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As loonie nears parity, RBC provides tips and advice for
U.S. bound travellers
TORONTO, October 19, 2010 — With the Canadian
dollar hovering close to parity again and the annual peak
shopping season just ahead, many Canadians are looking to
maximize their budget by travelling to the U.S., either for
a short shopping trip, a vacation or as a winter snowbird.
RBC Economics forecasts the Canadian dollar to remain close
to parity through the end of 2011. While some of its strength
may ease slightly over the second half of next year, RBC expects
the Canadian dollar to finish 2011 at a still strong 98.00
U.S. cents.
"With a rising Canadian dollar and many thinking about
venturing south of the border, it's important to consider
a few simple tips to help save money and enjoy a safe cross-border
experience," said Ashif Ratanshi, head, Branch Investments,
Deposits and Direct Investing, RBC. "Whether you're looking
for deals or taking a mini vacation, it's always a good idea
to consider your options for cross-border banking before you
leave home."
Ratanshi offers the following six tips:
- Open a U.S. savings account - A U.S. savings account
is an option to consider if you are planning a U.S. vacation
or shopping trip or if you have money left over from your
holiday. Look for an account with low or no fees that enables
you to take advantage of exchange rates when they are favourable
and gain interest. Some will also allow you to purchase
U.S. dollars through online banking at a preferential rate
by simply making a direct transfer from your Canadian dollar
bank account to your U.S. savings account from anywhere.
- Use a U.S. dollar credit card - Frequent U.S.
travellers may want to consider a U.S. dollar denominated
credit card, which gives cardholders the flexibility to
make transactions in U.S. funds and avoid the hassles of
exchange rates or daily currency fluctuations. Coupled with
a U.S. savings account, it also allows holders to take advantage
of favourable exchange rates over time using dollar cost
averaging and then pay off their card balance using U.S.
funds directly from their savings account.
- Consider cash alternatives - Debit or credit cards
along with U.S. travellers cheques are easy and secure alternatives
to carrying large amounts of cash when shopping or travelling.
Credit cards are hassle-free and accepted virtually everywhere
and many come with purchase protection and extended warranties.
Cross-border debit service only requires your bank card
and Personal Identification Number (PIN) for ATM withdrawals
or purchases at any of the 1,000,000 merchants in the U.S.
that use the NYCE network. Travellers cheques are easy to
cash and come in many denominations.
- Make cross-border banking work for you - If you
often travel to the U.S. or are one of thousands of Canadian
snowbirds who head to the U.S. over the winter, consider
a cross-border banking arrangement that provides access
to your banking services on both sides of the border including
U.S. mortgages.
- Remember to pack travel insurance - Don't forget
about travel insurance when planning short cross-border
trips. Regardless of the length or type of trip, it's important
to consider emergency travel medical insurance as medical
treatments in the U.S. can be very expensive. Frequent travellers
should consider a multi-trip annual plan to save both time
and money.
- Look for easier financing options if buying property
in the U.S. - If you are thinking about buying U.S.
real estate and you have sufficient equity in your current
home, consider a loan or line of credit secured against
your Canadian home to buy your U.S. property. This will
avoid the need for a U.S. mortgage approval and property
appraisal.
For more tips on what you can do to plan a short vacation
to the U.S. visit www.rbcroyalbank.com/travel/vacation.html.
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Media Contacts:
Kathy Bevan, RBC Corporate Communications, 416 974-1757
Kerry Gaetano, RBC Corporate Communications, 905 816-5583
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