One of the most Canadian personal finance questions is where to find the best deal on buying U.S. currency.
Whether you travel to the United States for business or pleasure, or you own property there, exchanging Canadian dollars into U.S. currency is a costly and sometimes confusing chore. A recent reader question highlights the uncertainty people feel about whether they’re getting a good deal on foreign exchange.
“I have to purchase US$20,000 over the next 26 months,” this reader wrote. “I’m looking to better understand the difference between the exchange rate posted by the Bank of Canada and the rate my bank posts. Who offers the best exchange rates?”
Please share your thoughts on where to find the best foreign exchange deals by e-mailing me at rcarrick@globeandmail.com. I’ll share the results in an upcoming newsletter. For now, here are a few important points about changing Canadian dollars into U.S. currency.
A list of forex for the Canadian dollar against major global currency rates
To start with, the rate posted by the Bank of Canada is a rate that applies to big institutions – individuals buying U.S. dollars should expect to pay a markup over this rate. Bank branches are a ready source of U.S. dollars, and some of their ATMs dispense it. But banks tend to have the highest markups, which mean your Canadian money will buy fewer U.S. dollars.
Readers have reported competitive foreign exchange rates at Knightsbridge Foreign Exchange, and the Canadian Snowbird Association’s currency exchange program. Also take a look at Wise, which is an app for managing payments and transfers in multiple global currencies.
Here’s a sample of foreign exchange rates for Oct. 8:
- The Bank of Canada says $1 in Canadian currency equals 0.732 in U.S. dollars
- Bank of Nova Scotia quotes a Canadian dollar at 71.5 cents for buyers of U.S. currency
- TD Canada Trust quotes 71.8 cents
- Wise quotes 73.2 cents, with fees totalling $9.71 for a $1,000 purchase of U.S. dollars; you get a fully itemized summary of the transaction
The convenience of a bank branch may work for small, routine purchases of U.S. dollars, but you pay for it.
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Ask Rob
Q: As one of so many TC Energy shareholders, what do I do with the SOBO shares we just received? Hold? Sell?
A: My colleague David Berman answered this question in a recent story. I have some TC and I’m hanging on to my South Bow shares. South Bow, stock symbol SOBO, was spun off from TC this month. For every TC share they own, investors received 0.2 SOBO shares.
Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length and clarity.
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