Leave a penny, take a penny. The ubiquitous one-cent coin has lots of fans, and lots of detractors. For years it has cost more money to make a penny than the value stored in them, which gets smaller and smaller every year. (This is true for lots of U.S. coins.) Still, we just can't quit the penny, even if most of them seem to spend their days in jars and couches, rather than in our pockets where we might reach for them to pay for goods and services.
Consider these reasons why it's time we put away our pennies for good.
Key Takeaways
- A penny is only worth about half of what it costs to produce.
- The U.S. Mint is profitable as an organization, contributing hundreds of millions of dollars to the Treasury every year. But the penny is a money loser for the Mint.
- Picking up that found penny is not worth your time; the effort required returns less than what you'd earn making the minimum wage ($7.25 an hour).
9 "Centsible" Reasons to Get Rid of the Penny
- Pennies don't buy as much as they used to: In 1913, a penny purchased a little more than a quarter does today (about 28 cents).
- Producing the penny costs taxpayers money: In 2021, each penny produced cost 2.10 cents to make and distribute. In 2021, the Mint made 7.60 billion pennies, costing taxpayers $145.8 million.
- Pennies are made of zinc and copper, and zinc can be harmful: Zinc mining and industrial use has negative environmental and health impacts. During mining, smelting, and other industrial processes, zinc can leach into the soil, water, and air, and cause health concerns for those living nearby.
- Some of the zinc for penny manufacturing is imported: In 2020, zinc imports added $1.3 million to the $310 billion U.S. trade deficit with China.
- Pennies are heavy to carry around: Each one only weighs 2.5 grams, but they add up. A dollar's worth of pennies would weigh 250 grams, or about half a pound. Consider that a $1 bill itself weighs just 1 gram.
- Making pennies is a money loser: While the U.S. Mint is a net contributor to the U.S. Treasury, producing pennies is a money loser for the Mint. In 2021, the nation lost $83.6 million making pennies.
- Pennies take up time at the cash register to count out: If time is money (see below), then pennies are not worth the time it takes to handle them.
- The use of cash in retail transactions continues to decline: In 2020, cash was used for just 19% of in person transactions. That's down from 26% in 2019. Debit cards top the list as the most used payment instrument, accounting for 28% of payments.
- Found pennies aren't worth the effort required to pick them up: The federal minimum wage is currently $7.25 an hour. At that wage, it takes five seconds of work to earn a single cent. If you took longer than that to pick up a spare penny found on the ground, your effort would be earning less than minimum wage.
Note
Getting rid of the penny will not be easy. To do so, Congress must enact a law that removes the penny from circulation. It must also direct the U.S. Mint, a bureau of the U.S. Treasury, to stop producing them.
Why We May Keep the Penny, Anyway
On the flip side, slightly more than half of Americans are emotionally attached to the penny. A poll by Yougov.com found that 51% of Americans were in favor of keeping it. More than a third (34%) would be disappointed if the government stopped making pennies, and another 9% would be downright angry.
More than half take their pennies when offered as change. Only 39% leave them in the "give a penny, take a penny" dish offered by some retailers.
Note
Many Americans are penny-pinchers. When surveyed, 71% said they pick up pennies they see on the ground.
Another poll found that 77% worry about the "rounding tax." This is the idea that if the penny were eliminated, businesses would round up prices ending in $.99 to the nearest dollar. A 2001 study by Pennsylvania State University estimated that it could cost consumers about $600 million per year, but other studies found there would be no change.
Many people have an emotional connection to the penny because of its history. It's been in circulation since 1793, and it has borne Abraham Lincoln’s face since 1909.
History of the Penny in the United States
The penny first entered circulation in 1793 as a pure copper coin. In 1857, the U.S. Mint added nickel to the copper to cut cost, as the cost of copper was rising. In 1864, the Mint switched to tin and zinc (bronze) instead of nickel.
In 1943, pennies were made of zinc-coated steel. Copper had become essential to the war effort during World War II. The Mint accidentally made 40 copper pennies, which have become highly sought-after collectibles. The record amount paid for a 1943 copper cent was $204,000 in 2019.
In 1962, pennies were no longer made with tin. Since 1982, the penny has been made with 97.5% zinc and just 2.5% copper. At 2.500 grams, it weighs more than a dime (2.268 grams).
Should Other Coins Be Eliminated, Too?
Many of the reasons for eliminating the penny apply to other coins as well. Inflation has destroyed the value of nickels and dimes as well as pennies. And in some cases, they cost more than they are worth (nickels) and are money losers for the Mint (nickels, again). We could easily get rid of pennies, nickels, and dimes and be no more inconvenienced than the average person in 1913. Our pockets would be lighter by not having to make the additional change. Time spent at the register would be less without having to count out dimes, nickels, and pennies. And no one would have to wonder where to cash in coins.
Frequently Asked Questions (FAQs)
Which pennies are worth money?
All pennies are worth money, but some have become collectible. Collectors may seek out coins that were minted under unusual circ*mstances or with outdated designs, thus adding value to some pennies.
When did pennies stop being made of copper?
Today's pennies are still made with copper, but the composition mixes copper with zinc. The original penny first circulated in 1793, and it was made entirely of copper. The composition first changed in 1857 to a mix of copper and nickel.
