cancel
Showing results for 
Search instead for 
Did you mean: 

Salvaging Value from Chase/SWA Travel Credit

tag
Curious_George2
Valued Contributor

Salvaging Value from Chase/SWA Travel Credit

Those of us who have the Chase Southwest Rapid Rewards Priority card are entitled to receive a $75 annual credit against Southwest purchases. If you find yourself in the position of potentially missing out on claiming that credit because of COVID or otherwise, you might be interested in an opportunity I found. It's not super lucrative, but it's arguably better than nothing.

 

Southwest is giving bonus points with the purchase of Rapid Rewards points. They seem to do this fairly often. Last month they had a 75% bonus. The current deal, good through Nov. 20, gives a 60% bonus for purchases of 3,000 miles or more. For $90 you get 4,800 miles (3,000 base + 1,800 bonus). There are larger bonuses for larger purchases, but that's not relevant here. Obviously you have to use your Chase SWA card to purchase the points in order for the rest of this to work.

 

Chase will apply the $75 annual credit to a purchase of points. I couldn't find anything in the Terms and Conditions or on the internet confirming that this would work, so I tested it myself. It works!

 

 

This wasn't a sure thing because RR points purchases are processed by a third party vendor named Points. So TPG and others always hedge a bit when writing about this topic because they aren't sure whether Chase treats a charge from Points as a Southwest purchase. Happily, they do. So far I have paid a net $15 for 4,800 points, but we're not done yet.

 

I'm getting another 180 points because, as above, Chase counts this as a Southwest purchase, which earns 2x points.

 

 

Now I'm at $15 for 4,980 points. That's a cost of 0.3 cpp for points that are generally valued between 1.28 cpp and 1.5 cpp. Pretty good! Looking forward, if my luck holds, I may even squeeze a bit more value out of it by stacking some Southwest Promotions.

 

On my Southwest account, I have two Promotions that are relevant here: One is advertised as 5x points on Southwest purchases with a co-branded Chase card. The other is a 30% bonus on points posted from the Chase card to Southwest in certain months. These may be targeted Promotions, and they aren't heavily advertised, so check your own Southwest account.  The current version of the 30% bonus has a hefty spend requirement and contributes very little to this exercise, so most people won't bother with that one.

 

The so-called 5x promotion is actually just an extra 3x points that Southwest chips in on top of the normal 2x points that this card earns on Southwest purchases. In my example, that should be another 270 points. I won't know until my statement cuts, but I'm optimistic and I will update.

 

The T&C for the 30% bonus say it will only apply to the 180 points that come from the card (not the 270 that Southwest adds), so that should give me another 54 points. I won't know until after the bonus period, which is the end of this month.

 

If all of that works, I will get 5,304 points for an out-of-pocket cost of $15. That's a cost of 0.28 cpp. In any event, I'll get about $70 worth of points for $15 cash plus an otherwise unusable $75 credit. Maybe I was a fool to give an airline more of my money when I'm not flying and their industry is financially distressed. The phrase "sunk cost fallacy" keeps crossing my mind as I type this. And sure, there's always the risk of point devaluation. But I'm not focusing on that. I am happy to get some value out of my travel credit and pleased/optimistic about the credit and bonuses stacking.

Message 1 of 4
3 REPLIES 3
blindambition
Senior Contributor

Re: Salvaging Value from Chase/SWA Travel Credit

That's good info!!! Thanks for sharing with the community!!

I'm glad it worked out. Since volunteering to be the test participant doesn't always produce best result... so kudos!!!

Smiley Very Happy

Message 2 of 4
Curious_George2
Valued Contributor

Re: Salvaging Value from Chase/SWA Travel Credit

You're right about that. I half expected it not to work, so the success so far feels like a win.

 

What I was not expecting was for the NY Times to publish a piece the very next day, the title of which calls me a loser: Airline Miles Programs Sure Are Profitable. Are You the Loser? (possible paywall).

Message 3 of 4
Curious_George2
Valued Contributor

Re: Salvaging Value from Chase/SWA Travel Credit


@Curious_George2 wrote:

Those of us who have the Chase Southwest Rapid Rewards Priority card are entitled to receive a $75 annual credit against Southwest purchases. If you find yourself in the position of potentially missing out on claiming that credit because of COVID or otherwise, you might be interested in an opportunity I found. It's not super lucrative, but it's arguably better than nothing.

 

Southwest is giving bonus points with the purchase of Rapid Rewards points. They seem to do this fairly often. Last month they had a 75% bonus. The current deal, good through Nov. 20, gives a 60% bonus for purchases of 3,000 miles or more. For $90 you get 4,800 miles (3,000 base + 1,800 bonus). There are larger bonuses for larger purchases, but that's not relevant here. Obviously you have to use your Chase SWA card to purchase the points in order for the rest of this to work.

 

Chase will apply the $75 annual credit to a purchase of points. I couldn't find anything in the Terms and Conditions or on the internet confirming that this would work, so I tested it myself. It works!

 

 

This wasn't a sure thing because RR points purchases are processed by a third party vendor named Points. So TPG and others always hedge a bit when writing about this topic because they aren't sure whether Chase treats a charge from Points as a Southwest purchase. Happily, they do. So far I have paid a net $15 for 4,800 points, but we're not done yet.

 

I'm getting another 180 points because, as above, Chase counts this as a Southwest purchase, which earns 2x points.

 

 

Now I'm at $15 for 4,980 points. That's a cost of 0.3 cpp for points that are generally valued between 1.28 cpp and 1.5 cpp. Pretty good! Looking forward, if my luck holds, I may even squeeze a bit more value out of it by stacking some Southwest Promotions.

 

On my Southwest account, I have two Promotions that are relevant here: One is advertised as 5x points on Southwest purchases with a co-branded Chase card. The other is a 30% bonus on points posted from the Chase card to Southwest in certain months. These may be targeted Promotions, and they aren't heavily advertised, so check your own Southwest account.  The current version of the 30% bonus has a hefty spend requirement and contributes very little to this exercise, so most people won't bother with that one.

 

The so-called 5x promotion is actually just an extra 3x points that Southwest chips in on top of the normal 2x points that this card earns on Southwest purchases. In my example, that should be another 270 points. I won't know until my statement cuts, but I'm optimistic and I will update.

 

The T&C for the 30% bonus say it will only apply to the 180 points that come from the card (not the 270 that Southwest adds), so that should give me another 54 points. I won't know until after the bonus period, which is the end of this month.

 

If all of that works, I will get 5,304 points for an out-of-pocket cost of $15. That's a cost of 0.28 cpp. In any event, I'll get about $70 worth of points for $15 cash plus an otherwise unusable $75 credit. Maybe I was a fool to give an airline more of my money when I'm not flying and their industry is financially distressed. The phrase "sunk cost fallacy" keeps crossing my mind as I type this. And sure, there's always the risk of point devaluation. But I'm not focusing on that. I am happy to get some value out of my travel credit and pleased/optimistic about the credit and bonuses stacking.


Update: It took a lot longer than I expected, but I am happy to report all of this worked out for the best. Chase and Southwest and Points coordinated sufficiently well that I got every bonus point I was hoping for.

 

The 5x (really just an extra 3x) bonus period ran through March, and the points just posted to my Rapid Rewards account last week. So that's 8 weeks after the end of the bonus period.  

 

The 30% bonus period ran through October and those points posted on November 17. 

 

My only complaint is, while I was waiting for the last 270 points to show up (5% of the total points I got), Southwest devalued Rapid Rewards points by 6%.  Five steps forward, six steps back. 

Message 4 of 4
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.