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In a pivotal moment for American currency, the penny was officially retired in 2025, a decision driven by a combination of its high production costs and declining usage. For years, the penny found itself relegated to the depths of sofas and forgotten car cupholders, lying unused and largely unmissed in everyday transactions.
Now, as we adjust to the absence of this once-ubiquitous coin, our attention shifts to the nickel, the next smallest unit in the U.S. currency system. With the penny out of the picture, the nickel has started to play a more prominent role in both retail and consumer transactions, even though new pennies are still being minted for the time being.
According to the latest figures from the U.S. Mint for the fiscal year 2024, producing a nickel costs nearly 14 cents, a figure that highlights the inefficiency of minting a coin that is worth less than its production cost. While the penny was notorious for being a financial drain, the nickel now stands as the only remaining coin that incurs a loss, as it costs more to produce than its face value.
This shift in the currency landscape prompts a reconsideration of the value and practicality of our coinage. As pennies become a relic of the past, collectors and curious citizens alike begin to ponder the worth of their old coins and bills. To determine if your currency might hold more value than its face suggests, experts offer guidance on what to watch for in your change drawer.
Many retailers have warned that, because pennies are harder to come by – you may be partially to blame, but more on that in a moment – they may round the change you receive when paying with cash. In most cases, transactions are being rounded to the nearest nickel in your favor.
That may not be enough to save the nickel, however.
“It’s actually a little easier to get rid of the nickel,” Robert Whaples, a professor of economics at Wake Forest University, explained to Nexstar. With dimes and quarters, there are other ways to make change that ends in a zero or five. Only pennies can be used to give you $1.27 in change.
The U.S. also now has precedent for ending the production of a coin without congressional action.
Alternatively, the U.S. could change the composition of the nickel. That happened to the penny, much to the annoyance of collectors of a certain souvenir, back in the 1980s.
Nickels contain hardly any nickel at all. According to the U.S. Mint, a five-cent piece is only 25% nickel, with the rest made of copper. The Mint said the high cost of copper contributed to the increased cost of producing a penny, which is just 2.5% copper.
Last year, Treasury Secretary Scott Bessent said efforts were underway to determine how to lower the cost of nickel production. Mark Weller, executive director of the pro-penny group Americans for Common Cents, told CNN in November that changes could be made to bring the cost of nickel production closer to 5 cents.
The nickel – originally called the “half disme,” pronounced “dime” – may seem like the logical next coin to go, but the penny was targeted for decades before production finally ended.
“I think it’ll be a while before the nickel bites the dust,” Whaples said. He suggested the common conundrum as a test, explaining that a lot of people no longer stop to pick up the penny they see lying on the ground. They will, however, pick up a nickel.
When people are no longer stooping over to pick up a nickel, that’s when the nickel’s “fate will be sealed.”
Changing the nickel’s status, whether it’s ending production or rejiggering the composition, would, of course, require someone to take action.
“There’s just this inertia in the system where they don’t like change,” Whaples said.
There is, however, a bill in Congress that calls for the production of the nickel (and the penny) to be suspended. It was referred to the House Committee on Financial Services in December.
Does that mean you should stock up on the nickel? Maybe only if you want it to face the same fate as the penny.
“We got rid of [the penny] because people ‘stocked up’ on them,” he said. “In other words, they got the change and they just put it in their jar, they never brought it back. Had they brought it back, had everybody brought these things back, then we wouldn’t have been running out of them.”
When pennies weren’t being spent and deposited, the Mint had to produce more to supply banks and retailers. Those pennies would be given to customers, perpetuating the vicious cycle.
It’s estimated that more than 300 billion pennies are out in the world – more than 800 pennies, or $8 worth, per U.S. citizen – trapped wherever a little Lincoln can roll, fall into, and hide.
“That’s really what killed the penny, that people didn’t bring them back,” Whaples said. As for now, the penny and nickel are still legal tender. Nickels, including those honoring America’s semiquincentennial, remain in production.