Tag Archives: Rapid Rewards

Forum Buzz: American Airlines Buy Miles Bonus, Southwest to Puerto Rico

Posted on November 5, 2012 by | 2 Comments

American Airlines Escalating Bonus on Miles Purchases

According to this post on MilePoint, through November 15th American Airlines is offering up to 12,000 bonus miles when you purchase AAdvantage miles. The maximum number of miles you can purchase in a calendar year (and also through this promotion) is 40,000.

To purchase, follow this link and input your AAdvantage information.

As you can see from the terms and conditions page below, the highest bonus is earned when you purchase between 36,000-40,000 miles. You will receive 12,000 bonus miles.

The “sweet spot” of this promotion is purchasing exactly 36,000 miles. Buying this amount will net you a total of 48,000 AAdvantage miles for $1,099.25. You will be getting miles for 2.29 cents per mile. If you purchase the maximum 40,000 miles, you will still get 12,000 bonus miles but the cost per mile jumps to 2.34 cents.

Using the Mile Value Leaderboard, you can see that Scott values American miles at 1.77 cents. AAdvantage has solid online award availability (including partners British, Hawaiian, Qantas, airberlin, and Alaskan) and also allows free oneways on award travel. For more information, make sure to check out the full post, How Much is an AAdvantage Mile Worth? The Value of American Airlines Miles Part 2.

Obviously miles purchased through this promotion are more expensive than we value them. However, if you have a specific redemption in mind and this deal allows you to reach that milestone, then this promotion could make sense for some. I would not speculatively buy AAdvantage miles outright like I did for the recently concluded US Airways share miles promo. For more information on that, read Buy US Airways Miles for 1.1 Cents Through 100% Share Mile Bonus.

Southwest Announces Service to Puerto Rico, Hawaii Next?

According to this thread on FlyerTalk, Southwest has announced service to San Juan, Puerto Rico. Southwest will have three daily flights from Orlando (MCO) and one from Tampa Bay (TPA.) The airline is also holding a special $99 oneway promotion from to celebrate this new service. Details on that deal can be found on Southwest’s official page here.

Though AirTran, which recently announced it would be merging with Southwest, already services San Juan from several cities, the Orlando and Tampa routes will be exclusively handled by Southwest.

This is an important step for Southwest for several reasons. First, FlyerTalkers have confirmed that the Companion Pass does indeed work with this route. Earning 110,000 Rapid Rewards points in a calendar year gains you the coveted Companion Pass. With the pass, you can book any Southwest flight and have a designated friend or family member fly with you for nearly free. They must only pay the nominal September 11th security fees which are a maximum of $10.00 per roundtrip.

The Puerto Rico route greatly enhances the value of the Companion Pass and Rapid Rewards points as a whole.

Southwest’s expansion into Puerto Rico is also an important first step for eventual flights to Hawaii. I first discussed Southwest’s intentions to enter the Hawaiian market here and here. If Hawaii is next on Southwest’s route map, the value of the Companion Pass and Rapid Rewards points will grow even more.

Frequent Traveler University Tickets Now On Sale

As I mentioned in a post last week, Forum Buzz: Frequent Traveler University Dates Announced, the popular miles and points seminar Frequent Traveler University (or FTU) will be taking place April 26-28 in Tysons Corner, Virginia, a Washington DC suburb.

Registration for the event is now open and tickets can be purchased here.

This is an excellent event to meet up with fellow travelers and mile enthusiasts as well as hear presentations from your favorite bloggers. Scott will actually be speaking at the The FTU in Los Angeles from November 30-December 2 at the Sheraton LAX, which is now sold out. He will be covering free oneway awards on the major domestic carriers. For more information on his presentation, read MileValue to Speak at the Los Angeles Frequent Traveler University.

Recap

The American Airline bonus for purchasing miles is not worth it if you simply are trying to boost your AAdvantage account. The miles earned through this promotion are simply more than our valuation. Buying miles is less expensive than normal with the bonus, but not a suitable price for outright speculative purchases.

Southwest’s expansion into Puerto Rico is great news for Rapid Rewards members. These new routes are eligible for the Companion Pass, and this clears the way for more overwater destinations. Southwest could soon begin flights to Hawaii, creating an even better group of destinations for leisure travelers.

Frequent Traveler University tickets for the April 26-28, 2013 are now officially on sale. If you want to learn some great tricks and tips from experts and meet some like-minded travelers, this is the place to be.

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Posted in AAdvantage, Meet Up, Rapid Rewards

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Anatomy of an Award: How to Book an Award on Southwest

Posted on October 18, 2012 by | 8 Comments

The other day I helped a friend book a roundtrip Southwest award from Los Angeles to Denver for 11,761 Rapid Rewards and $5, taking advantage of a 1,000 Ultimate Rewards transfer to make up a shortfall of points in her account. For some people, this post will be very basic. But this post touches on some topics of interest to all, including the valuation of Southwest points–not 1.67 cents as commonly thought.

Most of my friends know that I am miles obsessed–perhaps because I wear MileValue tank tops and t-shirts to dodgeball pretty frequently. They generally combine jealousy of my trips with indifference or skepticism toward my methods. I only hear from them a few weeks before a trip: “How can I get a cheap ticket from XYZ to ABC in a few weeks?” I always suggest using kayak.com, and applying for a credit card now for their next trip.

So when my friend Allison said she wanted to go from LAX to Denver in a few weeks, and she had Southwest points, I was happy to help someone whom I could actually help. We signed into her account, and she had 11,659 Rapid Rewards. That’s about $200 worth of travel, so we searched for flights to see what we could do.

Rapid Rewards Primer

Southwest has a very different frequent flier program than the legacy carriers’ programs you may be more familiar with. Southwest has a revenue based program. Purchased Wanna Get Away fares earn 6 Rapid Rewards per dollar of base fare plus excise taxes. (10-12 if you buy a more expensive fare type.) Then you can use those points on any Wanna Get Away fare at a rate of 60 Rapid Rewards per dollar of base fare.

That means that the program basically amounts to a 10% credit on purchased fares, which can be used on future flights.

The 60 Rapid Rewards per dollar formula also means that you can score domestic awards for way fewer than 25,000 miles, the rate that the American legacy carriers charge. A $100 roundtrip from Los Angeles to Las Vegas would be fewer than 6,000 miles.

And I want to mention as many times as I can that Southwest domestic awards are temporarily capped at 19,200 points per roundtrip, subject to availability, because of a trick that exploits Southwest’s merger with AirTran. See How to Exploit the Southwest-AirTran Merger. This trick is useful when roundtrips are over $330 or so. It was not useful in Allison’s case.

How to Book a Southwest Award

Once signed into your account, perform a regular flight search on the home page, typing in your cities and dates.

On the results screen, you can toggle between seeing fares in dollars and seeing them in points.

If you’re happy with the prices or your dates are inflexible, you can choose the best flight for you. If you are flexible, click on the dates above the results for the fares on those dates. Or click Try our Low Fare Calendar to see a month-long view.

The total price of Allison’s preferred flights was 11,761 Rapid Rewards and $5. Allison only had 11,659 points, so she needed 102 more.

Southwest sells points directly for 2.5 cents per point with a minimum purchase of 2,000 points for $50.

This might be a decent deal if you need to top off for an award, and you have no other options. But in general 2.5 cents for a Rapid Reward is steep.

Luckily, there is a better option. Chase Ultimate Rewards transfer to Rapid Rewards instantly at a 1:1 rate. After clicking on your Ultimate Rewards balance after signing into your Chase account, select a transfer to Southwest.

Ultimate Rewards can be transferred instantly to your Rapid Rewards account in increments of 1,000.

The points transferred instantly, and we ticketed the award in a matter of moments.

For 11,761 points and $5, she had her flights to Denver booked. For comparison, the cash ticket on the same flights would have cost $217.60.

And here’s how that $217.60 breaks down:

Only $196 was the base fare plus the excise taxes. $5 was the 9/11 Security Fee. The rest was Segment Fees and Passenger Facility Charges. From taking a close look at Southwest award pricing in previous posts–see How Much is a Rapid Reward Worth?–I know that the award price is calculated as 60 times the base fare plus excise taxes. 11,761 points equals 196 times 60 (plus a phantom 1 that seems to be a part of all the awards I price on Southwest.com lately.)

Here’s where some confusion occurs. Rapid Rewards are often valued at 1.67 cents because 60 of them equals $1 of flying. But awards don’t include some fees and charges that cash tickets do include, and that valuation doesn’t take into account that paid flights don’t earn points.

For Allison’s flight 11,761 Rapid Rewards + $5 equaled a cash ticket that cost $217.60 and would have earned 1,176 Rapid Rewards. Typing those numbers into the fields of the MileValue Mile Value Calculator, we find that she earned 1.64 cents per point from her award. (Plug in 217.6, 5, 11761, 1176.)

Ticket Value ($)
Taxes and Fees ($)
Miles Used
Miles Foregone

In general, the way to get a higher CPM on Southwest flights is to book cheaper awards where the avoided Passenger Facility Charge and Segment Fees represent a higher proportion of the ticket cost or to use the merger-exploiting trick previously mentioned.

But Southwest points are very close to being fixed in value, so I recommend using them for domestic flights when Southwest has the cheapest fare, and you don’t need to earn status miles on a legacy carrier. Or when you need to check two bags each way, since those fly free on Southwest.

Recap

Booking an award on Southwest is very easy since all Wanna Get Away fares can be purchased as awards at a price of 60 times the base fare plus excise taxes. Awards are made even easier by the fact that you can top up a deficient Rapid Rewards account with instant transfers from an Ultimate Rewards account.

Southwest points aren’t completely fixed in value. You get a little more value out of awards on cheap fares and awards that are capped at 19,200 points than you do out of $200 to $300 fares.

If you have the chance, help a friend or family member book an easy award. It’s easy for you, but not for them. You can make someone’s day, and hopefully convert them to the miles religion. If more of your friends have miles balances like yours, you can have more companions on your next trip!

 

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Posted in Anatomy of an Award, Chase, How to, Rapid Rewards

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50% off Southwest Flights Today Only and Other Nuggets

Posted on August 3, 2012 by | Leave a comment

Thankfully Mommy Points has a full post on the 50% off Southwest sale happening today only. What a time saver she is for a blogger trying to enjoy his Aloha Friday. Check her post out for the full details, but don’t bother clicking if you can’t fly these seven Tuesdays and Wednesdays as the sale only applies to them:

  • September 5
  • September 11
  • September 18
  • September 25
  • October 2
  • October 31
  • November 6

 

The briefest miles blogger, Mile Nerd, lets us know about Dividend Miles Daily Deals. It’s like Groupon in that deals rotate and are discounted. It’s like a portal in that you get 5 US Airways miles per dollar on purchases. If you sign up through my link, we both get 500 miles after your first purchase. Feel free to put your referral link in the comments. I don’t see any deals that interest me at the moment, but I’ll be checking back.

 

 

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Anatomy of an Award: Southwest Airlines. Exploiting the Airtran-Southwest Merger

Posted on May 21, 2012 by | 15 Comments

This is the another post in my Anatomy of an Award series, in which I take a real award I’ve booked and break it down step-by-step to elucidate the award booking process. If you have a real award you’d like to write up in a similar post, please contact me, and you can write a guest post.

I am going to the Chicago Seminars for frequent fliers, being held October 12-14 at an O’Hare Airport hotel. Having some friends in Chicago, I wanted to arrive October 11 to go out in the city with them one night before the conference. Having been to Chicago once, I know that Midway Airport is connected to the city via the ‘L’ Train, so I wanted to fly into Midway to get to my friends in the city easily.

The only airline that flies direct flights to Midway from Los Angeles is Southwest. A few weeks back, I wrote a post that explained in detail how to exploit the Southwest-Airtran merger. The upshot is that the merger presents an arbitrage opportunity. Whereas before the number of points needed for a roundtrip Southwest award was uncapped and equaled 60 times the base fare, for a limited time the number of Southwest points needed for a roundtrip fare is capped at 19,200 points.

Why? Because you can currently transfer 1,200 Rapid Rewards (Southwest) points to 1 A+ (Airtran) credit, and 1 A+ credit to 1 Rapid Rewards credit. Since 1,200 RR points can become 1 RR credit, and 16 RR credits is enough for a free roundtrip or two free oneways, 19,200 RR points is enough for a free roundtrip. The only hitch is that awards that derive from 16 RR credits require you to find award space in much the same way that most airlines require a flight to have award space for you to book an award on the flight.

The question I faced was: Am I better off using my RR points to book the LAX-MDW oneway, or am I better off converting the points to credits? One wrinkle is that while 16 credits gets you two free oneways, 8 credits gets you nothing, so I’d have to prepurchase two free oneways with my points even though I only wanted one for this trip. (I wanted to return from O’Hare since the conference is there.) Luckily I have another oneway I want to take on a Southwest award from Tampa to Burbank next February, so getting two now is not a problem since they are good for one year.

Since half of the 19,200 points I’d need to convert into two free oneways is 9,600 points, I only wanted to convert points to credits if the LAX-MDW flight I wanted cost more than 9,600 points. I needed a mid-morning direct flight to Midway, and the price was over $200 in cash and 11,580 points, well above the 9,600 points it would cost if I converted to credits.

It was time to convert points and book a Southwest award. I’ve made a video of this, which you can see here, or you can continue reading with screen shots.

I signed into my Southwest account, and clicked My Account.

 

Once you’ve clicked on that, you have to click on the My Rapid Rewards tab.

Now click on transfer between A+ Rewards and Rapid Rewards.

At this point, you’ll have to sign into the A+ Rewards login box on the next page or sign up for the program.

Now that you’re signed into both accounts, you can transfer. You need 16 Rapid Rewards Credits to get anything. And that anything is two free oneways. Subtract the sum of any Rapid Rewards Credits and A+ credits you already have from 16. Now multiply how many short of 16 you are by 1,200. That’s how many points you need to transfer to A+ credits. Example: You have 2 RR credits and 3 A+ credits. You are 11 short of 16. 11 * 1,200 = 13,200, so you need to convert 13,200 points to 11 A+ credits. Below is the screen on which you convert the points to credits.

Once you’ve done that, you’ll come to a confirmation screen. Where it asks what you’d like to do next, click Transfer More Points, Credits, or Awards. Now you have to select to transfer your newly minted A+ credits to RR credits.

Once you have 16 RR credits, they disappear and are replaced by a Southwest award, which is two free oneways, which you do not have to book at once.

You can now call 800-I-FLY-SWA or book the awards online. Here’s how to do it online:

Click on the My Rapid Rewards tab again as shown in the second screen shot. Click on View My Old Credits and Awards as shown in the third screen shot.

Find the tiny link for View Awards:

If you have any awards there, you can click Book a Flight. After filling in your dates and airports, you are taken to a screen showing which itineraries are available for awards. In my experience, most flights from LAX are available as awards. See for yourself:

Almost all of the flights you could buy with cash or points are also available on an award. My preferred flight was too, so I selected it and booked it for $2.50.

Here is some info about the booking:

LAX-MDW cost: $204

My subjective value of the LAX-MDW: $204, would have paid cash if necessary

Rapid Rewards points price: 11,580

Rapid Rewards points used to get 1/2 an award: 9,600

RR points saved by converting to credits to an award: 1,980 (worth $33.46)

Total taxes and fees: $2.50

Points foregone by not purchasing itinerary: 1,158

Cents per mile as booked: 1.87! according to the milevalue calculator. (I plugged 204; 2.5; 9600; 1158 into the calculator. Do you see why?)

I’m pretty excited, since many people think that Southwest operates a fixed-value program with points worth 1.67 cents. While you can transfer points to credits, 1.67 cents is a minimum value for points, not a fixed value!

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Posted in Anatomy of an Award, Rapid Rewards, Video

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One Day Sales: JetBlue and Southwest

Posted on May 15, 2012 by | 2 Comments

JetBlue, my favorite coach cabin in the world, and Southwest are both having one day sales that end today, May 15, at 11:59 PM ET.

First the JetBlue sale: Here’s a complete list of the city pairs with fares on sale. If you want to fly one of those routes between May 22 and June 21, the deals are generally pretty good. Click on a city pair for black out dates and day-of-the-week restrictions. This sale is valid on oneways and roundtrips.

If you see a city pair you like, simply go through the normal booking process at jetblue.com, the sale fares will be included in the search results. Here’s a really good deal I found:

It’s common to find a deal like $80 roundtrip from LAX to Las Vegas, but from Burbank that’s unheard of. Usually a roundtrip from BUR to Las Vegas is at least $160.

Southwest is also running a one-day sale today, but of a very different kind. The Southwest sale is available on only seven upcoming dates:

  • May 22
  • May 30-31
  • June 5-6
  • July 4-5

On those dates, any oneway or roundtrip Wanna Get Away fare is 35% off. (The offer excludes about a dozen routes, see the full T&C here.) So if you can travel on those dates this is a fantastic deal. It’s an especially fantastic deal because of Southwest’s refund policy and Rapid Rewards program.

Southwest lets you cancel a cash reservation and be credited back a credit for use on future Southwest flights in the amount of your ticket price. Southwest lets you cancel a points reservation by refunding the taxes and fees and redepositing the points. Neither type of cancellation incurs any fees.

That means if you already have travel planned on Southwest for one of the promo days, you can cancel that leg, and rebook at the new lower price! The cancellation policy and promos like this are the reason I advise that if you know you want to fly a Southwest flight in the future with cash or points, book it immediately. If prices then rise, you locked in the best deal. If prices fall, you can cancel and rebook penalty free.

This is also a fantastic deal for those of us with a stash of Rapid Rewards points. Why? Rapid Rewards are a fixed value program, so when dollar fares fall, the number of points needed to book falls!

How do you book with this promotion? It is not as straight forward as JetBlue’s promotion. Once you’ve selected flights on a 35% off day, you need to type in the promo code SUMMER12 at the checkout screen.

I would love to do a dummy booking as an example, and so I could add screen shots. But southwest.com’s booking engine has been down for over an hour.

Two different promos, two different deals, either could save you $100 or more if they match your travel needs.

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How to Exploit the Southwest-Airtran Merger

Posted on April 22, 2012 by | 42 Comments

Update 6/8/13: This trick is still active!

Southwest Airlines and Airtran Airways are merging. This week the airlines announced that for the time being, transfers will be allowed between Southwest’s Rapid Rewards loyalty program and Airtran’s A+ loyalty program.

This presents an arbitrage opportunity similar to the one I detailed last week, which involved converting Rapid Rewards points to Rapid Rewards credits to save a bundle when booking expensive Southwest flights.

First let’s look at the the mechanics of the now allowable conversions between Rapid Rewards and A+:

1,200 Rapid Rewards points converts to 1 A+ credit

1 Rapid Rewards credit to 1 A+ credit

1 Southwest Standard Award (two oneways) to 16 A+ credits

1 A+ credit converts to 1 Rapid Rewards credit

16 A+ credits can be used to fly two oneways on Airtran, and 16 Rapid Rewards credits can be used to fly two oneways on Southwest.

So what does all this mean, and how can we exploit it. Because there are unlimited transfers between the programs, it means that we can use 19,200 (1,200 * 16) Rapid Rewards points for two free oneway trips on either airline.

19,200 Rapid Rewards points are worth $324, so if you can find two oneways on either airline that cost more than that, you can profit from transferring.

In today’s environment of sky high fares, finding a roundtrip or two oneways that cost more than that is pretty easy, especially since Airtran flies internationally to Mexico and the Caribbean.

Let’s go through some examples to show how to determine whether you can exploit the transfer options.

LAX-MDW-LAX for the dates I want costs $408, and I value it at that price because I need to get to Chicago, and there are no cheaper options. In Rapid Rewards points it costs 23,160 and $5. This is a prime example of a fare where exploiting the transfer options saves money!

Instead of paying cash or 23,160 points, I can transfer 19,200 Rapid Rewards points to A+ credits. The transfer is instantaneous. I can then immediately transfer 16 A+ credits to 16 Rapid Rewards credits. After that instantaneous transfer, I now have two free oneways on Southwest that I can use to fly LAX-MDW-LAX for just the same $5 in taxes.

So I got an itinerary for 19,200 Rapid Rewards points that should have cost me 23,160 Rapid Rewards points. Exploiting the transfers saved 3,960 Rapid Rewards points with a value of $63.54! Awesome!

Here’s an easy example of when not to transfer. I want to fly LAX-LAS-LAX, and the flights I want cost $114 or 5,520 Rapid  Rewards points and $5. Transferring 19,200 Rapid Rewards points to 16 A+ Credits to 16 Rapid Rewards credits would be folly. Instead I would just book with 5,520 points and $5.

Now that you know when to transfer, here’s how to transfer. It’s incredibly easy.

  • Log in to your Southwest account on the right side of southwest.com
  • Click on the My Account link that appears where you typed your password.
  • Click on the My Rapid Rewards tab.
  • Choose the Transfer Between A+ Rewards and Rapid Rewards button on the left side of the page.
  • Type in your Airtran account information, then follow the instructions to transfer Rapid Rewards points to A+ Credits (then A+ credits to Rapid Rewards credits if you are booking with Southwest)

This transfer option makes Southwest’s program temporarily much more lucrative. For short cheap flights, the normal points price will remain incredibly low, sometimes just a few thousand points for a roundtrip. For longer, more expensive flights, though, a roundtrip is effectively capped at 19,200 points, so we get the best of both worlds: points-cheap short trips and points-cheap long trips.

I hope everyone seriously looks into these transfers for their ability to use up orphaned Rapid Rewards credits, use up orphaned A+ credits, and save a bundle on expensive Airtran and Southwest flights.

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Up to 30% Rebate: Triple Points at Five Retailers in Rapid Rewards Mall Unitl Saturday

Posted on March 29, 2012 by | Leave a comment

All deals in this post have expired.

Southwest is having a three-day deal giving triple points on purchases at five retailers. The deal expires 3/31/2012.To access the deal, simply go to rapidrewardsshopping.southwest.com. The deal is open to all without any special codes, just search for the applicable retailer, and click the Shop Now button.

What’s the deal worth? I’ll be basing this on my analysis of the value of a Southwest Rapid Rewards point. Since it’s a fixed-value program, your value should be the same. The points listed below are in addition to any you earn for a normal purchase, so if you’re using the Southwest credit card, add another one point per dollar to every deal.

  1. ebags.com: 6 18 points per dollar. Purchasing through the Southwest portal earns a 30.4% rebate. If you’re planning on buying some luggage, this could be an incredible deal. Normal best deal: 9 Ultimate Rewards points per dollar through Chase’s online portal.
  2. Tory Burch: 3 9 points per dollar. Purchasing through the Southwest portal earns a 15.2% rebate. I’ve never heard of this brand, but a 15% rebate on “an attainable, luxury, lifestyle brand defined by classic American sportswear with an eclectic sensibility” must be a good deal for someone. Normal best deal: 3 Membership Rewards points per dollar through Amex’s online portal.
  3. Target: 2 6 points per dollar. Purchasing through the Southwest portal earns a 10.1% rebate. This is a great deal at an already inexpensive, low-margin retailer. Normal best deal: 3 Membership Rewards points per dollar through Amex’s online portal.
  4. Macy’s: 2 6 points per dollar. Purchasing through the Southwest portal earns a 10.1% rebate. If you had something in mind at Macy’s, enjoy this 10% rebate.  Normal best deal: 5 Ultimate Rewards points per dollar through Chase’s online portal.
  5. Barnes & Noble: 1 3 points per dollar. Purchasing through the Southwest portal earns a 5.1% rebate. This is a bad deal. Chase’s online portal lets you earn 10 Ultimate Rewards per dollar on B&N purchases every day. And Ultimate Rewards can be transferred to Southwest at a 1:1 ratio among other transfer opportunities. If you want to shop at B&N, do it through Chase.

Things to keep in mind: you don’t get the bonus points on gift card purchases or shipping. And most importantly, this is really only a good deal if you were planning to purchase what you purchased anyway. If you were willing to pay the full retail price, a 30.4% rebate is pretty sweet. But if this deal gets you to buy things you wouldn’t have otherwise bought, you may actually come out behind.

 

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How Much Are Rapid Rewards Points Worth? The Value of Southwest Airlines Points

Posted on March 26, 2012 by | 13 Comments

Southwest Airlines Rapid Rewards points are worth 1.69 cents per point. Unlike my calculation of the value of an Avios, the valuation of a Rapid Rewards point does not change based on where you live or your flying preferences because Rapid Rewards is a fixed-value award program. That means the number of points needed for an award is directly dictated by the price of the fare, and the number of points earned for flying a paid fare is directly dictated by the price of the fare also. The distance of flights and the regions in which the origin and arrival city are located are irrelevant to calculating Rapid Rewards points needed or earned.

Let’s go through the rules and parameters of the Rapid Rewards program, consider the strategy for maximizing the value of your Rapid Rewards points, and calculate the value of one Rapid Rewards point.

Important rules:

  1. Every award in the Wanna Get Away fare class costs 60 points per dollar of the base fare including excise tax. Other fare classes are available for awards for more points per dollar, but since Southwest’s flights are all operated with all-coach planes, there is no reason to book any awards except Wanna Get Away fares.
  2. All Southwest flights have open seating. Your boarding pass tells you the order in which to board, but not your seat. You can board earlier if you pay $10 extra when purchasing your ticket or if you purchase a more expensive fare class. Or you can check in online 24 hours before the flight and get priority over those who check in later.
  3. The only fee on Southwest award tickets is $2.50 per segment for the 9/11 security fee. There are no ticketing fees, no change fees, and no redeposit fees if you decide to change or cancel your ticket. Pleasantly, the Passenger Facility Charge and Segment Fee that are added to the base fare when purchasing with cash are not charged when booking an award ticket. (Nor are they included in the fare on which the 60 points per dollar award price is calculated.)
  4. Award availability is the exact same as cash availability. If a flight can be booked with cash, it can be booked with points. The only note is that Wanna Get Away availability disappears several days before departure.

Strategy to Maximize the Value of Southwest Rapid Rewards Points:

  1. If you cancel an award, the points are redeposited immediately, and any charges to your credit card for 9/11 security fees are reversed. Therefore if you know you want to book an award with Southwest, book it right now. If the price rises, you locked in the best fare and maximized the value of your points. If the price falls, you can cancel your original reservation and rebook at the lower price. If you don’t want to constantly be checking fares, then at least monitor Southwest’s amazing sales, which seem to pop up every few months and are announced by email, which you can signup for here.
  2. Book an award on Southwest when you’re flying with lots of bags. Southwest is the only airline that still lets you check two bags free each way. That will save you $120 roundtrip versus most legacy carriers.
  3. Book a direct route that only Southwest serves. Eschewing the hub-and-spoke model of most carriers, Southwest has a ton of direct point-to-point flights that have no competition. If you value your time, flying direct on Southwest is much more valuable than flying a route with a connection on another airline.

Examples of Southwest Awards:

1) LAX-PIT oneway connecting in LAS

  • Lesser of Price and Value: $221.60
  • Award Taxes and Fees: $5
  • Rapid Rewards Points Needed to Book: 12,000
  • Rapid Rewards Points Foregone by Not Purchasing with Cash: 1,200

2) LAX-PHX oneway direct

  • Lesser of Price and Value: $69.80
  • Award Taxes and Fees: $2.50
  • Rapid Rewards Points Needed to Book: 3,540
  • Rapid Rewards Points Foregone by Not Purchasing with Cash: 354

I think these are both pretty good cash fares, so I used price for “Lesser of Price and Value” in both cases. Plugging these values into the milevalue.com Mile Value Calculator nets values of 1.64 cents per Rapid Rewards point to Pittsburgh and 1.73 cents per point to Phoenix. For other awards, I got values between 1.57 and 1.75 cents per point. Why does this fixed-value program not have a fixed value per point? It’s that quirk I mentioned above of not charging award passengers the Passenger Facility Charge and Segment Fee and also not charging award passengers points equal to the dollar amount of those fees. What it means is that you’ll get a slightly higher cents per point booking cheaper flights.  I’ll take the middle end of the range and value Rapid Rewards points at 1.66 cents per point for now. The final step in the valuation is to compare Southwest awards to flights purchased with cash in order to come to a final valuation.

Southwest Awards Compared to Buying with Cash:

Buying an award with Rapid Rewards points on Southwest is exactly the same as buying a flight with cash except for two things. The first is that awards don’t have the Passenger Facility Charge or Segment Fee. I mentioned that above, and that’s already been factored into the valuation, so I’ll ignore it here, so we don’t double count it. The second difference is that if you pay with cash then cancel, you don’t get cash back. You get Southwest credit for a future flight. Obviously cash is slightly more valuable. If you cancel an award redemption, you get back the exact points you put in, so you’re in exactly the same position as before the redemption. Advantage award redemption. The difference is slight, but I will increase my valuation from 1.66 to 1.69 cents per Rapid Rewards point because of it.

Southwest Airlines has a very different frequent flier program than the legacy carriers, so exploiting it requires a different approach. As we’ve seen the key is to find good deals in cash and book those flights with points. Southwest’s policy of allowing award redeposits free of charge makes that easier, so everyone should be able to wring 1.69 cents out of every Rapid Rewards point.

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