Here's a question for the Canadians, or those who follow the US-Canada exchange rate, or have views about the long-term relative value of the US and Canadian dollars.
I've reached financial independence and am planning to retire in 2015. Part of my post-retirement plan is to spend up to six months per year in beautiful Canada (up to the legal maximum for a US citizen without a Canadian work visa or resident status). My husband and I have a cottage in Canada that we bought when the Canadian dollar cost about US$.85. Since then, we've seen the Canadian dollar rise as high as US$1.12, and now, with oil prices low, it is falling again. It is currently at about US$.88.
I'm wondering how much of my cash stash I should move to Canada, and on what kind of time table.
I have about CAD30K there now in a credit union money market account paying 1%. In addition to a diversified portfolio, I have about USD100K that is a cash cushion (money that I don't want to invest in equities, bonds, or real estate, plus additional cash that I'm keeping on the sidelines for investing should stocks go on sale). Should I move more of my $100K cash cushion to Canada, assuming that I will eventually spend this money there over the coming years and so should take advantage of the current exchange rate favoring the USD? Or should I follow the exchange rates and move money gradually over the months (in a dollar-cost-averaging sort of way)? Is there anything else I should be considering?
Thank you!