Thanks to 2 rewards cards and the Southwest Companion Pass, I book almost all my family's travel with points

FILE PHOTO: Southwest commercial airliners taxied at McCarran International Airport in Las Vegas, November 19, 2014.  REUTERS/Mike Blake/FILE PHOTO: Southwest commercial airliners taxied at McCarran International Airport in Las VegasReuters

Using some simple strategies, I'm able to travel several times a year at virtually no cost. In fact, I recently flew to Florida for work, took my mom for free on a Companion Pass (no points were used for her flight), and pocketed $657 in Southwest Airlines credit.

I've also flown round-trip to New York City three times this year plus two round-trip airfares to Honolulu. In fact, Travel + Leisure recently launched a "bleisure" section highlighting business leisure travel, and featured my tips.

Here's how I use the Southwest Companion Pass and the airline's co-branded credit cards to earn as many Rapid Rewards points as possible and fly with my family for nearly free.

Keep in mind that we're focusing on the rewards and perks that make these credit cards great options, not things like interest rates and late fees, which will far outweigh the value of any points or miles. It's important to practice financial discipline when using credit cards by paying your balances in full each month, making payments on time, and only spending what you can afford to pay back.

All household expenses earn us points

The key is accumulating points. Years ago, this meant making sure my personal Rapid Rewards number was on any Southwest flights my work purchased. There were only a few of those, but it gave me a couple of thousand points. Then, in 2009, my husband and I enrolled for the Southwest Rapid Rewards Premier card and set up most of our automatic bills to be charged to the card.

To this day, we use the Southwest Premier card to pay our homeowners insurance, auto insurance, and cell phone bills. We also put our groceries and household supplies on the card, and anything else, really, that we can to earn the points.

For this system to work to our benefit, we have to pay the card off every month. The APR otherwise is pretty high and would eat up any benefit of free airfare, as would, of course, late fees. There's an annual fee of $99 for this card, but I don't mind it. (Also, the US federal government requires a TSA security fee of $5.60 to be paid on all airline tickets, including frequent flyer awards.)

Click here to learn more about the Southwest Premier card.

My business expenses earn points

Five years ago when I set up banking and accounts for my business, I knew I'd want to use a Southwest card for business expenses, too. The first few months I used a bank credit card, but after I had all my business registration set up, I applied for a Southwest Rapid Rewards Premier Business card with a $99 annual fee, and I set up all automatic expenses to be charged to the card.

In my line of business, we buy pay-per-click ads for clients, and that can add up pretty quickly. We also have several independent contractors who do work for us regularly, and the invoices are charged to our Southwest Premier Business card.

My husband's business expenses earn points, too

Earlier this year, my husband got back into his own business on the side. He works full-time as a construction superintendent, but he'd previously spent 25 years installing and refinishing hardwood floors. The area in which we live has a booming housing market, but few people with the skill set for hardwood floors. As more and more people asked him to work, we went ahead and set up a small business this spring to manage all of it.

Again, we set up as many automatic expenses as possible to be paid with the Southwest Premier Business card. Then, we also use the card for any business expenses. On an install project, that can also mean that we have to buy anywhere from $5,000 to $10,000 in materials. Those expenses go on the card, are paid in full every month, and are covered by the deposit we require customers put down to start their project.

The Companion Pass is the holy grail of free travel

The Southwest Companion Pass is one of the most unique (and valuable) benefits in the world of frequent flyer programs. It allows you to designate one person to fly with you at no cost beyond taxes and fees. The companion pass is good for a full calendar year plus the months of the year left in the calendar year earned, so the best strategy is to earn it as early into a new calendar year as possible. You can change your companion up to three times per year.

To qualify for a Southwest Companion Pass, you have to earn 110,000 qualifying points or fly 100 qualifying one-way flights in a calendar year (starting in 2020, you'll need to earn 125,000 qualifying points). Points you earn from Southwest credit card sign-up bonuses, as well as points you earn from credit card spending, count toward this requirement, so it's not hard for us to earn this benefit.

I've taken my husband to New York City for free as a companion, my daughter to Florida last year for a wedding, and my mom to Hawaii a couple of months ago as well as Florida just last week.

Since Rapid Rewards accounts are individually owned, only one personal credit card and one business card can be tied to it. (A business can't own Rapid Rewards points; only a person.)

When we opened my husband's Southwest Rapid Rewards Premier Business card, we had to assign it to his Rapid Rewards account. While I was initially annoyed both of our business cards couldn't earn rewards to one Rapid Rewards account (mine), this actually works in our favor in two ways.

First, we earned a sign-up bonus 60,000 points (the Premier Business card is currently offering a welcome bonus of 60,000 points after you spend $3,000 in the first three months). Second, there's a possibility we can get a Companion Pass on his Rapid Rewards account as well as mine, which means we could each easily add a daughter as our companion and take our family of four on a trip for free!

Get a voucher if your plans are flexible

I hadn't known the beauty of overbooking compensation until a recent Southwest flight (which I booked using points and my mom flew for free on my Companion Pass). While we were waiting to board our flight from Ft. Meyers, Florida home to Kansas City, an announcement was made. Southwest Airlines had overbooked the flight and if someone was willing to take another flight, they'd be reimbursed for their flight and given a bonus voucher.

The first time the announcement went over the loudspeaker, I thought it wouldn't be worth the risk of not making it home that day or that maybe I wouldn't qualify because I'd used points to book the flights. The second time the announcement came over the loudspeaker, the Southwest employee said, "If your final destination is Kansas City, I can get you on another flight, boarding now, and will arrive only 2 hours later than this booked flight."

Getting a few hundred dollars for getting home just a couple of hours later seemed like a pretty good deal. Then, to my surprise, the Southwest LUV voucher the employee handed me was for $400. Then another voucher for $257 printed and was handed to me. I was given $657 compensation for flights I hadn't even paid for! It was magical.

From what I could gather on the SW Airlines website, overbooking seats can happen every now and then, and if someone volunteers for a different flight, they receive a $100 voucher, plus the reimbursement of the one-way tickets. It wasn't all sunshine and rainbows; my mom and I did end up sitting on the runway for those 2 hours due to weather, but that might have happened on our original flight anyway.

My family reaps the rewards

This might sound like a lot of work, and it may not be worth it if you don't like to travel. But our family loves it. We're going to Corpus Christi in December this year and are planning something more tropical like Hawaii or Belize next Christmas. I used to think you had to be really rich to be able to travel, but that's really not true if you play your points right.

Click here to learn more about the Southwest Premier Business card.

Disclosure: This post is brought to you by the Personal Finance Insider team. We occasionally highlight financial products and services that can help you make smarter decisions with your money. We do not give investment advice or encourage you to adopt a certain investment strategy. If you take action based on one of our recommendations, we get a small share of the revenue from our commerce partners. This does not influence whether we feature a financial product or service. We operate independently from our advertising sales team.

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Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.

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