Canadians and the US$
So, our dollar has taken a big hit, ever since the election, and it wasn't that great even before then! But if the financial wizards are to be believed, it is going to get worse in January.
So, how do you buy US$?
Do you rely on using your credit card to get points, even though you get dinged another 2.5% or higher, for the international purchase?
Or do you have a really good credit card, that doesn't charge that extra fee?
Do you just use an ATM machine, and withdraw cash as you need it?
Do you have a US$ account at your bank, or a US$ credit card? I still have a US$ account at my bank, but there is less is than $3 in there right now! Used to have a US VISA credit card as well, years ago, but since they started to charge a yearly fee, I gave it up.
Do you live in a big enough city where you can go to a Bullion and Currency Exchange? Is their rate better than your bank, that it makes it worth while to go there before your trip?
Do you set aside an amount every month, and put it in your holiday account?
Do you ignore the exchange rate completely, and just enjoy the holiday, and deal with the bill later?
Or, like so many people I know, and friends, you just won't go to the States at all for the next four years?
Interested to hear from fellow Canadians, how you make purchases while visiting Hawaii, to save on the exchange rate. Especially if you have a credit card with a low rate for International purchases!
It’s true that the exchange rate between the Canadian dollar (CAD) and US dollar (USD) can fluctuate, and when it’s unfavorable, it can make travel costs a bit harder to manage. Fortunately, there are several strategies that Canadians use to get the best value while in the U.S., especially in places like Hawaii. Here's a breakdown of some common approaches:
1. Credit Cards with No Foreign Transaction Fees
If you have a credit card that doesn't charge foreign transaction fees, this can be an excellent way to make purchases abroad. Some credit cards offer a reward program (e.g., points or cash back) that you can accumulate when you use them for purchases, including those in the U.S. Even though your credit card may have a higher exchange rate, the lack of extra fees can offset the exchange rate loss. Some credit cards specifically designed for travel or international use even offer the advantage of no foreign transaction fees, which can save you an extra 2.5% or more compared to cards with foreign transaction fees.
- Examples of No-Fee Credit Cards: Scotiabank Passport Visa Infinite, TD First Class Travel Visa Infinite, and the Rogers World Elite MasterCard (offers 3% back on foreign currency purchases).
2. Using ATMs for Cash Withdrawals
If you need cash, withdrawing money from an ATM can be a good option. Many Canadian banks have partnerships with U.S. banks, allowing for lower withdrawal fees. However, it's important to check with your bank about the fees involved, as many ATMs will charge a fee for international withdrawals. Another thing to consider is the exchange rate provided by the ATM, which can vary between banks, so it’s a good idea to check your bank’s policy before your trip.
- Tip: Look for ATMs that are part of the Global ATM Alliance (e.g., Bank of Montreal with Bank of America) to reduce fees.
3. Prepaid Travel Cards
Prepaid travel cards are another option. You load these cards with funds in advance, often at a better exchange rate than you’d get at a currency exchange service. Once loaded, you can use them just like a credit card, but they’re pre-paid. This can be a safer option than carrying large amounts of cash. Some Canadian banks offer prepaid cards that allow you to load USD at favorable rates before your trip.
- Examples: CIBC US Dollar Prepaid Travel Visa Card or the RBC U.S. Dollar Prepaid Visa Card.
4. Currency Exchange at Local Providers
While exchanging currency at your Canadian bank before you leave is an option, it’s generally not the best one, as they often offer less favorable rates. If you’re traveling to a larger city or tourist destination in Hawaii, you may find a local currency exchange service that offers better rates than what you'd get from your bank. Sometimes, airport exchange rates are even more favorable than those at your local bank or Canadian exchange services, but it's always good to shop around.
- Tip: Check exchange rates in advance at online comparison sites to ensure you're getting a good deal.
5. Setting Aside Money Monthly
If you plan your trip well in advance, consider setting aside a specific amount each month in a holiday fund. This way, you'll have a dedicated travel fund that helps cushion the exchange rate impact when you finally make purchases. While it doesn’t directly impact the exchange rate, it can help you plan for the fluctuations and set a budget for your trip.
6. Ignoring the Exchange Rate and Enjoying the Trip
Sometimes, the stress of watching exchange rates can get overwhelming. If you’re looking to focus on enjoying your holiday, it’s okay to spend without stressing too much about the rate. Many travelers find that budgeting and taking small steps to minimize currency conversion fees is enough to ensure they enjoy their vacation. If you prefer, you can deal with the exchange rate fluctuations and the bills when you return home.
7. Avoiding U.S. Travel Due to the Exchange Rate
Unfortunately, some travelers might choose to hold off on visiting the U.S. altogether if they feel the exchange rate is too harsh. This is a personal choice, but if you’re committed to your trip to Hawaii, finding ways to minimize the impact of the exchange rate can make your experience much more enjoyable without cutting out the destination completely.
In conclusion, Canadians have several options for managing currency conversion costs when visiting Hawaii. It really comes down to what works best for you, whether it’s using a no-fee credit card, relying on ATMs, or planning your trip with prepaid cards and dedicated funds. Don’t forget to keep an eye out for new cards and services that can save you money when converting currencies in the future!
