TORONTO, ONTARIO--(Marketwire - Sept. 22, 2012) - It's the first day of fall, a season in which many Canadians will bid goodbye to summer by saying hello to Florida, New York, Mexico and France.
BMO recently released a study indicating 54 per cent of Canadians plan to travel this fall. Of those, almost a third (29 per cent) will be headed out of country.
Increased outbound travel by Canadians has been a growing trend over the past few years. At the end of June, outbound travel, since January 2012, had increased 5.2 per cent over the same period last year, reaching almost 16 million overnight trips. Almost two thirds of all outbound trips are to the United States; in fact, stateside travel increased 8.9 per cent in June.
According to BMO Economics, the high June travel numbers to the United States, in part, reflected pent up demand, as Canadians awaited the higher duty-free limits introduced at the beginning of the month. However, this increase is also part of a protracted trend that began several years ago. More than 30 million Canadian outbound trips were made in 2011, which reflects an increase of 5.1 per cent from the previous year.
Canada has also experienced slight but steady increases in inbound travel since the lows of 2008-2009, but the number of visits and tourism dollars being spent in the country are not enough to offset Canada's growing international travel account deficit - payments by Canadian travellers abroad vs. receipts from foreign travellers in Canada - which reached $16.25 billion at the end of 2011.
"Tourism generated about $31 billion for the Canadian economy in 2011, or nearly 2 per cent of GDP, and about 4 per cent of the labour market has a direct link to the tourism industry," said Robert Kavcic, Economist, BMO Capital Markets. "If the growing trend in outbound travel continues, it will certainly put pressure on Canada's domestic tourism industry."
BMO's 2012 Fall Travel Survey indicated:
- Credit cards and cash remain the preferred methods of paying for fall travel (55 per cent and 52 per cent respectively).
- 42 per cent of Canadians who plan to travel this fall say they'll spend less than $1,000. This compares to 35 per cent of Canadians who said they'd spend less than $1000 on summer travel.
- Almost 80 per cent of survey respondents said they collect rewards; approximately 60 per cent of collectors travelling this fall said they will use their rewards to lower travel costs.
- Flights are the most popular rewards redemption choice (19 per cent), followed by hotels (15 per cent) and gas (11 per cent).
"Although a growing number of Canadians have been bitten by the international travel bug, they haven't lost their focus on affordability," said Su McVey, Vice President, BMO Bank of Montreal. "We continue to see savvy loyalty rewards collectors use their rewards to upgrade their travel experience or substantially offset their travel costs, especially through non-traditional features such as travel medical insurance; trip interruption and trip cancellation insurance; rental car damage waiver insurance; and through free access to VIP airport lounges; all of which help reduce the cost and worry of out-of-country travel."
BMO 2012 Fall Travel Survey: Top U.S. and International Destinations
|Top U.S. Destinations
|Top International Destinations
|EUROPE (UNSPECIFIED COUNTRY)
Regional breakdowns available upon request.
BMO's 2012 Fall Travel Survey was conducted from August 13-15, 2012, by Leger Marketing. The sample was 1524 Canadians, 18 years or older. The margin of error is 2.5 per cent.
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.
It's a good idea to take a mix of local currency, a debit card and a credit card with you when you travel out of country to ensure you can pay for purchases and services in the manner preferred or prescribed by the local merchants. Each has their own advantages:
• 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 product, 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 collision damage waivers, which can add up to substantial savings for travellers.
• Some bank plans with unlimited transactions allow for domestic and international debit card transactions at no additional cost, so check your banking plan. For a low monthly fee, BMO's Performance Plan allows unlimited transactions internationally over the Maestro network, as well as withdrawals from BMO Harris ATMs in the United States.
Foreign exchange notes (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; it isn't safe to carry large amounts of cash, and if it is lost or stolen, it is gone.
Get More Out of Your Travel Dollars by Getting More Out of Your Travel Rewards Program
Loyalty programs are the number-one determinant behind consumers' choice of a credit card. Here are a few tips to help collectors stretch their vacation travel dollars and get there sooner.
- Redeem points to offset your vacation costs. If you have a flexible program like the BMO Rewards or the AIR MILES Reward Program, you can redeem reward currency for flights, cruises and other package holidays, train travel, gas, hotels, restaurant gift cards, passes to local attractions and more. Plus, with BMO Rewards, if you don't have enough points to redeem for your trip, you can use what you have and then "top-up" with cash - for any amount.
- Use the travel insurance features of your credit card. Certain premium cards like the BMO Rewards World Elite MasterCard and BMO AIR MILES World MasterCard provide travel insurance features, such as trip interruption and/or cancellation insurance, travel medical insurance, rental car collision waivers and other benefits, such as airport VIP lounge passes. These benefits can substantially reduce travel costs. So, know and use your card features and benefits, and when in doubt call your bank's contact centre or check online for confirmation.
- Shop and compare to ensure you select a credit card with a robust rewards program. Look at the redemption ratio (what the points are actually worth) and the flexibility of the program - does it offer travel, merchandise, cash back, financial products and charitable donation options?
- Stick to one loyalty program. Consolidate all of your purchases on a single card so that you can accumulate rewards faster and reach your goal sooner. Doing this also makes it easier to track and monitor your spending.
- Capture your entire spend. Does your loyalty program reward you for all of your day-to-day spending? Make sure you earn rewards on even minor purchases such as coffee, fast food, or convenience store items. Consider using PayPass for smaller-value purchases. It is fast, convenient and allows you to collect rewards. For purchases under $50, you simply tap the PayPass enabled card or Mobile PayPass tag on your mobile device to the PayPass reader, and go. No personal identification number, swipe or signature is required.
- Triple Your Rewards. Make a triple play and earn rewards three times faster by:
- using a loyalty rewards credit card whenever you purchase goods or services
- purchasing those goods and services from merchants who participate in the same rewards program that is affiliated with your credit card
- timing your purchases to take advantage of special in-store or online bonus rewards offers.