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I’ll be very quick and to the point here.
Your Southwest Rapid Rewards points are worth about 6% less than yesterday.
Your average redemption yield will now be more like 1.2 – 1.4 cents per point vs. 1.3 – 1.5 cpp yesterday. It will still vary slightly by route / date.
This was done overnight and with no notice.
Generally, I’ve long advised that if you are redeeming Chase points and have a Sapphire Reserve card, you are better off using the portal for 1.5 cpp and also earning Rapid Rewards. But if you had a Sapphire Preferred card or an Ink Business Preferred, where you receive 1.25 cents per point in the travel portal vs 1.5cpp on the Reserve, transfers to Rapid Rewards still worked out better. Now, you may find that even on those cards, a portal beats using Rapid Rewards.
Now, I think it truly stinks for a program already tied to the price of a ticket with zero potential hugely outsized value redemptions to devalue. Since it’s already tied to the ticket price, they do not ever need to adjust. I have to assume they did this simply because this will result in a net ~6% gain on their booked liabilities for points. I.e. This looks good to the bean counters, but bad to us.
And just in case you needed another reason to not ever buy points, here you go…
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You can find credit cards that best match your spending habits and bonus categories at Your Best Credit Cards.
New to all of this? My “introduction to miles and points” book, MilesTalk: Live Your Wildest Travel Dreams Using Miles and Points is available on Amazon and at major booksellers.