The End of the Penny? Why It’s Time to Ditch Small Change for Good
A recent CNN article highlights a financial paradox: it costs more to produce pennies and nickels than they are actually worth. In 2024, the U.S. Mint reported that a single penny costs 2.72 cents to make, while a nickel costs 8.8 cents—far exceeding their face values. This inefficiency results in millions of dollars in losses annually, raising the question: is it finally time to phase them out?
What’s the Deal with Nickels and Pennies?
Other countries, such as Canada and Australia, have already eliminated their smallest denominations without significant economic disruption. Instead, they round cash transactions to the nearest available unit, while digital payments remain exact. The U.S. has resisted this change, but as production costs continue to rise, the debate is heating up.
My Take: A Penny for My Thoughts
Surprisingly, I’m completely in favor of getting rid of the penny. As a consumer, pennies are useless—nobody wants to carry them, count them, or use them in transactions. They’ve lost their practical value in daily life, especially in an era where most payments are digital. If I’m paying for something online and the price is $2.99, that’s fine, but handling physical pennies for change? No thanks.
Honestly, I’d take it even further. Nickels and dimes should go too. The only coin that’s still useful in daily transactions is the quarter. Everything else just clutters wallets, jars, and store registers without adding real convenience.
From a collector’s standpoint, eliminating these coins isn’t a big deal either. The U.S. has retired many coins in the past—the two-cent coin, three-cent silver, three-cent nickel, and twenty-cent piece all disappeared without causing major problems. In fact, removing the penny would create a well-defined “bookend” for collectors, allowing them to collect a full, finite series of U.S. cents from the first to the last.
This also presents an opportunity for the U.S. Mint to release a special final edition penny, possibly with unique proof versions or commemorative marks. If they play it right, the last year of production could be a collector’s dream.
Wait, What About Change?
One concern that often comes up is: how will stores handle change if we eliminate smaller coins? The reality is, we’re already anchored to a decimal-based system where we don’t deal in half-cents. If something costs $95.78½, we don’t have a way to pay that exact amount in cash anyway.
For business-to-business (B2B) transactions, fractional pricing already exists—restaurants, for example, buy plastic forks and toothpicks at fractions of a cent per unit, and those transactions are handled digitally. If we eliminate pennies and nickels, cash transactions will simply round up or down to the nearest available denomination—just like they do in countries that have already ditched their smallest coins.
Final Thoughts: Should We Leave the Penny Behind?
At the end of the day, it’s just not that big of a deal. Businesses will adapt, pricing strategies will shift, and consumers will barely notice the difference. What we will notice, however, is a more efficient currency system that doesn’t waste money producing coins nobody wants.
Maybe it’s finally time to let go of the penny and nickel—and give our change a much-needed change.
