Contents
Introduction
When the Chase Southwest bonus for personal cards changed to 30,000 points & a companion pass for 2019 I called the offer quite weak and a masterstroke of marketing. Nick over at Frequent Miler disagreed with me and Greg even chimed in with a FM vs DoC post. I thought a post explaining my reasoning in more detail probably makes more sense. (Quick note here, I think Nick & Greg had a fair look at the card and offer. I’m specifically talking about them/their site because I think it was the most balanced. Some other sites called this the greatest travel deal of all time and I think everybody can agree that’s ridiculous).
The Basics
For this post I’m making a few assumptions:
- You know what a companion pass is and why it’s valuable. This pass normally requires earning 110,000 points within a calendar year and lets a companion fly with you for free (aside from $5.6 in fees). Normally when you earn it it’s valid for the remaining calendar year and then the following calendar year. With this offer you get the companion pass for the remainder of 2019 just for meeting the minimum spend requirement.
- You know that Southwest points are worth roughly 1.28¢ each.
- Card restrictions. Two restrictions apply to getting this card:
- The product is not available to either (i) current Cardmembers of any Southwest Rapid Rewards® Credit Card, or (ii) previous Cardmembers of any Southwest Rapid Rewards Credit Card who received a new Cardmember bonus within the last 24 months. This does not apply to Cardmembers of the Southwest Rapid Rewards Business Card and Employee Credit Card products.
- Chase 5/24 rule applies
Why The New Offer Is Weak
Getting a companion pass is obviously useful, but you’ll only have 30,000 points (roughly $384 in Southwest flights) to use with that companion pass. Most people would agree that transferring Chase UR points to Southwest isn’t a good use of points, you can obviously still use cash to pay for flights and get good value there but this hobby is about reducing those cash costs as much as possible. In addition
The main reason why I called this new offer weak is because you need to compare it to other offers that are available or have been available recently. Remember that by getting the personal card you will be ineligible to get another Southwest personal bonus for 24 months. Instead of going for this offer you could do the classic double dip and get one personal card and one business card and get enough points for a companion pass.
- You can currently get 50,000 points after $2,000 in spend on the Southwest personal cards.
- You can also still get 60,000 points after $3,000 in spend on the Southwest business card.
The nice thing about the business card is that it doesn’t count towards your 5/24 status (although the 5/24 rule does still apply to it). If you applied for both of those cards you’d end up with a total of 110,000 Southwest points and get the companion pass for the rest of 2019 and all of 2020. Now let’s compare the two options:
- Option one (Southwest 2019 companion pass): 30,000 points (worth $384 in Southwest flights) and companion pass through 2019.
- Option two (Double dip method): 110,000 points (worth $1,408 in Southwest flights) and companion pass through 2020
By applying for the second card you’re essentially getting an additional 80,000 Southwest points and the companion pass for a second year. The total spend requirement is $5,000 for the double dip method and $3,000 for the 2019 pass method.
Why The New Offer Isn’t Weak
There are a number of reasons why the new offer isn’t weak and they mostly pertain to the difficulty in doing the double dip.
- Not everybody is eligible for a Chase business card. This is true, it’s not extremely difficult to get approved for a Chase business card and a lot of people might have businesses that they don’t really realize (e.g a ‘side hustle’).
- Not everybody feels comfortable using those in flight links. So far nobody has had any issue using those 50,000 in flight links.
Our Verdict
Personally I’d rather apply for two cards and get 110,000 points and a companion pass for two years than apply for one card and get 30,000 points and a companion pass for one year. If you can’t/don’t want to do the double dip method and can make good use from a companion pass then there is nothing wrong with applying, but I don’t think it’s a particularly compelling offer when you peel back the layers.
Does the CP still take 8weeks to get when you get it the original 110k points way?
Does referral link show this same offer of 30K points and companion pass? Any info on that?
I’m not sure what I think the best strategy is, but … to further your point, I think the min. spend for the 2019 single-year companion pass is $4,000 (not $3,000), as you mentioned above.
Also – I’ve seen some references to the possibility of getting the 2019 single-year companion pass with a single personal card now, and then still being able to get the business card w/60,000 bonus points before the end of this year, and, combining that with the 30,000 from the personal card (and some other spending during the year) qualifying for the usual 2-year companion pass, good through the end of 2020… Does anyone know if this will work? i.e., whether SW will allow a person to get the single-year pass via the 30,000 point offer now, and then still allow the person to get the usual companion pass by getting to 110,000 points before the end of the year…??? Thanks!
“Most people would agree that transferring Chase UR points to Southwest isn’t a good use of points”
Not in normal circumstances, maybe, but when you have the CP then you can use those points for 2, so surely it’s a good use of points when you have the CP?
Keep in mind if you pay cash the effective value is also doubled. It only really matters if you’d normally transfer to a different airline partner.
Smart marketing to tell the average consumer you’re going to get BOGO flights. Logic and math doesn’t apply to “savings”. It is all about mental, feel-good, pieces.
When in reality, there’s lots of reasons why this isn’t that good for the average person. Especially when you limit yourself to one airline that can be expensive, not have your route, or have poor route choices.
Doc, I think you are a bit too optimistic about the ease of getting a Chase business card. I have gotten two and my wife has gotten one, and we had to jump through quite a few hoops to get them (not having a huge primary business but a couple of minor side hustles). We both were denied the cards initially and had to call reconsideration line and provide quite a bit of info about our businesses, including net revenue for the last three years, etc. They told my wife at one points that her side hustle was simply not making enough money (20K/year) for them to approve her for a business card. She had to play her “but I’m a loyal Chase customer and would really hate to go to a different bank for a business credit card” (all true, BTW). Our last two approvals for the business cards were by the skin of our teeth, and I have a strong feeling that they wouldn’t approve our side hustle business card again.
Now, for people with decent size businesses that are their primary source of income, the two-card option is a no-brainer. But I personally would have to think really hard about it.
Also, a bit orthogonal, but there is one more thing that makes Rapid Reward points very valuable. Since Southwest doesn’t charge for flight changes or cancellatoins, it’s a much much better play to use points instead of cash for flights. Then you can book your flight as soon as their schedule opens, and the check prices during each sale (all the way to about three weeks before your flight) and rebook if the flight prices drop. If you pay with points, you simply get point difference deposited back into your account. If you pay with cash, you get Southwest “travel funds” good for 12 months only that can be used only for the person that purchased the original (changed or cancelled) ticket. So paying with points gives you a lot more flexibility.
“Most people would agree that transferring Chase UR points to Southwest isn’t a good use of points”.
I disagree with this. I only have one Chase card, the Chase Ink Plus since I do a lot of shopping at Office Supply Stores. I have accumulated 700,000 Ultimate rewards Points over the years. I also do not have any airline credit cards. so I do not get free bags. Transferring Ultimate rewards points to Southwest absolutely makes sense for me, since booking directly through Chase only gets me 1.25 cents per point. I also don’t travel a ton each year, so it would make no sense for me to pay the high annual fee on the Sapphire just to get a redemption rate of 1.5 cents. To me, it definitely makes sense to transfer Ultimate Rewards points to Southwest.
I have several Chase cards and I also transfer quite a bit of UR over to SW for travel. We’ve had two CP the last couple years, so we found the UR points valuable. Maybe I’m missing out on another opportunity? Now and then, I also transfer UR points to Hyatt.
That’s why I said most people, not all people.
Look, those Guys are in the business of selling clicks to get cards and, as you mentioned, this offer looks good on paper and is great marketing. They are promoting it for the cash referrals they receive from the banks.
Good work, DOC for the unbiased analysis and recommendation.
Can you elaborate on how to get approved for a Chase business card if you don’t have a business? I’ve read stories about Chase making it harder to get approved for business cards–such as requiring proof of business income, etc.
I sell some stuff on eBay, but less than $1K per year.
But those 30.000k goes towards 119k points needed for CP.
So I can get CP now (i.e ASAP), then get Biz card and MS remaining points($20). MS ain’t easy but well worth for 1 year.
Advantage over normal way: you’re getting CP faster and you can use for a while to see if it’s a good thing for you or not.