value when redeeming – which means you are paying 1.15 cents more than you could even hope to redeem!
The normal cost for transferring is 1 cent per point. With this transfer bonus, the new cost is 2 cents per point to buy and .7 cents per point to transfer.
The purchases for these points is run through points.com which means you will not receive any bonus for airline spend with these purchases. Here are the links for this bonus promo – transfer, buy, gift.
Points purchased or transferred through this promo do not count towards the Companion Pass or any status with Southwest – these are purely for reward redemptions. You can buy or transfer a maximum of 60,000 points in a single day.
Running the Numbers – Is It A Good Deal?
So, is it a good deal? With most airlines, it all depends on the type of value you plan on extracting from the points you are purchasing as to whether or not a promo bonus makes sense. With Southwest, it is more cut-and-dried – you are getting a max of 1.6 cents per point of redemption value. As such, unless you are trying to top off an account for some award redemption, buying points, even at this promo price, is not a good deal!
What About The Companion Pass?
You may be curious if having the Companion Pass would make a difference in balancing the value of this promo and it does not. The reason for that is that the Companion flies free whether you use points or pay for the fare. If the cost of the ticket is $200, it would require 12,500 points for both people to fly (not counting the segment tax of $5.60 per person/segment). So, it would be either $200 or 12,500 points for two people (with the Companion Pass). If you were to purchase the points, through this promo, to take advantage of the Companion Pass, it would cost you $250 to buy the necessary points – $50 more than purchasing the ticket outright!
The part that becomes a little murkier is when it comes to the transfer option. It normally costs 1 cent per point to transfer points from one account to another. With this promo, that cost is lowered to .7 cents per point. Transferring points will get you a savings of 1/2 price over the cost of purchasing the ticket. However, in most situations, you are better off just booking the ticket out of the original account.
But here are two ways that it could be a very good deal to transfer the points. The first one is if you want to transfer the points into an account that has the Companion Pass. By transferring those points into that account, it allows the account holder to book a ticket and then add a companion on to the ticket for free. In this scenario, it could be helpful to transfer points.
It could also help if you have points in an account that you would not be able to grow at this time (such as in the case of a minor where you cannot transfer Ultimate Reward points to them and they cannot get a credit card). If they have received some points from flying or a bonus, paying to transfer them into an account with more points could help offset the cost of future travel a bit.
In most situations, it will really not make a lot of sense to buy, gift, or transfer points – even with this promo. If you want to be a nice guy and gift travel to someone, use the current Amex promo and buy Southwest gift cards at Lowes for a 20% rebate or buy Southwest gift cards at Office Max/Staples with your Chase Ink card to receive 5X Ultimate Reward points. 🙂
If you want to top off an account or empty an account of a small amount, it could make sense to take advantage of one of these options.