Happy Victoria Day Canada! We certainly hope that you are enjoying a relaxing and rejuvenating long weekend. This is the weekend that many Canadians most look forward to all year as it unofficially marks the beginning of summer. If you’re a resident of Toronto – where Synergy is headquartered – this was certainly the case this year.
Experiencing a long stretch of rainy days last week, Toronto finally got to experience some bright and sunny weather this past Saturday. And even though the clouds are out today, signs of brighter days to come are surely here. This year’s Victoria Day weekend is also being marked by a notable increase in cross-border shopping.
With the Canadian dollar being so strong at the present time, many Canucks are taking advantage of the holiday by heading south to the United States to do a bit of shopping. Taking advantage of the stronger loonie, however, is something that one should do wisely, according to Madhavi Acharya-Tom Yew.
In an article published in the Moneyville section of The Toronto Star‘s website this weekend, Acharya-Tom Yew remarks that Canadians may be able to get more bangs for their bucks depending on which method of payment they decide to use. Is it better to use American cash or a Canadian credit card?
Acharya-Tom Yew reminds shoppers that taking both methods of payment along with you on your cross-border trip is important. Remember that you will need some cash for things like tolls, taxis and other incidentals. However, paying for other items in cash may not provide for you the same type of savings that you would get if you put the charges on your credit card.
Writes Acharya-Tom Yew: “It cost $100.72 Canadian to buy $100 U.S. at the CIBC last Tuesday — even though the loonie traded at almost $1.03 U.S. on currency markets that day.” In addition, banks often include currency conversion fees when exchanging Canadian cash for American. Sometimes, it’s as much as four per cent.
However, she notes, when you use a Canadian credit card in the United States, you will get the exact exchange rate at the time of the purchase. Although there is also a markup on the rate in this case as well, it usually is around the 2.5 per cent mark. Your best bet, according to Acharya-Tom Yew, is to “open a U.S. dollar account at a Canadian bank you can exchange money when the rate is favourable — and you may earn some interest.”