Currency Exchange Facts & Myths

Ask almost any Canadian and they can tell you within a penny or two what the Canada/US exchange rate is.  It seems the national pride rises and falls in relation to the exchange rate of the Canadian dollar to the US dollar.  In our experience, there is a lot of confusion in the area of currency exchange and this section aims to clear some of it up.

	Myth - You lose money when you convert
	Myth - Wait to convert
	Myth - Someone knows where the exchange rate is going
	Fact - How to calculate exchange rates
	Fact - There is an expense to converting

Foreign Exchange Issues

One of the greatest concerns of most snowbirds is the plight of the Canadian dollar against the U.S. dollar. Rising health care, travel costs and customary lifestyle expenditures can take a toll on the fixed Canadian dollar incomes of snowbirds. To the extent that you may have chosen to adopt a commitment to a long-term retirement lifestyle in the U.S., so too should you choose to adopt a similar commitment to your investment income and portfolio management approach.

You should look to diversify your investment and retirement portfolios to include assets that produce U.S. dollar income. This is an excellent way to hedge for future U.S. dollar requirements. Investments that generate U.S. dollars could allow you to pay for some of your expenses each year without ever having to exchange Canadian dollars.