Heading south of the border for March break?
If you booked your trip in the summer / fall, your travels just got about 5 to 6% more expensive.
It now costs almost $C1.34 to buy $US1.00 on the wholesale market.
But if you go to your bank to buy $US, look out they are going to scalp you for another 2%.
This is the rate you are paying at one of Canada's "big 6" today:
That is an additional $30 per $1000.
Ever wonder why banks are ever growing their earnings? Certainly this is part of it.
We don't squeeze our clients.
We always have $US assets in client portfolios as part of their balanced portfolio (and we use the wholesale rate and reasonable timing to buy them $US when necessary). We can send them $US cash if they have a $US bank account, so we advise them to do so. If they use a credit card for purchases and spending (and get travel points), then they can get a $US credit card.
When they get their monthly statement, we send $US from their investment account to their $US account to pay their credit card down. Save themselves the 2% "pillaging" fee that the banks charge.
It is just one small thing that we do that makes a difference and rest assured the banks are not likely to send you in that direction .
There is an alternative, we hope that we are helping to drive the thinking in a new direction.
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Scott Tomenson,CIM Managing Partner, Chief Investment Strategist