Should I Apply for Southwest Credit Cards?

A lot of newcomers are instantly attracted to the Southwest credit cards. I think this is because so many people fly Southwest and the cards are well marketed. Despite a lot of people holding these cards, I don’t think that they realize how valuable these cards can be. So here’s a close look at the Southwest credit cards and what you should consider before applying.

The airline basics

Southwest airlines has an expansive route network across the US and it’s growing in Mexico and the Caribbean. They operate a revenue-based award system meaning that the points requirement for award flights fluctuates based on the actual cash price of the ticket. If you time your bookings right, this can result in dirt-cheap redemptions to many places. And what’s great about Southwest is it’s usually pretty easy to find award seats since award seats are often plentiful. For these reasons, many travelers are attracted to the Southwest Rapid Rewards program.

The credit card basics

Southwest credit card are issued by Chase and there are currently three versions available. One is a small business credit card and two are personal credit cards. Since most new applicants will be concerned with the personal credit card versions, I’ll focus on those.

The two personal Southwest credit cards are:

  • Southwest Rapid Rewards Plus Credit Card
  • Southwest Rapid Rewards Premier Credit Card

It is possible to apply and get approved for both of these cards at the same time. By applying for both at the same time, the credit inquiries from the applications will probably be combined and you can diminish the impact on your credit score.

Note: Both of these cards are subject to the Chase 5/24 Rule, meaning that if you have opened 5 or more credit card accounts in the past 24 months, you will be denied.

The differences between the Southwest Premier and Plus

The two cards are very similar but there are a few differences. The three differences that will matter the most to a lot of people are the annual fees, anniversary bonuses, and foreign transaction fees.

Annual fee

  • Premier: $99
  • Plus: $69.

Anniversary bonus

  • Premier: 6,000 Rapid Rewards
  • Plus: 3,000 Rapid Rewards

Foreign transaction fees

  • Premier: None
  • Plus: 3%

There’s also one benefit that the Premier has that doesn’t get discussed as often.

Get A-List quicker

  • Earn 1,500 tier qualifying points for each $10,000 in purchases up to $100,000 in purchases annually which equal 15,000 TQP
This means with the Premier you earn up to 15,000 tier qualifying points per year with your card. You need 35,000 tier qualifying points or 25 qualifying one-way flights per calendar year to qualify for A-List Status, so this helps you achieve A-List much quicker.
 A-List Members enjoy:
  • Priority boarding
  • Priority check-in and security lane access
  • 25% more Rapid Rewards points earned on each flight
  • Free same-day standby
  • Dedicated A-List Member phone line

While it’s nice to get a little bonus towards A-List, I don’t value the benefits of A-List enough to warrant spending tens of thousands of dollars on the Premier card just to obtain A-list a little quicker.

Bonus categories

  • Both cards earn the same bonus rate of 2X on Southwest airfare and hotel partners and 1X on all other purchases.

For most people, I’d venture to guess that the additional $30 annual fee is what will be a big determining factor in choosing the Plus over the Premier. Keep in mind that if you value Rapid Rewards at 1.5 cents per point, then that additional 3,000 Rapid Rewards is worth $45, so for many it could make sense holding on to the Premier.

If someone is interested in one Southwest card, I generally recommend them to pick up an additional card because the sign-up bonuses can be very lucrative when you combine the two cards, as I’ll explain below.

Sign-up bonuses

While some of the perks mentioned above are nice to have, the biggest value to be had with the Southwest credit cards is with the sign-up bonuses. Right now, both cards are offering bonuses for 60,000 Rapid Rewards after spending $2,000 (the business card is offering this, too). I don’t remember ever seeing all three Southwest credit cards offering 60,000 points for a sign-up bonus so this is a fantastic time to jump on the cards.

The standard public offer is 40,000 Rapid Rewards for these cards, although it wasn’t that uncommon to see the 50,000 sign-up bonuses come around.

Getting the Southwest companion pass

The 60,000 offer is significant because it means that you don’t have to do any spending beyond earning the sign-up bonuses to earn the Southwest Companion Pass. If you’re not familiar, the Southwest Companion Pass allows a companion to fly with you for free for up to two calendar years. 

As stated, typically the best offers for these credit cards are for 50,000 Rapid Rewards so even when you get approved for two of the best Southwest credit cards and meet their minimum spend requirements (usually $2,000), you still have to spend an additional $6,000 if you’re relying on credit card spend to earn the Companion Pass. This is not always an easy task for many. 

But with these two 60,000 offers, you’ll hit the Companion Pass threshold with the sign-up bonuses alone and have a total of 124,000 Rapid Rewards to spend on your redemptions. If you’re strategic with your Rapid Rewards, 124,000 Rapid Rewards could get you very far. From Houston, 124,000 points could get me a hand full of roundtrips for me and Brad to just about anywhere we wanted to go in the US as well as many Caribbean destinations.

In fact I’ve shown before how it’s possible for the Southwest Companion Pass to be worth more than $3,000 just from using points from sign-up bonuses. But forget the dollar value of the pass, to me it’s the flexibility of being able to fly to so many different destinations for free with a partner that makes the pass so valuable. It’s saved us hundreds of dollars over the past couple of years.  

So should you get a Southwest card?

If you plan on flying domestically a lot then getting one Southwest card can make a lot of sense. But I’d always consider getting two Southwest cards and earning the Companion Pass. If you and your travel partner plan on making some trips around the US and Caribbean, then getting these two Southwest cards might be the best option for you right now, especially if you think you might be surpassing 5/24 in the future.

 Cover Photo by Pieter van Marion

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