- The U.S. Treasury will stop minting pennies by early 2026, ending a 233-year legacy, as production costs now exceed the coin’s face value.
- Producing a single penny costs $0.0369, leading to an $85.3 million loss in 2024 alone — prompting President Trump to halt production and save $56 million annually.
- Canada discontinued its penny in 2012, and critics argue the U.S. penny is obsolete, with even $1 bills costing less to print.
- Cash transactions will round to the nearest nickel, mirroring Canada’s smooth transition, though concerns remain about fairness for cash-reliant groups like low-income Americans.
- With 114 billion pennies still circulating, the coin’s phaseout raises cultural and economic questions, including potential nickel shortages and the end of traditions like ".99" pricing.
For decades, the humble penny has been a symbol of both thrift and government waste, costing taxpayers nearly four times its face value to produce. Now, its days are numbered. The U.S. Treasury will stop minting pennies next year after placing its final order for blank coin templates, with production expected to cease entirely by early 2026. This decisive move, championed by President Donald Trump as a fiscal necessity, marks the end of a 233-year legacy for America’s lowest-denomination coin and could reshape how cash transactions are handled nationwide.
The penny's demise has been a long time coming. According to Treasury data, producing a single penny now costs 3.69 cents — up from just 1.3 cents a decade ago — due to rising metal prices and manufacturing expenses. In 2024 alone, the U.S. Mint lost $85.3 million minting 3.2 billion pennies, a deficit the government can no longer justify.
"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 earlier this year, ordering the Treasury to halt production. The move is projected to save taxpayers $56 million annually.
Critics argue the penny has outlived its usefulness. Even printing a $1 bill (cost: 3.2 cents) is cheaper than minting a penny, which requires smelting a zinc-and-copper blend. Canada discontinued its penny in 2012, and the U.S. military stopped using them at overseas bases in 1980 due to shipping costs.
"We retired them for multiple different reasons, but normally because they were not being used or they just became too expensive to produce," said Caroline Turco of Colorado’s Money Museum, noting the penny will be the 12th U.S. denomination phased out.
The slow fade of cash’s smallest unit
While pennies will remain legal tender indefinitely, their gradual disappearance from circulation will force practical changes. Businesses must soon round cash transactions to the nearest nickel — a shift Canada implemented smoothly, according to retail analysts.
"If we look at the experience in Canada, for the first year after they stopped making pennies, there’s really no change in transactions," said Jeff Lenard of the National Association of Convenience Stores, which handles 32 million daily cash purchases. Electronic payments will still track exact amounts, but cash users may see subtle price adjustments.
The transition raises questions about fairness. Low-income and older Americans — who use cash for 22% of payments, according to Federal Reserve data — could bear the brunt of rounding discrepancies. Jay Zagorsky, a Boston University economist, warns that without legislation mandating price rounding up, eliminating pennies might backfire by increasing demand for nickels, which cost 13.78 cents each to produce. "If we suddenly have to produce a lot of nickels — and we lose more money on producing every nickel — eliminating the penny doesn't make any sense," he told the AP.
With 114 billion pennies ($1.14 billion) still circulating, many languishing in jars or Coinstar kiosks, the coin won’t vanish overnight. Collectors may eventually drive up its value, though Turco cautions against expecting a "skyrocket overnight." The penny’s retirement also spells the end of an era for cultural staples like penny loafers (jokingly rebranded "dime loafers" by Martha Stewart) and the psychological power of ".99" pricing.
As the Treasury seeks cheaper ways to produce nickels, the penny’s fate serves as a reminder: In an era of digital payments and soaring costs, even symbols of thrift can become unsustainable.
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