Farewell to the Penny

After nearly two centuries, the U.S. government is ending the production of the penny. The U.S. penny discontinuation means that, in time, these coins that you grew up with will no longer be in circulation. For many Americans, the penny is more than just pocket change. It’s a nostalgic reminder of childhood piggy banks, exact-change and “a penny saved is a penny earned.” While often overlooked in daily life, the penny has been a constant in wallets, registers and charity jars for generations.

This change stands to impact everything from retail sales prices to coin collectors. And, with the penny taken out of production, a bit of U.S. history will be lost. High production costs are driving the decision to discontinue the penny. According to the United States Mint’s 2024 annual report, it costs 3.7 cents to manufacture a single penny, meaning the country is spending more on producing pennies than the coins are worth.

In February, President Donald Trump called for the Treasury Department to halt penny production. “For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!” Trump wrote on Truth Social. “I have instructed my secretary of the U.S. Treasury to stop producing new pennies.” The Treasury Department has announced that it will stop manufacturing pennies, placing its last order for penny blanks in May. Those blanks, which are manufactured into pennies, will run out in early 2026, at which point penny production will cease.

High coin production costs have prompted several other countries to phase out their lowest-denomination coins. Australia ended production of its 1 and 2 cent coins in 1992, and Canada followed suit by phasing out its penny in 2012. New Zealand eliminated its 1 and 2 cent coins in 1990 and later discontinued the 5 cent coin in 2006.

While production costs are cited as the main reason for discontinuing the penny, the United States is also shifting toward a cashless economy, reducing the demand for coins and cash. According to Pew Research Center data, as of 2022, about 41% of Americans said they do not use cash for purchases in a typical week, up from 29% in 2018 and 24% in 2015. The trend suggests that consumers are increasingly turning to digital payments for everyday transactions. Source