Cashing USA Cheques in the UK and Exchanging Large Amounts of Dollars to Pounds

PLEASE HELP!

At different times I will be transfering money from my HSBC bank checking account in the USA to an HSBC "Passport" account I will be opening in the UK.  I will also have a monthly pension cheque mailed to me in Britain, made out in USA Dollars, for a few months before a direct deposit system can be worked out.  Some of the money I plan on transferring will be in rather large amounts.  However, I wasn't expecting crazy exchange rates like $2.17 per Pound!  I thought the advertised rates of $1.99 and $2.00 were out rageous enough, but $2.17?!  

My question is what would be the cheapest way for me to transfer US Dollars to British Pounds?  Should I just withdraw my US money a little at a time from a cash machine where the rates are supposedly at advertised value and not at these other higher hidden rates?  How would I go about cashing one of my pension cheques made out in US Dollars without paying these cost ridden rates and fees?

I wasn't really expecting this much money gouging from high street banks.  I'm also told the Post Office usually gives the best straight-up exchange rate from US Dollars to British Pounds.  Is this true, or is this another falacy?

THANKS!!!!

i'll post again when I get home but my relocation agent sent me some literature on a company that specializes in recurring transfers from abroad for substantially less fees (supposedly).

oh, what fee are you being charged for the HSBC to HSBC transfer?

I'm a user of XE.com.  Once set up it's easy to use and it gives a very fair exchange rate, probably around 2.01 to get 1 pound

See this topic, or search for others in this forum, you'll find plenty of discussions on this subject.

http://talk.uk-yankee.com/index.php?topic=33206.0

If you currently bank at HSBC in the US, you should be able to open a regular UK HSBC account before you go to the UK. That would give you better terms than the Passport account and no fees. My husband and I were able to do it--our HSBC branch had no idea what they were doing, so we basically had to tell them what to do, but the info here on UK-Y got us through. Look back through this forum or do a search to see what other people have done.

I would second xe.com. We did one HSBC to HSBC transfer because we needed the money quickly, and the fees are ridiculous.

the post office charges no exchange fee. that's where we usually go when we're heading back to the states or coming back to the UK with a fair amount of us dollars.

True the Post Office charges "no commission", but the exchange rate they give you is poor.  Today they are charging $2.1858 to get one pound, the true exchange rate would require $1.99564 to get one pound.

This means they are taking a 10% profit on the deal!

I think it is criminal that all these places say they charge no commission and hide fat profits in poor exchange rates.  This should be regulated by the FSA (government), they should all give the true exchange rate and then explicitly show you what they are taking in profit.  The way it is now it is very confusing to see if you are getting a good deal or not.

HiFX is the company with the advert in the us expat mag the relocation agent sent me. www.hifx.co.uk or 0845 370 5292.

They say:
* no commission
* every monthly transfer of funds is free
* simple direct debit with your UK bank
* fixed exchange rates for up to 24 months

I've found that I'm able to use any cash machine here and I'm charged the current exchange rate, plus a $1 network fee. You should short yourself out with a money transfer account or service like XE, for example, but in the mean time you should be safe using a cash machine.

Can your pension be set up for direct deposit? A lot of people like to keep a bank account in the US, and that way you could just transfer money between your US and UK accounts once your pension is paid in.