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Southwest Credit Card -- "Is it a good deal analysis"

Got bored during landing of a southwest flight and decided to see whether or not the southwest credit card was a good deal or not… Here’s the results of that analysis.

They say you get $25,000 in pts when you apply for the card and that this is a $400 value.  So, from this we can determine what the unpublished ratio of points to dollars is.

25,000 points = $400 (Southwest dollars)
$400/25,000 —> 0.016 $/pt
or 62.5 points/$

This means that 1.6% of what you spend in dollars becomes southwest credit.

Annual Fee

$69 airline fee —> x=69/.016 —> $4,312.5 a year to break even.

However, the above doesn’t take into account you get a free 3000 points a year.
3000 (pts) * 0.016 ($/pt) = $48

So, taking that into account… You need to spend at least:
(69-48)/0.016 = $1,312/yr to recoup your $69 annual fee.

After that you get 1.6%… to me that doesn’t sound like that great of a return.  Maybe next time I fly there will be another credit card ad I can digest for comparison.

Other misc

* Can be redeemed for international travel on 50+ global carriers.
* 3% fee on foreign expenses.
* Note: you get 3.2% back on southwest and partner hotel + rental car purchases.
* Points will expire if you don’t use the card for “flight or Partner earning activity every 24 months”. I don’t know if that means you have to buy southwest flights or if just taking a southwest flight is good enough. In my case I book all southwest using a business credit card.