British money has a lengthy history, so it’s not surprising that it’s evolved and changed over the years. Whether you’re watching British TV, reading British books, or just planning a trip to the UK, it’s understandable you might have questions about how it works. Even among Brits, you’ll find many don’t understand the older British monetary system – shillings and farthings and whatnot.

The Modern British Monetary System: Pounds and Pence

We’ll start with the easy bit. In 1971, the British government converted the pound into a decimalised currency, which means it works very similarly to dollars and Euros. This did away with the shilling, making way for a system of pounds and pence (pennies). One pound sterling was declared equal to 100 pence.

Instead of the $ sign most of our readers are accustomed to, the pound’s symbol is £, and its ISO code (like USD, CAD, AUD, etc) is GBP.

The pound sterling is the official currency of the UK, Jersey, Guernsey, the Isle of Man, Gibraltar, South Georgia and the Sandwich Islands, Tristan de Cunha, and the British Antarctic Territory.

As a member of the EU, they could have opted to use the Euro, but they decided not to. That means that if you’re planning a trip that includes Ireland and the UK or the UK and mainland Europe, you’ll need to give thought to both currencies. Granted, it’s all much easier now that we have credit cards (many of which have no foreign transaction fees) – but for those situations where cash is essential, you’ll need both.

As of January 2020, 1 GBP is worth roughly:

• 1.31 USD
• 1.71 CAD
• 1.91 AUD
• 1.18 EUR

UPDATE: As of February 2023, 1 GBP is worth roughly:

• 1.20 USD
• 1.61 CAD
• 1.74 AUD
• 1.13 EUR

Historically, the pound sterling has been worth quite a bit more relative to the USD. Throughout much of the 1970s, a single pound would cost more than $2. During the early 2000s, £1 fluctuated between roughly $1.45 and $2. As recently as 2014, £1 was worth $1.70.

Luckily for those who enjoy travelling to the UK, the pound sterling has been weak in recent years, dipping as low as $1.07 in late 2022. Even still, dollars buy a lot more than they used to in the UK, so it’s a great time to be travelling and shopping at British businesses.

RELATED: How to Get British Products Forwarded to the US or Canada (When They Don’t Ship There)

Modern British Money Slang

The most popular slang term for British money is “quid”. A quid = £1, and there’s no plural form to the word. You can have one quid, five quid, a million quid – but you don’t have quids. “Smackers” could also mean £1, as in, “He wanted 500 smackers for his stereo system.”

Amounts in pence are often abbreviated as “p” (pronounced “pee”). For example, a public toilet might require 30p for access. If something requires pounds and pence, you could say 5 pounds 50 pence, but you’re more likely to hear “5 pounds 50”.

£5 notes and £10 notes are frequently called a “fiver” or “tenner”.

Back to the topic of toilets, if someone tells you they’re off to “spend a penny”, they’re telling you they’re off to use the toilet. They’re not literally going to spend a penny. In places where they have pay toilets, you’re more likely to spend anywhere from 20p to £1 – but luckily, many busy railway stations have been abandoning the fees in recent years.

British Coins

There are 8 coins currently in circulation:

• 1 penny
• 2 pence
• 5 pence
• 10 pence
• 20 pence
• 50 pence
• 1 pound
• 2 pounds

The image above will give you an idea what they look  like, but remember that designs can vary (there are quite a few collector’s pieces in circulation) – and also keep in mind that the pound was redesigned in 2017, and the older design has been withdrawn from circulation. It was redesigned to reduce counterfeiting, as the Royal Mint estimated that a bit more than 3% of all pound coins in circulation were fake. The new design features a rose for England, a leek for Wales, a thistle for Scotland, and a shamrock for Northern Ireland.

You can see the new pound below:

More recent British pound coins feature a bimetallic design – making it much harder to counterfeit.

There are also some larger coins not in common circulation (but still legal tender):

• 5 pounds
• 20 pounds
• 50 pounds
• 100 pounds

Until 1984, there was a half penny, and for a while during the 70s and early 80s, there was a 25 pence piece.

British Banknotes

There are four denominations of Bank of England notes currently in circulation:

• £5
• £10
• £20
• £50

Most people visiting the UK will deal primarily in the first three. At some smaller shops, you may find them reluctant to make change for a £20 note, so it’s a good idea to keep smaller notes or coins on hand if you’ll be in places that don’t accept cards (though in this day and age, most places do).

The Bank of England will be issuing a new polymer £20 note in late February 2020, but the old notes will con