Finance

For travel-loving Canadians, other financial goals take a back seat to vacation spending

Published

11 months ago

June 1, 2025

For travel-loving Canadians, other financial goals take a back seat to vacation spending

Liza Akhvledziani Carew and her husband David Carew visited Kenya’s Masai Mara National Reserve on their honeymoon. The couple strategically use credit card points to help pay for their travel.Supplied

Driving through rolling savannah plains in Kenya’s Maasai Mara National Reserve on her honeymoon, Liza Akhvledziani Carew saw elephants, lions and giraffes. She was reminded of the sheer vastness of the world and felt her “own little life” put into context.

For Ms. Akhvledziani Carew, the chief executive officer of a startup that helps Canadians earn more credit card points, travel is a non-negotiable budget item.

“It’s a big part of our lifestyle. That’s probably what I would spend most of my money on,” she said, adding that the couple pays for part of their travel with a “sophisticated [credit card reward] points strategy.”

The cost of travelling has soared in recent years, driven by the postpandemic travel boom, inflation and new taxes imposed by destinations affected by overtourism.

But for many Canadians, travel remains a high-priority spending area, regardless of rising costs. And it’s clashing with other financial goals.

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Kathleen Daunt, a financial adviser with the New School of Finance in Toronto, works with clients who are saving for a major financial milestone, most commonly to buy a home.

When she sits down with her clients and calculates the amount they’d need to save each month to reach that goal – which usually means not spending on travel – they balk at the trade-off.

“People expect to have all the items on their list of priorities. If anything, it means you have to understand your priorities and have flexibility,” she said.

She also said roughly two in five new clients will cite annual travel as one of their top financial goals.

Ms. Daunt said she sees the desire for travel as a mix of social media-induced fear of missing out, widespread burnout and a societal view of vacations as a right – all of which can make it easier to justify overspending.

“You have that same old expectation [of being able to take vacations] but everything just feels more pricey,” she said. “It’s so much money for a family of four or more to do an on-a-plane vacation.”

Canadians’ overseas trips were up 32 per cent in the July-to-September period last year from the same period a year earlier, and up 6.5 per cent from 2019, according to Statistics Canada’s most recent national travel survey. The amount they spent abroad also jumped, rising 20 per cent in 2024 from a year earlier and nearly 40 per cent from 2019.

Tourism operators anticipate a strong summer as more Canadians avoid U.S. travel

Even the trade war with the United States and growing possibility of a recession have not dimmed Canadians’ vacation ambitions. While travel south of the border by plane and car is down, Transat A.T. Inc. chief executive officer Annick Guerard said on a conference call with analysts in March that Canadians’ spending on transatlantic flights has not been affected.

According to estimates by Barry Choi, a personal finance and travel expert at moneywehave.com and regular Globe and Mail contributor, a two-week European vacation costs about US$5,050 ($7,000), though he noted the estimate was for a solo traveller, so couples or families should expect to pay notably more. Timing can significantly affect costs, with June to August the most expensive months.

In contrast, according to the Canada Mortgage and Housing Corp., Canadians’ average monthly mortgage payment at the end of 2024 was $2,042 (and much higher in Toronto, at $3,006, and Vancouver, at $3,053).

Rachel Dodds, a professor at Toronto Metropolitan University’s Ted Rogers School of Hospitality and Tourism Management who studies overtourism and consumer motivations for travel, said social media plays a huge role in stoking travel interest. According to data from TikTok, as of mid-2024 the app had seen a 410-per-cent increase in travel content views since 2021.

“Everyone has a phone, everyone consumes [travel content] – if you see a reel on Instagram you’re like, ‘Oh, I wanna go there,’” Prof. Dodds said. That goes both ways: While on vacation, people are much more likely to post photos for the “instant gratification” of likes and comments. “There’s an emotional and sharing aspect of it that didn’t exist before 15 years ago.”

Relative to previous decades, travelling is now more affordable and is seen as a right rather than a privilege in Western countries, Prof. Dodds said. And that increase in affordability has come at a time when many people, particularly millennials and Gen Zers, have more disposable income but feel other large financial goals are out of reach.

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“Travel has become a substitute for those kinds of things,” she said.

Prof. Dodds said we are an increasingly lonely society, and many people are travelling to connect with others to have meaningful, authentic experiences of other cultures. That’s given rise to sustainable travel, and nature-based trips and community experiences, rather than the traditional resort-based vacations.

While Ms. Daunt said none of her clients have ultimately chosen travelling over other financial goals, some have opted to delay major purchases. She said she usually sees people negotiating within their new budgets to downgrade from a trip every year to once every two or three years, or from pricier international trips to smaller ones close to home.

“It’s hard, because we have the push from feeling burnt out and I would argue expecting vacations. We live in a country where we feel like, ‘I deserve to be able to have vacations,’ and there’s this other push on the home-buying side where there’s so much FOMO when it comes to home purchasing despite a bonkers overpriced market,” she said. “We’re still putting those expectations on ourselves.”

A strategy of making small regular contributions to a dedicated travel savings account can be an effective way to save for vacations without compromising other travel goals, she said.

For Ms. Akhvledziani Carew’s part, when she and her husband bought their home a few years ago after years of rigorous monthly savings goals that mimicked what they expected to spend on mortgage payments.

They also tapped their investments, and her husband sold a condo he previously owned. She said they did slightly less-elaborate trips, but their points strategy meant they didn’t have to cut back much.

“It was a different position we were starting from,” she acknowledged, but added later “you build your lifestyle around the thing that’s most important to you.”

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Finance

Why this sleepy Swiss town has become a ‘bolt-hole’ for the Gulf elite

Published

7 hours ago

April 20, 2026

Press Room

Why this sleepy Swiss town has become a ‘bolt-hole’ for the Gulf elite

As conflict continues to destabilise the Middle East, the Gulf States elite are seeking solace in European alternatives that offer comparable financial benefits with a far lower risk of war on the doorstep. One such destination is the small Swiss town of Zug, which is becoming a “bolt-hole” for Gulf-based wealth, said the Financial Times.

‘Swiss Monaco’

Switzerland’s reputation as a magnet for the world’s financial elite is nothing new. In 2025, the country recorded the “densest concentration of millionaires” with an estimated 146 per 1,000 adults last year, said The Times. Now home to around 135,000 people, Zug’s canton – also named Zug – used to be the “poorest corner of Switzerland” until it lowered its tax rates in the 1950s. “Now it has corporate tax rates of 16.2% compared with 40% in the US and 33.3% in France.”

“In almost all ways Zug is unremarkable”, with its traditional Swiss architecture and cobbled waterfront lanes. But if its “Alpine lake water is clear”, the financial scene is more “murky”. Many credit Marc Rich and Pincus “Pinky” Green, founders of metals and minerals trading firm Glencore, with the transformation of Zug from a “Swiss backwater” to its status as the “Swiss Monaco”. The multinational is headquartered just outside Zug, and has made the town a “global powerhouse for trading crude and refined oil products”. It should be “no surprise” that the “1% of the world’s 1%” are taking shelter there, and at the same time, hoping to still “keep a hand in the oil business”.

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“Industry estimates suggest that tens of billions of dollars could flow into Switzerland depending on how the current conflict evolves,” said the Outbound Investment Group. The “immediate trigger” for the “surge in interest” from Gulf-based investors is the war in the Middle East. However, Switzerland’s underlying appeal is its unwavering “Swissness”: “political neutrality”, “strong legal frameworks”, and reputation for wealth preservation. It’s a safe bet with no sign of slowing.

‘Availability tightening’

There are some drawbacks, said the FT. For “would-be arrivals”, the appeal of the region for Middle Eastern residents comes with “practical constraints”. Those outside the EU “face a higher bar”. Usually, the condition of residency is “tied” to employment or company formation. For the “very wealthy”, there is the added option of “negotiated lump-sum taxation agreements with cantonal authorities” that allow individuals to “pay a flat annual tax based on living expenses rather than global income”.

Even if they are holders of EU passports, the “main bottleneck” is the availability of property. Competition is “intense” and “rental supply is extremely limited, with properties often snapped up within days”. With Zug’s “availability tightening”, other cantons in the region with similar tax arrangements could benefit, such as Lugano, an Italian-speaking city in the Ticino region.

The uncertainty of the duration of the conflict is one of the most pressing concerns, said Bloomberg. The recent breakdown of ceasefire talks risks “forcing a reckoning for the professional and expat classes considering options after putting down roots in the Middle East”.

The short-term benefits of physical safety from leaving the Gulf are clear, but changing tax residency “takes time” and practicalities such as finding schools and “conforming to national requirements such as opening local bank accounts” is often “complicated and time-consuming”. The region’s ultra-wealthy are facing “uncomfortable decisions on whether to make the move permanent, especially with the end of the school year in sight”.

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Finance

How much will Social Security go up next year? See latest forecast

Published

20 hours ago

April 20, 2026

Press Room

How much will Social Security go up next year? See latest forecast

Before Social Security payments are posted this week, many retirees are looking ahead at the potential Cost of Living Adjustment for 2027 with an advocacy group predicting a similar increase to 2026.

On April 10, The Senior Citizens League — a nongovernmental advocacy group for seniors — released its monthly COLA forecast for 2027, saying data showed a 2.8% increase is likely.

“Over the last seven weeks, crude oil prices have soared, and fuel prices have followed suit. Consumers are getting pinched at the pump as gas prices soar, while businesses are paying more for transportation and/or production costs. This energy price shock is beginning to show up in the monthly U.S. inflation report, and it’s having a tangible impact on 2027 COLA forecasts,” The Motley Fool, a financial and investing advice company, and USA TODAY content partner, reported on April 18.

The official announcement will come in October, as it’s based on third-quarter inflation data.

According to Consumer Price Index data published last week, the annual inflation rate reached a two-year high of 3.3%, up 0.9% over the last month. This is largely due to soaring oil prices caused by the war in Iran.

Social Security payments are always scheduled on Wednesdays, with the final wave of this month scheduled for April 22, according to the Social Security Administration. The schedule is based on the birth dates of the recipients — retired, disabled workers or survivors.

Here’s who will get a Social Security check this week and more on the 2027 COLA forecast:

When is the final Social Security in April 2026?

Social Security benefits are sent out based on the recipients’ birth dates. Wednesday, April 22, is the final wave of payments for those with birth dates between the 21st and the 31st of April.

What is the 2027 COLA forecast?

The 2027 COLA increase is forecast to be 2.8% due to continuing inflation prices, according to The Senior Citizens League’s April 10 press release. If the SSA approves that rate of increase, average payment for retired workers would go up by $56 per month in January 2027.

The SCL releases a COLA prediction each month based on the Consumer Price Index, Federal Reserve interest rate and the National Unemployment rate from the U.S. Bureau of Labor Statistics.

Beneficiaries who want to stay updated with the monthly predictions may visit the SCL’s “COLA Watch” webpage that includes the forecast, calculations, historical trends and more.

The official COLA increase for 2027 will be announced in October 2026.

What were the big Social Security changes in 2026?

At the beginning of 2026 recipients received a 2.8% COLA for Social Security and Supplemental Security Income (SSI) payments, according to the SSA’s COLA Fact Sheet and American Association of Retired Persons, increasing payments about $56 per month.

Here are more details on the 2026 COLA increase, per the SSA:

The maximum amount of earnings subject to the Social Security tax increased to $184,500.
The earnings limit for workers who are younger than full retirement age (67 years old) increased to $24,480. (There will be a $1 deduction for each $2 earned over $24,480.)
The earnings limit for people reaching their full retirement age in 2026 increased to $65,160. (There will be a $1 deduction for each $3 earned over $65,160, until the month the worker turns full retirement age.)
There is no limit on earnings for workers who are at full retirement age or older for the entire year.

What should I do if I don’t get my Social Security payment?

According to the SSA, if you don’t receive your payment on the scheduled date, wait three days additional days, then call their office.

Where are the Social Security offices in Michigan?

There are 48 offices in Michigan, and to find an office near you, recipients may use the office locator via the Social Security’s website by entering your zip code for office hours, numbers, available services and more.

How can I replace my Social Security card?

The personal account, “my Social Security” allows recipients to manage their personal records, including a request for a replacement Social Security card and benefit statements for taxes and more. New accounts are created using ID.me or Login.gov as a multifactor authentication.

When will I get my checks in May? Full 2026 schedule

USA TODAY Contributed

Contact Sarah Moore @ smoore@lsj.com

Finance

Hong Kong reasserts role as safe haven in global finance amid Iran conflict

Published

1 day ago

April 19, 2026

Press Room

Hong Kong reasserts role as safe haven in global finance amid Iran conflict

The US-Israeli war on Iran has unleashed sharp swings across global energy and financial markets, fuelling demand for safe-haven assets, with Hong Kong emerging as a potential beneficiary across gold, property and capital markets. In the third of a three-part series, we look at Hong Kong’s position as a stable base where demand for property has held firm despite the global turmoil.

The seven-week military conflict in the Middle East will redefine Hong Kong’s role as a global financial centre, positioning the city as a safe harbour for capital and investments.

Anecdotal evidence suggested that more banks had turned to Hong Kong to protect their businesses and committed themselves to expanding their presence in the city. At the same time, inquiries about adding allocations of mainland Chinese assets among global investors had recently increased, potentially enlarging the customer base for the city’s asset-management industry and family offices and driving demand for offshore yuan-linked financial products.

For years, Hong Kong’s status as a financial centre in the Asia-Pacific region has been challenged by Dubai, which has risen to prominence as a gateway linking Asia and Europe in capital flows, transport and logistics. With the war destabilising the Middle East – at one point forcing the closure of the Dubai International Airport and sending stocks in the Gulf region plunging – Hong Kong has re-emerged due to its geographical location, a pegged exchange rate, free capital flows and support from China’s economic strength.

“In that context, China and Hong Kong are attracting renewed attention,” said Gary Dugan, CEO of The Global CIO Office in Dubai, which advises family offices and ultra-high-net-worth individuals globally. “There is growing interest among some clients in increasing exposure to China and Hong Kong. It is less a simple flight to safety and more a reassessment of where investors see relative value, policy consistency and long-term strategic opportunity.”

Dubai now relies on trade, tourism and finance as the pillars of its economy, reflecting the success of its four-decade diversification away from oil for sustained growth. The United Arab Emirates city is home to Jebel Ali Free Zone, the biggest free-trade zone in the Middle East, and the second-largest stock market in the region, with combined market values of US$1.01 trillion. The city, also a global hub for gold trading, has a population of 4 million, about 80 per cent of which are foreign expatriates. Dubai’s economy grew by 4.7 per cent in the January-to-September period last year.