Pounds might be valuable in the United Kingdom, but they won't be easy to spend once you leave. You'll need to exchange your pounds for dollars before spending them in the United States. Find out what your pounds are worth by checking exchange rates before you look for someplace to make the trade. This way, you know whether or not the exchange rate you are offered are a good deal.
Exchange at the Airport
Exchanging the money at the airport is convenient. You'll likely walk by several kiosks waiting to exchange your money. The problem is that you will pay a premium for their convenience. For example, Travelex has locations at airports all over the world. It has a best rate guarantee, but only if you buy dollars online, not in-store. Travelex explains that those rates are higher than what you may see on the news or online as live rates, because you are paying the "tourist rate."
Exchange at a Bank
Most banks will exchange your pounds for dollars at a reasonable rate. In the U.S., you can expect a rate that is close to the current market rate you see online and in the news. The difference in the price you pay and the market price is the markup. The bank could also charge a flat transaction fee. Check the exchange rates yourself and go to the bank armed with knowledge. Compare the rates local banks are offering by checking their websites ahead of time.
Buy Dollars Online
Depending on your situation, you could have the option of buying dollars online. Many companies offer this service, including Travelex, Thomas Cook, the Post Office in the United Kingdom, and banks in both countries. Unless you are exchanging a large amount of money -- 500 pounds or more -- you will have to pay for delivery. Also, most of these options are set up for paying for your dollars with a card, not cash.
Use Your Card
If you bank internationally, often the least expensive way to get the local currency is to use an automatic teller machine to withdraw it your account. While you will likely pay a fee for this, you might get a competitive exchange rate. Check with your bank in advance to see if this will be a cost-effective option for you. Another option is to simply pay with your credit card. This can be convenient and offer the most competitive exchange rates. Depending on the terms of your credit card, the transaction fee may be minimal or nonexistent.
Sara Mahuron specializes in adult/higher education, parenting, budget travel and personal finance. She earned an M.S. in adult/organizational learning and leadership, as well as an Ed.S. in educational leadership, both from the University of Idaho. Mahuron also holds a B.S. in psychology and a B.A. in international studies-business and economics.