Update: After much outcry, Southwest is allowing hotel transfers to count towards the Companion Pass to 3/31/17.
I’m sure you probably saw the big news yesterday that effective 1/1 and without any warning whatsoever, Southwest will no longer count hotel transfers or bonus points from other partners towards qualification for the Companion Pass. This is pretty big news, especially for those over Chase’s 5/24 rule, as it kills an easy way to get the Companion Pass. We are only a day into 2017 and we’ve already seen the first major negative development this year.The timing of this isn’t coincidental – the folks at Southwest are very aware of the plans many travel hackers use to earn the Companion Pass. Each plan, if you weren’t aware, involves acquiring 110,000 Southwest points as quick as possible at the beginning of the year to maximize the Companion Pass as it is good for the year it is earned in and the following year. The more popular plan was for folks to signup for 2 Southwest credit cards with a 50,000 point signup bonus and after meeting minimum spend, that would give them 104,000 points. To cover the remaining 6,000 points many people transferred points from hotel programs to Southwest and boom a Companion Pass was obtained.
The newer plan, which was discussed heavily on blogs when the Marriott-SPG merger was announced, involved redeeming 90,000 SPG Starpoints for a Companion Pass by transferring those points to Marriott (which turned into 270,000 Marriott points due to the 1:3 transfer ratio) and then redeeming the Marriott points for a flights & nights package. This gave you 120,000 Southwest points, the Companion Pass AND a 7 night stay a category 1-5 Marriott. That was a pretty amazing deal – especially if you were over Chase’s 5/24 rule and couldn’t complete the other plan. However, some would argue this was too good a deal and that is what led to Southwest cracking down on this easy way to acquire a Companion Pass.
The best way for many of you to earn the pass going forward if you are under 5/24 is to still acquire the two Southwest credit cards when the bonus is 50,000 points and put an additional $6,000 of spending on those cards. The 100,000 signup bonus points + 4,000 points for meeting the minimum spend + this extra 6,000 points in additional spend will result in the Companion Pass. If you can’t or will struggle to spend the extra $6,000 you could always use a service like Plastiq to pay bills you are normally not able to with a credit card such as a mortgage, student loan etc. They do charge 2.5% of the payment so if you had to spend all $6,000 through Plastiq, that would be $150 in fees – less if you can put normal, everyday spending on the card and only supplement the extra amount needed via Plastiq. If you are over 5/24, I think you can effectively say goodbye to earning a Companion Pass unless you have a TON of paid travel on Southwest.
With the timing of the New Year, Southwest knew very well that many people were gunning to acquire a Companion Pass at the very beginning of 2017. They effectively beat travel hackers to the game and cutoff the option while many of us were recovering from our New Year’s hangover. Therefore to start the year off let’s score it as Southwest 1, Travel Hackers 0.