Hello,
We have put aside some cash over the past year for our trip to London. I am wondering if it is better to exchange the dollars to pounds or if it is more economical to use a charge card and pay it off with the cash once we return?
Thanks,
John K
Given it will cost you to exchange currencies and the fact that you will need only a small amount of £s when you are in there I would recommend you leave your $s at home and use your cards predominantly.
Almost all places in the UK will take credit cards, and they will have the better exchange rate. There will rarely be a need for cash, unless you are tipping, which isn't as common as in the US. It isn't a bad idea to have a small amount of £s just in case. However exchanging US $ cash for €s is the most expensive way of doing it. Put that cash into your bank and use your ATM or debit card to withdraw a small amount at a bank ATM when you get to the UK. Or, if your bank will sell you £s at a half decent exchange rate, you could do it before you leave home.
I'd go with cash for day-to-day expenses and credit for large purchases; mid-size expenses can go either way. If you have an account with a large U.S. bank, it likely offers currency services and British pounds are always available. They might not charge you to change currency if your account has a certain value in deposits. Last year, I traveled overseas twice and got some local currency, but did not pay one penny in fees. I always get some local currency regardless -- partly because the simple task of changing currency gets me pumped up for a trip. With charge cards, however, the situation depends on several factors: Some charge cards assess fees, others don't, depending on policy, card type, credit rating, borrowing capacity and so on. I have had a charge card with a prominent bank for some 25 years and an excellent credit rating: I noticed on my most recent trip that it assessed fees, something it had never done before in decades of travel. The issuing bank changed its policy. Call your charge card company to find out and talk to the operator. They'll also send you a link or document that explains fees.
One of the least expensive ways for you to get cash is to wait until you’re in London and use a debit card at a bank ATM to withdraw cash.
Exchanging dollars for pounds in London will be pricey because the exchange rate is usually guaranteed to clip you. And ordering pounds through your bank will also come with high fees.
No, don’t exchange currency. Fees are atrocious. We like to land with a little currency but anymore banks here won’t sell you a little bit. You can check with yours and if you can buy 50 pounds do it. The fees are inconsequential for that small a transaction. And you really don’t need cash even for day to day expenses, except if you buy a newspaper at a stand, things like that. Everything is tap your card to pay. Make sure your credit card has no international transaction fees and let the bank know you are traveling. Take another one in case you lose the first one. Leave the money you saved at home.
I like to use my cards because I get points for the purchases so it is a win-win for me, but some people don't do that with their cards.
If you are asking about whether or not you will NEED £'s while you are there, here is MY personal experience:
Having just left London/England in the last 3 weeks, I will say, we took $250 cash that we had converted months before here into ££'s to use for tips in our room/at cash only spaces. We came back, after 17 days with over £150 so I recommend only getting it in small bills from your bank (if they have a good exchange rate, which mine does) and plan to use that for the tips you know you will use and maybe £20-30 over that for any incidentals that don't accept cards. I would also get it in small bills/coins if you can. Our bank gave us an asst from £20-5's so we had to "break" them for smaller coins and bills at various spots.
Use your debit or credit card. Hopefully one without foreign transaction fees. If given a choice, always select GBP, British Pounds. Do not select USD
You will find most places accept your contactless card or Apple Pay/Google Wallet for payment. Some places will not take cash at all. Even for a purchase under 1 GBP.
If you need or want cash, use your debit card to withdraw a minimal amount at a bank owned ATM. In March I only used cash at a self service laundromat and a church collection plate.
Are there street vendors in London who only take cash? I was thinking that buying a bottle of cold water as needed or using a paid WC would require coins. If that's the case we certainly wouldn't need more than 10-15 GBP, correct?
Credit cards will be used for all other expenses.
Addendum to the above post.
Looked in my change collected from a previous trip to the UK and discovered a 2 pound, 1 pound and assorted other coins to total 4 pounds 40 pence. Would that suffice for incidentals?
If you are just staying in London you can almost certainly get away with no cash at all. You may come across traders who will only accept cash, but it will be unusual and there will almost certainly be other places to get what you want. If you are planning to travel outside London there are more places that will be cash only but again if you're going to main tourist destinations you should be fine. £4+ in cash is barely worth bringing, there will be precious little you can buy with that.
"Are there street vendors in London who only take cash? I was thinking that buying a bottle of cold water as needed'
They all take card.
In this day and age, even market traders have card terminals (and some don't take cash). As noted £4 won't get you much anyway.
If you want a bottle of water, don't buy it from a street trader, go to one of the many smaller branches of the major supermarkets, Tesco Express, Sainsburys, Morrisons, Co Op for example they will be cheaper. Same with Superdrug or pound shops such as Poundland.
If you are near an Aldi or Lidl, they are very cheap to buy a 12 x 500ml pack of water. Ideal for your room.
The story I always like to tell when this topic comes up is two years ago when I was in England and was using a 20-pound note to pay for something, the poor young lad behind the counter was so terrified of making change that he had to go get his manager. I found that cash simply isn't used there these days, no matter in London or in more rural areas. As someone else said, all you need is a good credit card with no international fees. As long as you have that, leave your cash at home.
