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currency exchange - USA or Canada

indianapolis
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currency exchange - USA or Canada

Is it better to exchange currency in the united states or when you get to Canada. Also is the exchange rate better with cash or money orders. If anyone has any knowledge of this matter, any help would be appreciated. Thanx

indianapolis
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1. Re: currency exchange - USA or Canada

It must be past my bedtime. I meant travellers checks instead of money orders. I recently went to Japan and when I exchange money there, I got a better rate when I exchange travellers checks for some reason. I was wondering if the same was true in Canada. Also I'm flying into Toronto I YYG--- maybe, and wonder whether it would be better to exchange at the airport when I get there or at a bank.

Chatham, Ontario
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2. Re: currency exchange - USA or Canada

I cross the border weekly, bank in both countries, and seem to exchange money every few days for one reason or another. As a general rule, you will get a better exchange rate in Canada, either at a Canadian bank, or at a duty free/border exchange booth, or at a casino.

Right now, at XE.com (check this again just before you travel)

$100 US = $113 CNDN

$100 CNDN = $88 US

These are the official rates at which banks in every country buy and sell. You and I will always get less.

Most Canadian banks will charge you $90 US at the moment to buy $100 Canadian. In addition, you will likely have to pay a transaction fee of $5. However, if you are exchanging more than $100, the better rate you get will still make this a better deal (see below) Because I live in a small town, I often hear about the fee being waived, but don't search out a one-stoplight-wide-spot-in-the-road to try to save $5 - it will either happen, or won't.

Depending on a lot of details, you will usually lose about 4% by exchanging at a US bank and bringing the cash in. Today, Bank of America will charge you $94.00 US to buy that same $100 Canadian. Other banks are about the same.

Despite a forest of posts to the contrary (and I am sure to be flamed/contradicted on this thread by posters who don't believe me) the WORST thing you can do is come to Canada with your ATM card, and exchange that way. You will not only get that 4% less rate your US bank gives, you will also (likely) have to pay a "transaction fee" that can be as much as $5 each time you do this! Never make repeat small withdrawals!

Banks are not always open when you want them to be, and the duty free shops do 24 hour a day exchange at land crossings. (Don't even think of exchanging in an airport - those rates always are bad) There rates can be as good as the Canadian banks, or as bad as the American banks, but at least none charge transaction fees. Know the rate, so you can say "no thanks", then go to a Canadian bank.

Generally, Canadian casinos give the same rate as Canadian banks, PLUS don't charge the transaction fee. But, driving out of your way to a casino (there are none in Toronto) isn't a great idea.

If you are coming from Chicago by car on I-94, and crossing at the Bluewater Bridge (continuing to Toronot on 402 and 401) you will be able to get the best exchange rate of all. Immediately after customs (ask the Canadian border guard!) there is an exchange booth right there in the customs plaza (I'm NOT referring to the duty free shop) Day in and day out, this little spot gives you a dollar more on a $100 exchange than you get anywhere else, PLUS charges no fee. There is no telephone number or internet address for the place (I've looked), but I strongly recommend stopping there if you're driving this route.

Finally (sorry for the long post) when you use your credit card, you'll get a less than wonderful exchange rate as well. Please take a look at this Washington Post article. I've created a tiny URL:

http://tinyurl.com/e3lcg

Even I concede you sometimes just have to go ahead and use a credit card, but do factor in this added cost when deciding if the item is a "bargain" or not.

Chatham, Ontario
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3. Re: currency exchange - USA or Canada

Sorry - was typing my post as you made yours. Yes, occasionally travellers checks mean a fractionally better exchange rate, but it's not worth getting them if you have to pay a fee.

DO *NOT* EXCHANGE MONEY IN THE AIRPORT! It's better to get a few Canadian bucks from your bank, or charge the airport transportation on your credit card than deal with their highway robbery rates.

Wait until you get settled at your hotel, then ask the front desk about the closest banks.

One final tip - your hotel and many businesses will be very happy to take your US $ for purchases and "exchange" for you, but in general the rate will fatten their wallet at your expense. Don't hesitate to post again with more questions - as you can tell, I'm a fanatic on this subject, and *thrilled* an informed traveller is looking into this issue.

indianapolis
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4. Re: currency exchange - USA or Canada

Thank you so much. This has been helpful!!!!

Toronto, Canada
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5. Re: currency exchange - USA or Canada

Fannish, what do you think of the deal Bank of America has with Scotiabank, where their customers can use the other bank's ATM without any fees? Or credit unions that don't charge "out-of-state" ATM fees? I agree that ATM fees are often ridiculously high, but it seems like a no-fee ATM withdrawal would be a decent deal -- and very convenient.

Chatham, Ontario
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6. Re: currency exchange - USA or Canada

As I understand it, Matt, you're getting the Bank of America exchange rate, not the ScotiaBank one at the ATM. (That's actually why I chose to quote their rate) So, while Bank of America doens't charge you any extra fee, your account will be debited $94 if you pull $100 Canadian. If all you need is $100 Canadian cash, that's dandy, and a good deal. However, if you figure that your weekend is going to cost around C$500 for hotel, meals, cabs, whatever, you're better off going to a bank and paying $444 US, getting your C$505 ($500 + 5 service fee), instead of paying $470 for $500 through the ATM. That's $26, just for going inside the bank, rather than using the machine - IMHO, worth the trouble.

No one who has gone the ATM route has been willing to name the exact rate they got on an exact day so I can verify it's Bank of America's rate. My Michigan bank isn't a Bank of America, but I'm tempted to open an account to try it myself. Hmmm....new project for tomorow's border run to check my P.O. box...

Chatham, Ontario
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7. Re: currency exchange - USA or Canada

sorry...here I am, talking numbers, and can't even do the math...that $505 will cost $455 at a Canadian bank, so the saving is $15. Only the traveller can say if not having to go inside a bank, not having to carry C$500, and being able to use the ATM any number of times instead is $15 of convenience. But remember - only try this IF you use Bank of America and ONLY at a Scotia ATM. They should be easy to find...

Chatham, Ontario
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8. Re: currency exchange - USA or Canada

...and of course, if you're planning on doing a lot of shopping, and therefore want $1000 Canadian, ATM exchange will cost $940, inside the bank $905....the more you need to change, the bigger the difference gets...

Toronto, Canada
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9. Re: currency exchange - USA or Canada

Wow, you do take this seriously. :)

It'll be interesting to see what happens if the exchange rate gets so close that the US dollar is still worth more, but once the service charges are factored in, you end up getting less than parity. I wouldn't want to be working in a currency exchange booth having to explain that to people...

Swartz Creek
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10. Re: currency exchange - USA or Canada

Outstanding work Fannish. You have performed a great service on this question. I agree with you totally. You just confirmed what I always thought was true, but you added the details. I have always found the best rate at the currency exchange booth on the Sarnia side. It's so easy to pass it if your not looking for it. The best part of ATM's are the convenience. Well done!