Today is the last day to book Southwest awards before the mystery devaluation occurs tomorrow.
Southwest originally launched Rapid Rewards 2.0 with 60 points being worth $1 of “wanna get away” fares. On 03/31/14 they decided that was too generous and adjusted that to make 70 points worth $1 of “wanna get away” fares.
Varying taxes can make Southwest points worth anywhere from 1.6-1.9 cents each.
Now they are moving away from a set value completely and will move towards the JetBlue model where there is a greater variance in what their points are worth based on a non-published formula.
Or in their own words,
“We created Rapid Rewards because we think you deserve to actually feel rewarded. And, from time to time we must make some updates to our program. Beginning April 17, 2015, the number of Rapid Rewards Points needed to redeem for certain flights will vary based on destination, time, day of travel, demand, fare class, and other factors. However, there are still many flights which will stay at the current redemption rate. And don’t forget that when fares go on sale, so do the points needed for redeeming for a reward flight on those fares.”
That’s about as opaque as they could possibly get.
It’s bizarre that fixed value programs need to devalue. The thinking behind devaluations in traditional mileage programs is that as airfares climb, so should the mileage required. But when each mile has a set value, why is there ever a need to devalue?
Personally I chase the aspirational aspect of miles, which means I focus on the programs that offer outsized value for premium cabin awards. And I love the BA program which offers great flat-rate awards for short-haul flights.
But people do love the Southwest program for its baggage policy and for its companion pass program. When you earn 110K points in a calendar year you can bring along a companion for free on paid and award tickets until the end of the following calendar year.
The best part of the program is that they allow free redepositing of awards. Take advantage of that now to lock in award travel at current rates. Worst case is that you can always redeposit those points if you can’t take the trip.