If you're traveling abroad this summer, or making a quick trip across the border to cash in on relaxed duty free limits, you're going to need to exchange your loonies for some Benjamins and that's going to cost you.
But not all currency exchange services are equal and the amount you pay at your bank, credit union, currency exchange kiosk or on your credit card can vary wildly.
It always pays to do your research. Here's how to keep more dollars in your pocket when traveling outside of Canada:
Avoid the airport and hotel currency exchange
You're jet lagged, laden with baggage and just want a euro for the vending machine. Sound familiar? If you must exchange cash at a hotel, train station or airport, be forewarned you're going to pay a premium. Transaction fees are usually much higher in exchange for convenience. The same applies for currency brokers in high-traffic, tourist-heavy areas.
Travelex, the world's largest non-bank provider of currency exchanges, typically charges a blanket fee of US$9.95 per transaction, according to CardHub. Comparatively, TD Bank charges US$7.50 while BMO Harris Bank has no fees for cash exchanges.
Load up on your credit card
Credit card companies generally charge the least in exchange fees, but it's smart spending to call your lender to determine exactly what those fees will be. Typically, credit cards from the big six Canadian banks charge 2.5 per cent for foreign transactions. Some credit cards, like Diners Club International and Desjardins charge even lower rates -- 2 per cent and 1.8 per cent respectively.
Instead of exchanging U.S. dollars for euros, loading up on credit card transactions can save consumers 8.1 per cent compared to bank conversion services and 16.2 per cent compared to independent brokers you'd find in an airport or train station, a recent survey from CardHub found.
And remember, avoid cash advances from your credit card unless you're in an emergency situation. The minute that cash hits your hand, the double-digit interest meter starts running.
Stick to your bank if you need cash
It's always wise to travel with some cash, but be sure when exchanging physical currency you stick to the bank where you're a client. Royal Bank of Canada, for example, will charge non-clients an extra $3 -- over and above transaction fees -- for the privilege of exchanging your funds.
Be careful of your debit card
If you're able to use your debit card abroad be sure you understand what the charges are before you make a purchase. Some financial institutions charge debit and cash withdrawal fees in addition to conversion rates. PC Financial charges a $3 withdrawal fee in addition to the 2.5 per cent currency conversion fee when used internationally.
Avoid dynamic currency conversion
When purchasing items abroad, be wary of merchants who offer to complete the transaction in Canadian dollars. With dynamic currency conversion, there are often hidden fees, exorbitant exchange rates and you will be double dinged by your credit card company for the international transaction. All of the extra fees and charges could amount to a 10 per cent premium on your purchase, just for the illusion of convenience. When in doubt, whip out your smartphone calculator to be sure you're not over charged or avoid dynamic currency exchange all together.