When your points go up in value, that is something to get excited about. It seems like every week some airline is devaluing your points or making them more difficult to redeem. My loyalty for Southwest runs deep, so let me just put that out there.
I often scan the Southwest Map Search tool looking for good deals. One of the ways I save money (or points) on travel is to use positioning flights to essentially “piece together” my travel. A positioning flight is one that gets you to a destination to then catch a secondary flight. For example, a normal flight from Phoenix to Philadelphia may cost $135 one-way with a stop in Dallas. To save money I would book a one-way from Phoenix to Dallas for $44 and then from Dallas to Philly for $54. This would save me $37 one-way and I would be on the same flights, just two separate itineraries.
When browsing Southwest Map Search earlier today I spotted the cheapest flight that I can recall. Prior to today the cheapest points fare I had come across was 1,400 points, which typically coverts to about $37 cash. The flight I saw today was 1,099 points one-way! This was from MSP to MDW and there were multiple dates at that rate. The cash price for this 1,099 point flight was $31, which is incredibly inexpensive.
Why should you care? If you don’t plan on going to either one of these cities, you may not give a crap. That said, the important thing to note is the value of the points. If you divide $31 by 1,099 you get a value of .0282. That means in this case your Southwest points would be valued at up to 2.8 cents per point! That is an amazing value especially if you think about all the ways you can earn Southwest points. You can do your taxes for free on TurboTax and earn 1,000 Southwest points. Keep in mind, you are required to pay the $5.60 security fee when using your points so technically the 2.8 valuation is a bit lower, but you get the idea.
At a 2.8 cents-per-point value you are getting into Hyatt and SPG territory, which is great! Look at it this way, if you have Chase Ink and buy gift cards at office supply stores for 5x points, you can get up to 14 cents per dollar spent. (at office supply stores with Chase Ink transferred to Southwest) If you bought a $200 Kohl’s gift card at Staples with Chase Ink, that would earn you almost $30 in Southwest flights (less the $5 security fee, yes, yes)
Moral of the story, make sure you are maximizing your daily spend as well as your redemption. With many of the manufactured spend options drying up it makes our point redeeming more important than ever.