Southwest this week began notifying Rapid Rewards members that, effective on March 31, 2014, their points will be worth less. Here's the notice posted on the Southwest website:
Wanna Get Away reward flight bookings made on or after March 31, 2014 will require 70 points per dollar, an increase from the 60 points per dollar that is currently required.
Wanna Get Away tickets are the restricted fares purchased by the great majority of Southwest customers, so the change will affect most Rapid Rewards members.
At the current 60 points per dollar level, a Rapid Rewards point is worth about 1.67 cents when redeemed for a Wanna Get Away award ticket. When the new policy takes effect, points will decrease in value by 15 percent, to 1.4 cents each.
So, for example, that 50,000-point sign-up bonus for a Rapid Rewards credit card that's currently worth around $835 would fall in value to just over $700.
That's a significant devaluation to a key component of the program overall.
As with any upcoming loyalty-program devaluation, there are a couple of take-aways here. The first: Redeem your Rapid Rewards points before the devaluation takes place. In this case, Southwest has given members plenty of time to take advantage of the current redemption rate. The second, more general reminder: Don't hoard points. The danger of such devaluations is ever present, and the more points you have in your account when they occur, the greater will be your loss. Redeem points sooner rather than later.
Reader Reality Check
How will this program change affect your loyalty to Southwest?
This article originally appeared on FrequentFlier.com.