Last updated: Jun-19-2018

6/20/2018 2:01:45 AM
Show Printable Version Download Plain Text
Wealth Builder
Gordon Pape writes on common-sense wealth-building strategies.

By Gordon Pape  | Wednesday, April 05, 2017

Q – You have previously recommended holding cash reserves in U.S. dollars. Do you recommend any particular vehicles to hold this cash, such as money market funds, savings accounts, etc.? – Don M.

A – Unfortunately, you aren’t going to earn much interest on U.S. cash (or on any cash for that matter). My recommendation was based on my expectation that the loonie will decline in value against the greenback this year, which would give you a capital gain on any U.S. cash you hold. (Of course, if the loonie rises, you’ll lose.)

All the big banks offer U.S. dollar accounts, and some come with a variety of bells and whistles, such as a U.S. currency credit card, cheques, favourable exchange rates, etc. What they don’t offer is respectable interest rates. For example, you would have to deposit at least US$25,000 with TD Bank in order to earn a miserly 0.10%. If you have over US$100,000 you can earn 0.25% with HSBC.

A good U.S. dollar money market fund may offer a better return. For instance, the CIBC U.S. Dollar Money Market Fund returned 0.7% over the year to Feb. 28. The average for the category over that time was 0.3%.

You can find better rates with some smaller U.S. banks; however, they may require a U.S. address. You can search for details at – Gordon Pape

Gordon Pape is one of Canada’s best-known personal finance commentators and investment experts. He is the publisher of The Internet Wealth Builder and The Income Investornewsletter, which are available through the Building Wealth website.

Follow Gordon Pape on Twitter at and on Facebook at

Notes and Disclaimer

© 2017 by The Fund Library. All rights reserved.

The foregoing is for general information purposes only and is the opinion of the writer. Securities mentioned carry risk of loss, and no guarantee of performance is made or implied. This information is not intended to provide specific personalized advice including, without limitation, investment, financial, legal, accounting, or tax advice. Always seek advice from your own financial advisor before making investment decisions.

Find a Stock

(Leave blank for all)
Symbol   Name
Forgot your password?
Register now
Tech Support
For general inquiries, please email the Librarian.
Home |  Features |  Member Services |  Tools |  Funds |  About Us
For any questions or problems with this site, please contact the Librarian.
Page ID: 20:80:1047:00016176:9/12/2017:4:10:55 PM Duration of this visit: 0 sec.