What to do with old money(Image: Owen Humphreys - PA)

It's more than just the date on the front of coins that change as time goes by - periodically old money goes out of circulation as new portraits of the Queen, designs and security features come into force.

But what can you do if you're left holding onto some out-of-date cash and can you get anything for it?

It's a pressing question at the moment, with the old £20 Sir Edward Elgar bank notes about to be withdrawn. It's estimated that there are around 125 million of these notes still in circulation but after 30 June 2010 they cease to be legal tender.

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Not legal tender, but still worth something
Just because something is no longer legal tender does not mean you can't use it. In fact, Scottish and Northern Irish banknotes are not technically legal tender in the rest of the UK - as the term has a very narrow and technical definition.

"In ordinary everyday transactions, the term 'legal tender' has very little practical application," the Bank of England explains. So what does it mean then?

"If a debtor pays in legal tender the exact amount he owes under the terms of a contract, he has good defence in law if he is subsequently sued for non-payment of the debt," according to the Bank.

"Whether or not notes have legal tender status, their acceptability as a means of payment is essentially a matter for agreement between the parties involved."

And that means banks, building societies and Post Offices will accept old notes for some months after they are officially "withdrawn".

But even if you find an old £20 note next year, for example in a jacket or pair of trousers you haven't worn for ages, but the high street banks won't exchange it, don't despair. You have the right to swap the notes at the Bank of England itself.

The Bank promises that it will honour the face value of any note issued, even notes from before the Second World War.

This can be a laborious process so it might be worth spending half an hour looking down the back of the sofa and in the pockets of infrequently worn clothes before you head off to Threadneedle Street.

Why notes change
The Elgar £20 notes have been replaced by the Adam Smith £20 notes which were introduced in 2007. This is the fourth different version of the £20 note since 1993.

The changes are necessary to keep one step ahead of the counterfeiters. The new £20 Adam Smith design has more raised print (run your finger along the words 'Bank of England' on one and you'll see what I mean) and a greater number of flecks that show bright red and green under an ultraviolet light.

The £20 note is by far the most popular note for counterfeiters. According to Bank of England figures in 2008, just 12 in every million fivers in circulation were discovered to be forged.

The figure for tenners was lower at eight per million, but 514 £20 notes per million were taken out of circulation because they were counterfeit.

There have been just two versions of the £50 note in nearly 30 years, meaning there are fewer security features on them, although a new issue is being introduced within a year with industrialists Matthew Boulton and James Watt on the note.

Yet the 2008 forgery rate for the highest denomination note is just 19 per million. It may be that forgers have not bothered with £50 notes because they are much more carefully scrutinised by the recipients and refused point blank by some retailers.

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