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When is a dollar not worth its weight in gold? When you're measuring in pounds.

British pounds, that is.

A few years ago, the pound reached an exchange rate of $2 against the American dollar for the first time since September 1992. While the pound has weakened a bit since then, it still makes for a challenging exchange rate for Americans traveling in the United Kingdom.

And though the exchange rate for the euro remains decent, Europe is one of the world's most expensive regions to explore. Hotel rates are sky-high in major capitals like London, Paris and Moscow, and the hefty cost of living (particularly in Scandinavian countries) makes everyday purchases such as meals and public transportation tickets a pricey proposition for travelers.

But that doesn't mean you can't see Europe on a budget. We've gathered 25 tips to help you save your pennies (or pounds!) on your next trip to Europe.

1. Get rate quotes in U.S. dollars. Long before you travel, when you are booking your hotel, car rental and other non-flight essentials, try to get quotes in U.S. dollars and pay in U.S. dollars whenever possible. This way there are no surprises when your credit card statement arrives and you find out you paid a lot more than your quick back-of-the-envelope estimate when calculating the exchange rate. With the boom in Web booking, many international hotels now offer guaranteed dollar rates to U.S. travelers; inquire at the time of booking.

2. Find your focus. When planning your European itinerary, consider exploring one region or country in depth rather than bouncing around from place to place. For example, spend a week sightseeing in Florence and taking day trips to nearby towns in Tuscany rather than trying to squeeze Milan, Venice, Florence and Rome into seven or eight days. You'll not only spare yourself hours of sitting in transit, but you'll also save big on transportation expenses such as airfare or pricey train tickets. Learn more about slow travel.