The US Mint announced this morning that they will phase out the production of new pennies beginning in late 2010, and mint the last batch of pennies on April 1, 2011. The final batch of pennies will be released in a set of proofs which will be auctioned off to coin collectors with the proceeds going toward our national debt. The last run will be limited to 50,000 proof sets, and opening bidding is expected to start at $179.99, which is affordable considering you will own a piece of US numismatic history.
High cost of making new pennies to blame. The announcement follows years of speculation regarding when the US would stop minting pennies, as it actually costs more than 1 cent to produce a penny. On average, pennies cost 1.4 cents to make, making penny production a losing proposition, especially when the US Mint produces billions of pennies annually. Add the fact that “a penny just doesn’t buy what it used to,” and it’s clear the US Government is making the right decision by eliminating the penny.
What will happen to all the pennies? Pennies will remain legal tender, but you will be hard pressed to find stores willing to accept them after April, 2011, because the US Mint will impose additional handling fees for purchasing rolls of pennies and they will institute a penny buy back incentive.
Starting in late 2010, the US Government will begin “Pennies for Freedom,” a penny reclamation campaign designed to collect the estimated 23 trillion unused pennies sitting in people’s homes and coin jars. The pennies will then be melted and the copper will be used for green energy projects throughout the US. This is part of the Obama Adminstration’s plans for reducing US dependence on foreign energy.
How will stores handle transactions without pennies? We are moving toward a cashless society and most transactions are handled electronically with credit cards and ATM cards, or with a check. So eliminating the penny won’t actually affect most people. For people who insist on paying cash, the US Mint recommends that stores round up or down to the nearest nickel. Note: As a side effect, expect state and local sales taxes to increase to round up to the nearest nickel as well to make accounting easier for stores and cashiers.
Eliminating the penny benefits everyone! No more pennies means we all win! It is estimated the average person loses $38.92 in pennies throughout their lifetime. Change will be easier to count and manage, and purses will be lighter. No more looking under car seats, under couch cushions, sifting through the coin jar, etc. I’m looking forward to it already!
Penny Fun Facts:
- It costs more than 1 cent to make a penny – Snopes.
- It is illegal to melt US coins to sell for scrap metal – US Mint.
- Composition of the US Penny – US Mint.
- US Penny – Wikipedia.
- Efforts to eliminate the US Penny – Wikipedia.
- How Much Is a Penny Really Worth? Not Enough to Keep Carrying It That’s For Sure – Own the Dollar.
- A Penny Saved is Worth More Than a Penny Earned – Cash Money Life.
$$$ And if you haven’t figured it out by now – Happy April Fools Day! 
Disclaimer: No pennies were harmed in the writing of this blog article. All facts, figures, and other information were made up on the spot or carefully edited for effect, except for the Penny Fun Facts, which lead to legitimate sources of information.
penny photo credit: Nbauer.
{ 19 comments… read them below or add one }
Ha you got me for a second.. I like counting my pennies. Happy April Fools Day!
BloggingBanks
Ha! You had me until I got to the part about minting the last batch on April 1st. Then it clicked. Good one, though! Happy April Fool’s!
Hahaha! Great post. Love it.
I’m embarrassed to admit that you totally got me!
Thanks, everyone. Just having a little fun.
Haha, nice Patrick. I had this whole comment response to it and just scrolled down to see your reply that it’s just a joke. I should have known, good one.
Ha ha, except there are some valid reasons to phase out the penny. I love that it costs more than a penny, to create a penny.
Miss M: The US Mint actually makes a profit on pennies, even though it costs more than a cent to mint them. The reason is that so many fall out of circulation, and so many are bought as proof coins by collectors. I doubt we will see the end of the penny for a long time – though it certainly wouldn’t bother me if we did.
Funny . . .
I’m NOT embarrassed to admit that you got me — totally. Well, I admit I hurriedly scanned the article, so didn’t catch every nuance. But for two reasons, I wasn’t at all surprised. One is that because of inflationary pressures, which have continued throughout the Bush admin. and will get much worse during Obama’s, pennies have become almost worthless in terms of real buying power. Second is that because of the radical decisions already made by Pres. Obama, almost no news coming out of this admininstration will surprise.
That was the goal, Dave. To make it a plausible story, but drop in a few red flags along the way – just to make it fun.
Thanks for reading.
Aiyah! I was completely fooled. And I even linked to this article…..hehe.
Anyway Malaysia stopped its 1 sen coin last year, I think. …..really.
Regards
Coming late to the article, but I agree with a couple of posters above – much of the article is actually quite accurate even if hasn’t factually occurred yet! And I was going to say that we probably “lose” more than $38 in pennies over our lifetimes – that is, if you include all the coins we “lose” this way.
sent this to coinflation… I was getting ready to sort like mad until I read the “by the way” line… stop messing with me… geez
heheh. Just having a little April Fool’s Day fun.
No way I could have left people hanging without telling the truth though. That would just be mean!
Good job Patrick
I was about to run to the bank to buy 1000 rolls of pennies.
Then again, I may do that anyway
Have fun folks
John
Good one.
I was gonna say…………….You’re looking forward to “the US Mint recommends that stores round up or down to the nearest nickel” ?! Sad that it wouldn’t surprise me to hear that coming from our almighty genius government officials who did nothing to earn their positions other than pay the fees and do the time in school- not the naturally intelligent people we need running things. Recommending that stores simply charge you more than the actual price of the item, multiplied by gazillions of purchases…? Imagine that. As if we could assume that stores would actually ROUND DOWN. Now I’m afraid that someone in government will actually see this and get a bright idea… or some rich lobbyist group…
I don’t get it.