The Southwest card makes sense only if you fly Southwest regularly and spend enough to cover the annual fee
Southwest credit cards come in several versions, each with an annual fee between $69 and $99. The main benefit is a companion pass — a second ticket at the price of taxes and fees only — but you get it only if you spend enough in the first year to trigger it. If you fly Southwest two or three times a year and don't spend heavily on the card otherwise, the annual fee will cost you more than any rewards you earn back.
The card's value depends entirely on three things: how often you fly Southwest, how much you spend on the card outside of flights, and whether you can use a companion pass before it expires (usually 12 months after you earn it). If none of those three align, you are paying a fee for a benefit you will not use.
Key Takeaways
- Southwest cards charge $69 to $99 per year and require you to spend $1,500 to $2,000 in the first year to earn a companion pass that covers a second ticket.
- The companion pass is worth roughly $200 to $400 depending on the route, so you need to actually use it to break even on the annual fee.
- You earn points on every purchase, but Southwest points are worth less per point than rewards from cards with no annual fee, so the card only pays off if you fly Southwest frequently.
- If you fly other airlines or rarely travel, a no-annual-fee card with cash back will almost always save you money.
- The card's real cost is not the annual fee — it is the opportunity cost of spending money to hit the companion pass threshold when you might not need to travel that much.
How much you have to spend to get the companion pass
Southwest cards require you to spend between $1,500 and $2,000 in the first year to earn the companion pass. The exact amount depends on which card version you choose. Once you hit that spending threshold, the pass arrives by mail within 4 to 6 weeks.
This is where the math breaks down for most people. If you do not naturally spend $1,500 to $2,000 on a credit card in a year, you should not open this card to chase the threshold. Spending money you would not otherwise spend just to unlock a reward is the opposite of saving money. The companion pass is only valuable if you were going to spend that amount anyway — on groceries, gas, dining, and other regular expenses — and you straightforward shift that spending to the Southwest card.
What the companion pass is actually worth
A companion pass lets a second person fly with you for the cost of taxes and fees only, which typically runs $5 to $15 per flight. A normal Southwest ticket on the same route might cost $150 to $400 depending on when you book and how far you fly. So the pass saves you somewhere between $150 and $400 per round trip.
To break even on a $69 annual fee, you need to use the companion pass at least once per year. To break even on a $99 fee, you need it to save you at least $99 worth of ticket cost. Most people who use the pass use it once or twice a year, which means the card pays for itself — but only if you were already planning to fly Southwest and bring someone with you.
If you fly solo, or if you fly Southwest but have no one to bring, the companion pass has zero value to you. In that case, you are paying an annual fee for points that are worth less than the cash back you would earn on a no-fee card.
How Southwest points compare to other rewards
Southwest cards earn 2 points per dollar on most purchases and 3 points per dollar on Southwest flights and certain partner merchants. One Southwest point is worth roughly 1.3 to 1.5 cents when you redeem it for a flight, depending on the route and how far in advance you book.
A no-annual-fee cash back card typically earns 1.5% to 2% cash back on most purchases. That means $100 in spending earns you $1.50 to $2.00 in value. A Southwest card earning 2 points per dollar on the same $100 gives you 200 points, worth roughly $2.60 to $3.00 — but only if you redeem for Southwest flights. If you want cash instead, Southwest does not offer that option.
The gap narrows if you fly Southwest frequently, because you earn 3 points per dollar on flights themselves. But if you fly other airlines, or if you want the flexibility to use your rewards for anything, the no-fee card wins almost every time.
When the Southwest card actually makes financial sense
The Southwest card is worth considering if all of these are true: you fly Southwest at least twice a year, you have a travel companion you fly with regularly, you spend at least $1,500 per year on credit cards anyway, and you book flights far enough in advance to get reasonable prices. In that scenario, the companion pass pays for the annual fee, and the points you earn on top of it are a bonus.
It also makes sense if you are chasing a specific travel goal — say, a trip next summer where you want to bring a partner — and you can hit the spending threshold naturally over the next 12 months. In that case, the card is a tool for a specific trip, not a permanent part of your wallet.
The card does not make sense if you fly other airlines, if you travel solo, if you rarely fly at all, or if you would have to spend money you would not otherwise spend to hit the companion pass threshold. In those cases, a no-annual-fee card with cash back or flexible points will save you money.
The hidden cost: locking yourself into one airline
Carrying a Southwest card means you have an incentive to book Southwest flights even when another airline is cheaper or more convenient. That incentive is real, and it costs you money over time. If you find a better price on United or American, you might book Southwest instead to earn points, and that decision costs you the difference in ticket price.
This is especially true if you live in a city where Southwest does not have strong service. If your nearest hub is a United or American city, you may pay more to fly Southwest just to earn points on a card that costs you $69 to $99 per year. That is a double cost: the annual fee plus the premium you pay for worse flight options.
How to decide: the three-question test
Ask yourself these three questions in order. If you answer no to any of them, a no-annual-fee card is the better choice.
First: Do you fly Southwest at least twice a year? If not, you will not use the companion pass often enough to justify the annual fee. Two flights per year is the bare minimum; three or more is better.
Second: Do you have someone you regularly travel with? If you fly solo, the companion pass is worthless. If you sometimes travel with family or a partner, the pass has value, but only on trips where you both fly.
Third: Do you spend at least $1,500 per year on credit cards for regular expenses? If you do not, do not open this card. If you do, make sure that spending is already happening — not spending you are creating to hit the threshold.
If you answered yes to all three, the Southwest card is worth a closer look. If you answered no to any of them, move on to a no-fee card.
Frequently Asked Questions
Does the companion pass work on all Southwest flights?
The companion pass works on any Southwest flight you book, but it does not waive the taxes and fees for the companion — only the base fare. You also cannot use it on flights booked with points, and some blackout dates may explore depending on the specific card and promotion. Check Southwest's website for the exact rules on your card version.
What happens if I don't use the companion pass before it expires?
The pass expires 12 months after you earn it, and Southwest does not extend or refund it. If you earn the pass in January but do not fly until March of the following year, you lose it. Plan your travel before the expiration date, or do not open the card if you cannot commit to using it within that window.
Can I downgrade to a no-annual-fee Southwest card instead of closing the account?
Yes. Most issuers allow you to downgrade to a no-fee version of the same card after the first year, which keeps your account open and your credit history intact. You lose the companion pass benefit, but you also stop paying the annual fee. This is a good option if you want to keep earning Southwest points without the yearly cost.
Is the sign-up bonus worth more than the annual fee?
Southwest cards typically offer a sign-up bonus of 40,000 to 75,000 points if you meet the spending threshold. That bonus is worth $500 to $1,000 in flight value, which easily covers the annual fee. However, you still have to spend $1,500 to $2,000 to get the bonus, so only pursue it if that spending is natural for you.
What if I have a Southwest card but I'm not using it anymore?
If you are not flying Southwest regularly, downgrade to a no-fee card or close the account. Paying an annual fee for a benefit you do not use is money wasted. If you think you might fly Southwest again in the future, downgrading keeps the account open without the cost.