On Feb. 9, Pres. Trump instructed the Treasury to stop producing new pennies. This didn’t surprise anyone because rumors about the penny’s demise have been circulating for years. Nor did it upset anyone, because many people have been hoping for this.
But wishin’ and hopin’ had nothing to do with this decision. The government’s initiative to slash costs led to the penny’s undoing and the reason for this is very simple: The government can no longer afford to make pennies.
A penny is worth only one cent, but it costs 3.72 cents to make one. In other words, the government loses 2.72 cents on every penny it makes, and while this doesn’t sound like a lot, those cents add up very quickly.
In 2024, the Mint produced 3.2 billion cents, which adds up to a loss of more than $85 million. This is like paying $3.72 for a $1 bill – not a very wise business strategy. Now the government decided to start becoming penny-wise and stop being dollar-foolish.
By the way, the next time you get a nickel in your change, take a good look at it because, more likely than not, it too is headed for the chopping block, and for the very same reason: The cost of producing one has increased to 13.8 cents, which is a lot more than it’s worth. “It costs four times more to make a penny and three times more to make a nickel than it did 20 years ago,” says CNN.
Although the Mint will stop making pennies, they’ll still be legal and will remain in circulation for a very long time. AI Overview estimates that in 2024 there were roughly a quarter of a trillion pennies in circulation in the United States, which amounts to more than 700 pennies per person. About 250 million pennies have been minted this year as of mid-February.
Consumers and stores will presumably continue using cents for the items they buy and sell. So the demand for pennies will remain relatively unchanged. But without any new pennies being produced, the supply will gradually diminish and possibly be phased out over a period of years. In the interim, coin collectors and others might decide to “stock up” on pennies while they are still available, as an investment and in some cases for nostalgic reasons, adding to demand.
A Different Era
Young people may find this difficult to believe, but back in the day, a penny actually had some value. True, it was never worth a great fortune, but it could buy a piece of gum, candy, or the like. Someone who had five or ten cents could buy a candy bar, a bag of potato chips, a comic book (or two), a newspaper, a few apples, or other simple items. Obviously, we’re living in a different era now and these are just pleasant memories.
“Pres. Trump’s decision to do away with the penny is way overdue,” Clay Teague of Scotsman Coin and Jewelry told Fox News. “The penny has outgrown its usefulness.”
Although Trump will get the credit (or blame, depending on your perspective) for ending the penny, others have tried unsuccessfully to do this years ago. Prominent among them is former Pres. Obama, who wanted to discontinue both the penny and the nickel. By the way, the U.S. would not be the first country to do away with pennies. Canada phased out its penny back in 2012, and it also stopped printing dollar bills – it uses only dollar coins.
Long History
The penny is on the way out now, but it has played an important part in U.S. currency for well over two centuries. According to Wikipedia, “The first official mintage of the large cent was in 1793, and its production continued until 1857 when it was officially replaced by the modern-size one cent.” The Large Cent was canned because it had become too expensive to make. But well into the 1800s, the U.S. currency included a Large Cent, a modern size penny and even a Half Cent, which gives us some idea of how much lower prices were years ago.
In any case, today the penny has become more a relic of the past than a valuable or even useful coin. When charging for purchases, some stores “round down” rather than bother to make exact change with pennies. And some consumers prefer “rounding up” by paying an extra few cents and walking away from the register rather than waiting until the shopkeeper finds the number of pennies they are owed. Some stores have a dish filled with cents by the cash register with the sign “add one, take one” as a convenience for those who don’t want to fill their pockets with pennies.
Useful Anyway
There is no longer anything we can purchase for a penny, but that doesn’t mean it is useless. Some people use it to open or tighten screws, or to stop the pages of a book they’re reading from flipping when they step away. Pennies also find their way into collection boxes of charities, so they’re a simple way of improving the world.
Pennies also serve another function, one that will not go away any time soon: a long-standing role in collecting coins. “The penny is actually very collectible in certain dates, such as the 1943 zinc one,” says Teague. The Mint couldn’t use copper that year because it was needed to make munitions for the war.
Other pennies that are highly prized by collectors include the 1914-D (the D indicates it was minted in Denver), the 1909-S (minted in San Francisco), and the 1909 SVDB (minted in San Francisco; the VDB on the reverse side refers to Victor David Brenner, the artist who designed the Lincoln cent).
As a generality, Indian Heads (made before 1909) are more valuable than Lincoln Heads, which were introduced in 1909. More recently, for some reason, fewer coins of all denominations were produced in 2009 than in other recent years and their lower mintage may add value to some of them.
At first glance, Trump’s decision to cancel the penny seemed like a death knell for this coin. But it wasn’t. In fact, in some circles there is renewed interest in the penny. Wouldn’t it be ironic if Trump’s remarks actually boost the penny’s value and spark a new generation of penny collectors? And so many people have written off the penny!
A penny for your thoughts.
Sources: AI Overview; cnn.com; npr.org; scottsdalemint.com; theconversation.com; wfmynews2.com; wikipedia.org; zerohedge.com
Gerald Harris is a financial and feature writer. Gerald can be reached at This email address is being protected from spambots. You need JavaScript enabled to view it.
