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5 Ways to Travel with a Weak Canadian Dollar

Although it’s starting to make a comeback, the loonie’s weak value against its American counterpart in recent months has Canadians re-evaluating whether their neighbour to the south is an economically wise travel destination, despite its proximity. With this in mind, we’ve put together a list of five frugal ways for Canadians to travel and still get great value.

1. Go Against the Grain

Pick destinations where the exchange rate works in your favour. This will get you some excellent alternatives to the typical vacation spots that people tend to go for. The idea isn’t just about travelling to countries that are generally recognized as cheap places to go, but also about finding places where you’ll be able to stretch your Canadian dollars even further as a result of current economic conditions.

Take Brazil as an example. The Brazilian real has been steadily declining for the past few years and with the 2016 Olympic Games right around the corner, plenty of hotels have been built in Rio de Janeiro in anticipation of the incoming influx of tourists. The rates are extremely competitive, and this gives you more affordable options to choose from.

Poland is another alternative, being one of the few European countries that do not have the euro as their currency. The government, however, is considering making the switch from the Polish zloty to the euro soon, which will make a visit to Poland much less affordable as the cost of living will increase.

Iceland is set to become a top travel destination for Canadians, as airline companies WOW Air and Icelandair are beginning to offer more flights from several major Canadian cities to Reykjavik. This May, WOW Air will launch service from Toronto and Montreal to the capital city, and one way flights are expected to cost as low as $99.

2. Points, points, points

There is a silver lining to a dwindling Canadian dollar compared to the U.S. dollar: the value of your travel rewards is inflated. Even though it’s becoming more expensive for Canadians to go to countries where the loonie’s value is falling, the amount of travel rewards points needed to redeem a flight or a hotel booking remains the same. This results in your travel points being worth more when redeemed in countries with more expensive currencies than ours.

Let’s use the value of Air Miles, one of the most popular credit card rewards programs, as an example. You need at least 1,700 Air Miles reward miles to redeem a round-trip flight in economy class between Toronto and New York City in mid-March. A round-trip economy class ticket for an Air Canada flight from Toronto to this same location costs around US$195. Let’s say that the exchange rate is 0.90 (that is, one Canadian dollar is worth US$0.90); the cost of the flight would be $216.67, giving each reward mile a value of 12.745 cents. But what happens if the loonie’s value were to suddenly drop to US$0.50? The flight’s cost would rise by more than $170 to $390, and each reward mile required to redeem this flight would now be worth 22.941 cents. Although changes this drastic aren’t likely to happen, this example illustrates what happens to the value of your travel rewards points on a smaller, more realistic scale. Check out the infographic below on 5 Rules for Redeeming Your Air Miles.

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This also happens to be the case with several different loyalty programs, where the amount of points or miles required to redeem a reward stays the same, regardless of fluctuations in the values of currencies. Be sure to take advantage of this when you book your next flight or hotel room!

Compare all travel rewards programs

Find the best travel rewards credit card for you and apply in a few easy steps online!

3. Explore Canada

Travelling in Canada is often taken for granted. We’re lucky to live in a country that’s as vast and as geographically diverse as ours. Instead of worrying about how to make the most of your vacation abroad with a weak dollar, consider staying within our borders where that fact has no bearing.

With 38 national parks and countless provincial parks, this country offers landscapes of every type. In Calgary alone, driving an hour west will take you to the scenic Canadian Rockies, while an hour’s worth of driving in the opposite direction will get you to the badlands of Alberta, where you can see one of the largest dinosaur museums in the world.

Although the size of our country might present a challenge in getting to some of these attractions, it also presents the opportunity to travel in a few different ways that are likely to make the journey as much a part of the vacation as the destination itself.

4. Not planes, but trains and automobiles

If you end up deciding to vacation domestically, or even cross over to the U.S. to take advantage of your now more valuable travel points, consider alternative transportation methods before booking your flight. Weighing out your options can not only save you a fair bit of money, but can also contribute to the overall vacation experience in a major way.

There are far too many people who view flying as a means to an end, which has no other redeeming qualities besides how quickly it gets them to their destination. Whether it’s baggage weight requirements, the chance of it getting lost, flights getting delayed, or their schedules changing at a moment’s notice, the list of inconveniences and potential complications is endless. If you’re not in any hurry, taking a road trip addresses many of these flight-related issues, and provides you with the ease of making your own schedule and proceeding at your own pace.

Depending on your destination, it might be more economical for you to drive there, rather than fly. The loonie’s current state is largely caused by falling oil prices, which have also resulted in decreased gas costs. This effect is even more pronounced south of the border, where gas prices have hit 7-year lows. All this is to say that it’s quite possible that driving will cost you much less than flying, especially if you’re splitting the cost of gas with your friends.

5. Staycation

What’s the best way to avoid the exhaustion from travelling while also keeping transportation costs to a minimum? Don’t travel at all.

This isn’t to say don’t leave your house. But at a time when everything is so easily accessible, we tend to forget about what’s right in front of us. Locally sourced fun can be just as rewarding as an escape to the tropics, and much kinder to your wallet.

If you still want to feel like you’re on vacation, you can book an Airbnb or a hotel room for a change of scenery, then go to a museum, catch a baseball game, or go to a drive-in theatre or concert—with all the extra cash you’ve saved, you can probably do them all!

Flickr: KMR Photography