First off: let me admit I am no financial advisor. Do not bet your life savings on what I say. But I can read, and almost universally the people who are currency exchange experts are predicting anxious days ahead for the Canadian dollar.
After a four-month slump, the loonie remains in the .75 to .76 USD range, and if the US Fed raises interest rates soon (as is widely predicted) the pressure will likely push the loonie further down.
Sadly, there are very few experts who see the loonie strengthening significantly any time soon—especially if the Bank of Canada ultimately lowers its interest rates, which some see as a possibility—although not imminently.
This means you need to prepare for the eventuality of having to spend more of your disposable income than you planned on your next vacation or snowbird trip to the US this coming winter season.
Seasoned Canadian travelers to the US have learned over the years to make use of the US dollar accounts available to them by all national banks: deposit into the US account when the loonie is high (or stable), and protect its value against any future drop.
Snowbirds know the value of this hedge well. And some of them can still remember “investing” when the loonie and the Greenback were at par, then watching the loonie slide while their “investment” held rock solid.
It’s a different story now. As the experts tell us, we’re not looking at a return to parity anytime soon, so the best you can hope for is to keep your travel investment stable. Talk to your financial advisor if you have one, or your banker. Ask their advice and make your decision knowing all of the facts and probabilities.
And bear in mind the good side of the story: once you cross the border your gas will cost you far less than you are paying in Canada. Today, gas in Winter Haven, Florida, averages about $2.00 USD per gallon (.53 USD per liter/.70 CAD). In Apache Junction, Arizona, the price is down to about $1.84 USD.
And a 1.75 liter bottle of Canadian Club can still be had for $16.99 USD in South Florida. So there are tradeoffs.
Varying exchange rates can have a major effect on your disposable spending when traveling across borders. It is something you have to plan for. This is nothing you want to gamble with, but you do need to protect yourself against unknown, perhaps volatile factors.
Play it safe. You won’t be sorry.
Do you have plans to cross the border this winter? Do not forget your travel insurance.