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Money Saving Guide for Canadian Snowbirds

money saving guide for Canadian snowbirdsOften referred to as Canadian snowbirds (not the jets!), are an increasingly large group of Canadians who temporarily flock to the myriad of warmer American states to escape Canada’s harsh winters. Who wouldn’t want to bask in the Floridian or Arizona sun instead of shoveling their driveway in -20 degree weather? However, snowbirds need to consider the number of different issues that they face for residing in the United States. Luckily, this guide will address these issues and what you need to do to ensure that your stay is as pleasant as possible.


As a Canadian who temporarily resides in the United States or anywhere abroad, it is crucial that you are aware of your tax obligations.  If you reside temporarily in the United States but continue to maintain significant residential ties to Canada such as the ownership of a home, spouse or have any other significant monetary asset, you will most likely be deemed as a factual resident for tax purposes by the Canada Revenue Agency.  This means that you will be taxed as if you had continued to live in Canada so ensure that you file your personal tax return.  If you receive non-Canadian source income you will also need to report it.

If you spend more than 182 full days over a three year period under the Internal Revenue Service’s‘substantial presence test’ then you may be treated as a resident for US tax purposes.  To avoid this, ensure that you do not spend more than 182 full days in the United States within a three year period.  In cases where you do end up staying past this threshold, you can file ‘Form 8840 Closer Connection Exception Statement for Aliens” which will exempt you from paying US taxes.

money saving guide for Canadian snowbirdsCurrency Exchange

With the looming decline of the Canadian dollar, snowbirds should look to save as much money as possible when converting Canadian dollars to American or vice versa.  Most people look to transact their currency exchange at their respective financial institution.  What they do not realize is that most banks mark up their exchange rates.  Instead it is much better to transact with a currency exchange service.  In most cases, they will be able to provide you with much better rates.  If you’re transacting a large sum of money, this can result in thousands of dollars in savings.  Buying currency in bulk and when the Canadian dollar is strong can safeguard you from any future drops.  You might also want to take a look at our specialized snowbird currency exchange service where we provide preferential exchange rates.

Credit cards might also be an alternative if you’re looking to do some foreign transactions while you’re down in the United States.  However make sure that you don’t use your bank’s credit card since they charge you a 2.5% foreign transaction fee.  Instead find a credit card that has no foreign transaction fee and can provide you with cash back on eligible purchases.  To see a list of Canadian credit cards with no foreign transaction fees, take a look at our article on the best credit cards for foreign currency exchange.

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Healthcare Retention and Travel Insurance

Depending on the province, provincial health care benefits are only accessible as long as the resident maintains residency in that province for a certain number of days.  In Ontario, the minimum limit to qualify is 153 days.  In most cases, your provincial healthcare plan is not very comprehensive and will only provide partial coverage.  So it is vital that Snowbirds also have adequate travel health insurance in cases of emergency.

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By Admin | January 14, 2016 | Uncategorized | 2 comments