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To mark Financial Literacy Month, BMO Financial Group is releasing a series of financial tips throughout November. As part of BMO's commitment to 'Making Money Make Sense', the tips are designed to help individuals and families save and manage their day-to-day finances more effectively.
BMO's Tip of the Day: Using a combination of a credit card, debit card and cash will give you convenience, security and flexibility when you travel or shop in the United States.
More Canadians than ever are expected to flock to the U.S. this winter. If you plan to travel to the U.S. or anywhere outside Canada, here are three simple criteria to help you decide what combination of cash and cards you need to carry in your wallet:
-- Access - Ensure you have easy and immediate access to emergency funds if
you need them. Can you use your debit card to make purchases or access
your bank account from anywhere in the U.S.?
-- Safety - Are your funds and purchases protected against theft or loss?
-- Convenience - Research if you can convert your Canadian currency to U.S.
dollars if needed. Find out if your credit card is widely accepted.
Su McVey, Vice President, BMO Bank of Montreal suggested: "Carrying a combination of all three payment options - cash in local currency; a widely recognized and accepted credit card that offers some form of purchase protection; and a debit card that gives you access to your Canadian bank account from local ATMs and Points of Sale terminals - will provide you with the highest degree of convenience, security and payment flexibility when you're travelling outside of Canada."
Credit Cards: Credit cards remain the most popular way to pay among Canadian travellers. In addition to world-wide merchant acceptance, many credit cards offer loyalty rewards, insurance against loss or theft of purchased products, extended warranties and zero liability in cases of fraud. Some cards, such as the BMO Rewards World Elite MasterCard, also include travel medical coverage, trip cancellation/delay insurance, and car rental collision damage waivers, which can add up to substantial savings for travellers. If travel insurance features are not built into your credit card, they can often be added on an as-needed basis at a competitive cost.
Debit Cards: Some bank plans with unlimited transactions allow for domestic and international debit card transactions at no additional cost, so check your banking balance. For a low monthly fee, BMO's Performance Plan allows unlimited transactions internationally over the Maestro network, as well as withdrawals from BMO Private Bank in the United States.
Local currency (cash): Have a small amount of local currency on hand so that you can pay for incidentals such as the cab ride from the airport and tips. But don't take too much; if it is lost or stolen, it is gone. BMO branches usually have U.S. dollars available, as do many BMO ATMs - particularly those in cities and towns that border the U.S.
"CFEE commends BMO's ongoing efforts to support Financial Literacy in Canada and promote ways in which Canadians can increase their competence and confidence when managing their personal finances on a day-to-day basis," said Gary Rabbior, President, Canadian Foundation for Economic Education (CFEE).
BMO Financial Literacy Month Tips
November 1: Maximizing TFSA investments annually over 20 years can save nearly $30,000 in taxes.
November 2: Utilize rewards to squeeze the most value out of every dollar you spend this holiday season.
November 3: Choose an investment advisor who is right for you and will help you meet your financial goals.
November 4: Use your RRSP to help make the down payment on your first home.
November 5: Space out payments to avoid cash-flow problems.
November 6: Take advantage of the benefits of preferred shares.
November 7: Consider investing in a Registered Retirement Savings Plan (RRSP) and taking advantage of tax incentives when saving for retirement.
November 8: Take advantage of Canada's numerous online personal finance resources.
November 9: Before you head off on your winter vacation, be sure you and your family are properly covered in the event of a medical emergency.
November 10: Understand what you can hold in your RRSP.
November 11: Stick to the one-third rule when planning the purchase of a home.
November 12: Secure your retirement by opening a Registered Retirement Savings Plan (RRSP) as early as possible and contribute to it on a regular basis.
November 13: As couples prepare for their wedding day, they should have "The Financial Talk" to help the transition from "my money" to "our money."
For more on financial literacy, Canadians can visit the Government of Canada's Financial Literacy Month website, as well as BMO's Financial Literacy online resource.
About BMO Financial Group
Established in 1817 as Bank of Montreal, BMO Financial Group is a highly diversified North American financial services organization. With total assets of $542 billion as at July 31, 2012, and more than 46,000 employees, BMO Financial Group provides a broad range of retail banking, wealth management and investment banking products and solutions.
Carol Greene, Toronto
Valerie Doucet, Montreal
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