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How to earn the Southwest Companion Pass Thumbnail

How to earn the Southwest Companion Pass

If you’re not familiar with the Southwest Airlines Companion Pass, it’s basically the holy grail of credit card travel rewards. And for good reason! The companion pass can save you potentially thousands of dollars on travel simply by being strategic about which credit cards you use.

And it’s never been easier to earn the companion pass than it is right now.


What is the companion pass and how do you earn it?

The companion pass allows you to add one passenger, “your companion”—which can be a spouse, friend, child, etc.—to any Southwest flight you purchase, essentially for free (there is a small ~$5 charge each way for taxes and fees).

When you earn the companion pass, you get to use it for the remainder of the calendar year in which you earn it, plus the entire following year. In other words, if you hustle and earn the companion pass in January or February of a given year, your companion can fly for free on Southwest flights for nearly two years.

Normally, it’s very difficult to earn the companion pass: you must accumulate either 100 one-way qualifying flights or 125,000 qualifying points. It’s the latter of those two methods—the qualifying points route—that just got a whole lot easier.

By taking advantage of the currently-but-likely-only-temporary increased sign-up bonuses on Southwest credit cards, you can earn huge chunks of bonus points and qualify for the companion pass easily and early in 2022 and enjoy free flights for your companion for all of 2022 and 2023.


Personal Card Only vs. Personal Card + Business Card

The first question to answer will be whether you’ll have to do this by only using a personal Southwest card only (harder to do), or if you can do this by pairing both a personal Southwest card and a business Southwest card (easier to do).

The Southwest personal cards come in three flavors: plus, premier, and priority. The sign-up bonus for all three of them is the same, so all three of them will work. The bonus for these cards is 100,000 points, but it’s earned in two different 50,000-point installments. More to come on that later. This double-bonus won’t last forever—after 12/7/2021, it’s likely to come back down to where it was previously. But if you're reading this after that date, you should still check to see what the current offered bonus is. 

For the Southwest business cards, there are only two types: premier and performance. The premier card has an annual fee of $99 and a sign-up bonus of 60,000 points. The performance card has an annual fee of $199 and a sign-up bonus of 80,000 points. So, choosing the performance card over the premier card will allow you to earn the companion pass faster, but you double your annual fee.

In order to apply for a Southwest business card, you don’t have to have a registered business or own that business through an LLC or other entity, you just have to have a “business purpose”. For example, if you own a rental property, or you do some tutoring on the side, or you buy and resell goods on Facebook marketplace. Any of those activities qualify as “business purposes” even if you earn very little from them.

If you do have an activity that meets those criteria (or if you can easily start one), it’ll be much easier for you to accumulate the 125,000 points to earn the companion pass. That’s because the bonus points for both the personal card and the business card can each be applied to the same rapid rewards account number.


Applying for your card(s)

After figuring out whether you’ll be doing a personal card only or a personal card and business card, the next step is to apply for your card(s).

Something to keep in mind at this stage is that the cardholder must be the same for both cards. In other words, you can’t have one spouse open the personal card in his name and have another spouse open the business card in her name. It must be one person applying for both cards in order to apply the bonuses points to the same rapid rewards account.

If the person you’ve identified as the one who’s going to open the cards already owns a Southwest card, she won’t be able to apply for a new one. She must first close her existing card (go ahead, clutch your pearls) and then reapply for a new one. More coming later about why this is okay to do.

If the spouse who is not going to be the one applying for the new cards already has a Southwest card, there is another easy way to earn some extra points: a referral bonus.

You can easily generate a referral link from your account (you’ve probably gotten a dozen emails about it) and have your spouse use that link to apply for his new card. Voilà! You’ve earned an extra 20,000 bonus points. You can even repeat this process for both new credit cards.

This referral bonus is also temporarily high through 1/4/2022. After that, it’ll most likely drop back down to 10,000 points per referral. But again, if you're reading this after that date, go check for yourself to see the current referral bonus. 

If you can’t double-dip on points by having one spouse refer the other for the referral bonus, you can get into the Christmas spirit and make a friend’s day by having them send you their referral link and letting them get the bonus.
 
Finally, when applying for the new card(s) you’ll be asked to input a rapid rewards account number if you have one. If you’ve never had a Southwest credit card before, there’s nothing for you to input on the first application. On the second application, you’ll want to make sure you input the rapid rewards account number that you received with your first card so that both cards’ points are applied to the same rapid rewards account number.


Timing your spending to earn the sign-up bonuses

The first thing that’s very important to understand about earning the companion pass is that you must accumulate those 125,000 points in the same calendar year. On January 1st, points that you’ve earned “reset” and you start all over again for that year.

In other words, for the new credit card(s) that you’re about to apply for, you don’t want to hit the spending threshold that earns you the sign-up bonus until 2021 is over. If you earn it early, those bonus points will count towards your 2021 tally, and won’t be counted in your 2022 tally.

That means that it’s crucial to have a clear understanding of the spending thresholds that trigger the bonus points for each credit card.

For all three of the personal cards, you earn the first 50,000-point bonus after you’ve spent $2,000 within the first 3 months from account opening. Then, you earn a second 50,000-point bonus after you’ve spent $12,000 within the first 12 months.

For the Premier business card, you earn a 60,000-point bonus after you’ve spent $3,000 within the first 3 months from account opening. For the Performance business card, you earn an 80,000-point bonus after you’ve spent $5,000 within the first 5 months.

So, after you receive your card(s) this year, you can begin doing some spending on them, just make sure you’re mindful of the spending thresholds that cause you to earn the bonus so that you don’t inadvertently earn the bonus early.


Receiving your bonus points and reaping the rewards

If you’re following along with the math, you can see how these sign-up bonuses make it easy to earn the companion pass.

You get 50,000 points when you hit the first threshold on your personal card. Then you get 80,000 points when you hit the threshold on your business card (if you choose the Performance card option). That puts you at 130,000 points which is already passed the 125,000 requirement to earn the companion pass!

Even if you opted for the Premier business card option because of the lower annual fee and only got 60,000 bonus points, that puts you at 110,000 points on just the two bonuses. That’s before factoring in the points you earned from the spending you did to reach the bonus thresholds. It only requires a little bit more spending to reach the mark for the companion pass.

For those doing the personal card + business card strategy, the second 50,000-point bonus isn’t even required to earn the companion pass. But it sure is nice to have all those extra points.

When all is said and done, not only will you have the companion pass, but you’ll have 180,000+ rapid rewards points. What does that translate to in terms of flights? See below for a side-by-side comparison of December flights in points vs. dollars.

If each leg of every flight you buy is about $300, that’s 10 free flights, or 5 round-trips. If each leg is closer to $100 per flight, that’s 30 free flights, or 15 round-trips. You’ll most likely be somewhere in between, which means you’ll do quite a lot of flying before you use up your points.

That’s the surprise benefit of this approach. The companion pass lets your partner travel for free, turning every ticket you buy into a buy-one-get-one free deal, which is what you’re after. But all the points you rack up along the way means that for years you’ll be “buying” even that other flight with points instead of dollars.


My personal experience

Two years ago, Kristi and I used this method to earn the companion pass for her at the start of 2020 (in hindsight, not the best time to earn travel rewards given that a global pandemic ensured shortly after). So, she’s been the cardholder and I’ve been her companion.

Not only did all my flights as her companion cost only ~$5 in fees, but we purchased all her flights using points from those sign-up bonuses. And we still have more points left! Essentially, we haven’t paid for flights for either of us since we earned it.

Her companion pass is set to expire at the end of 2021, so we’ve already started the process of having me earn the companion pass at the start of 2022. And unless there’s a major change, I’m sure we’ll have Kristi earn it again at the start of 2024. Rinse and repeat.


FAQs and potential pitfalls

I had lots of questions before I finally pulled the trigger on this. And nearly everyone I’ve talked to about it has had questions as well. Here are the most common ones that I’ve encountered:

What if I already own a Southwest card? If you already own a personal or business card, you’ll need to close that card first before you apply for a new one. Or it may be easier for the other spouse to be the open the new cards. Also, if you do close your card, the points that are in your rapid rewards account aren’t lost. They stay there. You simply enter your same rapid rewards account number for your new card and that new card is linked to your existing rapid rewards account.

Isn’t it bad to close credit cards? Yes and no. Yes, it’s true that your credit score will likely take a small, temporary hit when you first close your card. There are a couple reasons this happens. First, when you close that card you lower your overall credit limit, which increases your credit utilization rate, and that has a negative effect on your score. Second, it also will decrease the average age of your credit accounts which also a small negative effect on your score. However, when you open your new card(s) you will increase your credit limit again and reverse the first negative effect. You’ll likely even qualify for a higher credit limit, especially if you open two new cards, making your credit utilization rate even better than it was to begin with. As to the second negative effect, the input of average age of your credit accounts is only a small “weight” in calculating your credit score. This negative impact is more than offset by the improved credit utilization rate over time.

What if I’ve signed up for a different credit card recently? The only way this may become an issue is if you’ve opened multiple cards recently. Specifically, if you’ve opened 5 or more credit cards within the past 24 months. That’s because Chase has this thing called the Chase 5/24 rule. That link will take you to a more detailed article outlining this rule, but simply put, if you’ve opened 5 or more credit accounts within the past 24 months at any card issuer, Chase will likely deny your application for another card.

Can I get the sign-up bonus again if I’ve already gotten it once before? Yes, with a caveat. You’re only allowed to get the sign-up bonus once in a 24-month period. In other words, if you already have a Southwest personal card, and you got it and earned the bonus within the last two years, you will not be eligible to get the bonus again. Chase may still approve you for the card, but if you can’t get the bonus that defeats the purpose. If it’s been more than 2 years since you got the card, you’re in the clear.

What if I don’t have anything to qualify as a “business purpose”? The ability to get both the personal and business card sign-up bonuses is really what makes the companion pass so attainable right now. If you conclude that you don’t have anything that could serve as a “business purpose”, the companion pass is not out of reach, but it’s much more difficult. It’s going to take longer to earn it. But before you conclude that you don’t have a business purpose, remember that it’s not a very high bar to cross.

What if I don’t spend enough to meet the sign-up bonus thresholds? This is the most important question of all. Everything that I’ve said so far assumes that you earn these bonuses without changing anything about your spending habits. If in the course of considering this method, you find yourself planning for expenses that you wouldn’t otherwise do just to earn the sign-up bonuses, then this whole endeavor is not worth it. This only makes financial sense if you’re earning these rewards with spending that you would do anyways even if you didn’t get these new credit cards.


Photo by Fallon Michael on Unsplash