Inflation has added a wrinkle to the busiest shopping day of the year.
With soaring prices, finding discounts is top of mind for all shoppers. For Canadians who live within an easy drive of the United States, it’s hard to resist crossing the border in search of the best deals.
While visits by car were still down from pre-pandemic levels this spring, according to RBC Economics, it’s likely that the number of Canadians shopping on Black Friday in the U.S. will be higher this year than the previous two.
“It’s an exciting time,” says Danielle DeMartin, Regional Advisor, U.S. Cross Border Banking at RBC. “We are seeing the number of Canadians making day-trips to the United States slowly increasing as travel restrictions continue to lift. According to Stats Canada, which tracks the number of Canadians returning by car from the US each month, we’re well on our way to seeing the numbers get back up to pre-pandemic levels.”
Thinking of heading south to take advantage of Black Friday deals? Here are a few ways to make your trip financially painless.
Research personal allowances and duty-free rules
Before you plan your trip across the border, make sure you know the dollar value of goods you can bring home.
“Often shoppers aren’t aware that personal allowances are based on their time away,” DeMartin says. “There’s no personal exemption for day trips.”
You must stay 24 hours to have a $200 allowance — not including tobacco or alcohol products. After 48 hours, you can claim purchases worth up to $800 Canadian, including specified amounts of alcohol and tobacco.
To estimate the duty and taxes on specific purchases, use the estimator on the Canada Border Services Agency website. And, always hang on to your receipts.
Do the math
Make sure you do enough research before your trip. Sometimes a deal sounds perfect, but once you factor in the exchange, duty and cost of travel, it might not be so much of a bargain.
“If you’re planning to drive across the border, one expense that often gets overlooked is the cost of filling up your gas tank,” DeMartin adds. “If you don’t live near the Canada-U.S. border, it could greatly impact the overall cost of Black Friday or any U.S. shopping trip.”
It’s also important to plan what you want to spend ahead of time and make sure you stick to your budget.
Get a U.S.-based credit card
A U.S.-based credit card can help you save on expensive foreign transaction fees, which can cost you up to 2.5 per cent on your U.S. purchases.
“Many Canadians get a U.S.-based credit card in order to save on foreign transaction fees, but that’s just one of many benefits. Depending on who you bank with, you can also earn rewards points, pay recurring U.S. bill payments, start to build a U.S. credit score, or even time your U.S. dollar purchases online to when the exchange rate is more favourable,” DeMartin says.
RBC’s Foreign Transaction Fee Savings Calculator can show you just how much you could save when using a U.S-based credit card.
Open a U.S.-based bank account
If you travel regularly to the U.S., whether that’s to work, travel, or shop, having a U.S.-based bank account will save you time and money, DeMartin says.
“There’s no need to go to an ATM or bank branch for U.S. cash before you leave and there’s no need to worry about the additional fees that are often associated with accessing money through your Canadian account.”
Not only can fees add up when using a Canadian credit card or debit card in the U.S., which incur foreign exchange fees every time you make a purchase or withdraw cash from an ATM, you may also find that your Canadian credit card is not accepted everywhere, like paying for gas at the pump. With RBC Bank (U.S.) there is also the opportunity for cash back, which is available at most large retailers using your U.S. Visa debit card.
Learn more about managing your finances when travelling to the U.S. by visiting rbcbank.com.
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