Encoding questions

My databases all have the default SQL_ASCII encoding.  I read the docs
and it says that you shouldn't use it if you're going to have any
non-ASCII data.  I need to start supporting UTF-8, so it seems I need
to convert my database.  Can I just convert it, or do I need to dump
it, drop it, recreate with UTF-8, and then load the data?

Also is it possible to change the default encoding for databases as
well?  The docs say that you do it with initdb.  Do I have to wipe my
data directory and start over, or is there some way just to change the
default encoding?

Thanks for any help.

Pat