You probably have a jar. It’s sitting on a dresser or tucked away in a kitchen junk drawer, filled with those copper-colored discs that nobody actually wants to carry. Honestly, the penny has become the ultimate financial ghost. It haunts our pockets, clutters our cup holders, and slows down the checkout line at the grocery store while someone digs for that final cent. But the conversation about why we should stop making pennies isn't just about personal annoyance; it’s about a massive, government-scale math problem that just doesn't add up anymore.
It’s expensive. Like, really expensive.
The United States Mint is currently losing millions of dollars every single year just to keep this specific coin in circulation. Most people assume a penny costs a penny to make. Why wouldn't it? But inflation and the rising cost of raw metals have turned the penny into a liability. It’s a strange reality where the physical object is worth significantly less than the effort required to create it. We are literally paying for the privilege of having a coin that most of us wouldn't even bother to pick up if we saw it face-down on a sidewalk.
The Ridiculous Economics of Minting Zinc
Let's look at the actual numbers. According to the U.S. Mint’s 2023 Annual Report, the cost to produce and distribute a single one-cent coin has climbed to roughly 3.07 cents. Think about that for a second. We are spending over three cents to manufacture one cent. In the world of business, that’s a 200% loss on every single unit produced. Most companies would go bankrupt in a week with that kind of overhead, yet the federal government keeps the presses rolling.
Why is it so pricey? It comes down to the price of zinc.
While we call them "copper" pennies, they are actually 97.5% zinc with a thin copper coating. Zinc prices are volatile. When global demand for industrial metals spikes, the cost of our pocket change goes through the roof. In 2022 and 2023, the Mint spent over $100 million just to cover the deficit created by the penny and the nickel (which also costs more than five cents to make). It feels like a glitch in the system that nobody is rushing to fix.
Some people argue that getting rid of the penny would lead to "rounding inflation." The fear is that if a coffee costs $3.99, businesses will naturally round up to $4.00, essentially taxing the consumer. But economists who have studied countries that already ditched their smallest denominations—like Canada, Australia, and New Zealand—say this fear is mostly overblown. In Canada, they use a "Fair Rounding" system where cash transactions are rounded to the nearest five cents, but digital payments stay exact. If your total is $1.02, you pay $1.00. If it’s $1.04, you pay $1.05. Over time, it basically washes out to zero.
Canada Already Did It (And They’re Fine)
In 2013, Canada officially stopped distributing the penny. The world didn't end. The Canadian economy didn't collapse into a heap of maple syrup and regret. In fact, the move was widely praised for its efficiency. The Royal Canadian Mint estimated that it saves the government about $11 million CAD every year.
Retailers in Canada were surprisingly quick to adapt. They didn't need complex new software or massive training programs. They just started rounding. It’s a system that works because it acknowledges a basic truth: the penny has lost its "store of value." Back in the early 20th century, a penny could actually buy things. You could get candy, a newspaper, or even a stamp for a few cents. Today, there is virtually nothing in the American economy that costs a single cent. Even "penny slots" at casinos usually require a minimum bet far higher than one cent.
The argument to stop making pennies often hits a wall because of the "Z-Card" lobby—specifically, the companies that supply the zinc blanks to the Mint. For example, Jarden Zinc Products (now owned by a larger conglomerate) has spent years lobbying to keep the penny alive. It's a classic case of a small interest group benefiting from a policy that costs the general public millions. It’s not a conspiracy; it’s just business. But when special interests dictate currency policy, the taxpayer picks up the tab.
The Time Tax Is Real
Money isn't just about the metal. It’s about time.
Robert Whaples, an economics professor at Wake Forest University, has done some fascinating (and slightly hilarious) research into how much time we waste handling pennies. If you add up the seconds spent by cashiers and customers fumbling with change, it totals hundreds of millions of dollars in lost productivity every year.
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Imagine you’re at a busy cafe. The person in front of you spends 15 seconds digging for two pennies so they can give the cashier "even change." Multiply that by the billions of transactions happening across the country. That time has value. If you value your time at even minimum wage, spending more than a couple of seconds to find a penny is technically a net loss for you personally.
What Happens to the Charities?
One of the most common pushbacks against the idea to stop making pennies involves charitable giving. We’ve all seen the "Pennies for Patients" jars or the local school drives. There is a genuine concern that charities will lose out on those small, mindless donations that add up to big sums.
However, the trend is already shifting toward digital micro-donations. Round-up apps like Acorns or the "round up for charity" buttons at POS terminals are proving to be far more effective than physical coin jars. People are more likely to click a button to donate 47 cents than they are to carry a pocket full of copper to a donation box. The "charity" argument is sentimental, but it’s becoming less grounded in how we actually spend money in 2026.
Environmental Costs You Haven't Considered
We talk a lot about the fiscal cost, but the environmental footprint of the penny is massive. Mining zinc and copper is an energy-intensive process that involves significant land disruption and carbon emissions. Then, you have to transport that heavy metal to the Mint, strike the coins, and ship them in heavy armored trucks to banks across the nation.
All for a coin that usually ends up under a couch cushion.
Because pennies have such low value, they don't circulate well. People don't spend them; they hoard them. This means the Mint has to keep making more of them to replace the ones that have "dropped out" of the economy. It’s a treadmill of waste. We are mining the earth to create something that we immediately hide in jars. It’s an ecological absurdity.
The Military Already Stopped Using Them
Here is a fact that often surprises people: the U.S. military has already effectively stopped using pennies at many of its overseas bases. The AAFES (Army & Air Force Exchange Service) started rounding transactions years ago because shipping crates of pennies across the ocean was too expensive and logistically annoying.
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If the military—an organization known for its strict adherence to protocol—decided that the penny wasn't worth the trouble, why are we still clinging to it at home? The precedent is already there. The "rounding" fear was tested in military exchanges, and the result was... nothing. No riots. No inflation. Just faster lines and less heavy metal to move around.
The Path Forward: How We Phase It Out
Ending the penny doesn't mean the coin becomes illegal. You could still use the ones you have. The transition would look something like this:
- Stop Production: The Mint simply stops striking new one-cent pieces.
- Withdrawal from Circulation: Banks would stop giving them out but would continue to accept them from the public to be melted down.
- Mandatory Rounding for Cash: Legislate a simple rounding rule for cash transactions only. Digital transactions remain exactly the same.
- Nickel Reform: Once the penny is gone, we’d likely need to look at the nickel next, as its production costs are also failing the common-sense test.
We are currently in a weird limbo where our physical currency is stuck in the 1950s while our digital economy is in the 21st century. The penny is a relic. It’s a sentimental piece of Americana that has become a financial burden.
Actionable Steps for the Penny-Weary:
- Cash in your stash: Don't wait for a law change. Take your coin jars to a Coinstar or your local credit union. Many banks have free coin counters for members.
- Opt for digital: If you hate dealing with change, use tap-to-pay or cards. This bypasses the rounding issue entirely.
- Donate your change: If you have pennies you don't want, many grocery stores have "give a penny, take a penny" trays or charity kiosks that accept loose change.
- Support the "COIN" Act: Stay informed about legislation like the Currency Optimization, Innovation, and National Savings (COIN) Act, which occasionally pops up in Congress to address these exact inefficiencies.
Keeping the penny around is essentially a tax on the American public to maintain a tradition that no longer serves a purpose. It’s time to let go of the copper ghost and move toward a more efficient, logical way of handling our money.