American Penny passed away today after a long illness. It was 238 years old.
The last penny was minted at the US Mint in Philadelphia on Wednesday afternoon under the supervision of US Treasurer Brandon Beach, President Donald Trump announced via social media in February that he directed the Mint to stop making the once-popular coin, citing production costs.
It costs about four cents to mint a penny, which exceeds the value of the coin. While it was once so valuable that “penny candy” like gumballs could be purchased and fed to parking meters or toll booths, today pennies mostly reside in coin jars, junk drawers or “Leave a Penny/Take a Penny” tray.
Beach said Wednesday that the last coins pressed will be auctioned off and that the actual last coins put into circulation from the U.S. Mint were taken out in June.
Penny lived 168 years longer than her sibling, Half Penny. It is survived by nickels, dimes, quarters and the rarely seen half dollars and dollar coins.
Despite its demise, the money will remain legal tender.
For a coin that appears to be obsolete, its removal from circulation is causing more problems than expected, especially for retailers.
Some traders plan to round prices to the nearest nickel, often a penny or two more. Others are asking customers to pay with money to help with supplies. But in some states, traders may face legal trouble for rounding up or down.
Additionally, any savings made by discontinuing the one cent coin may be offset by the need to press more nickels, which costs the U.S. Mint more money than the penny.
Mark Weller, executive director of Americans for Common Cents, said the government’s phaseout of the penny has been “a little chaotic.” The Pro-Penny Group is funded primarily by Artazan, the company that provides the blanks used to make pennies. “By the time we get to Christmas, the problems will become more apparent with retailers running out of money.”
Weller said other countries, such as Canada, Australia and Switzerland, which have removed low-denomination coins have guidance to follow. This is not the case in the United States.
“We had a social media post (by Trump) during Super Bowl Sunday, but no real plan for what retailers would have to do,” he said, referring to the president’s February announcement.
Kwik Trip, a family-owned convenience store chain that operates in the Midwest, has decided to discontinue cash purchases in stores where it is not making money.
Company spokesman John McHugh said, “There is no way we wanted to charge (customers) an additional 2 cents because we didn’t think it was fair.” “I mean, it’s not their fault there’s a money shortage.”
But with 20 million customers per year, and 17% of them paying in cash, the policy will ultimately cost Kwik Trip a few million dollars a year, McHugh said.
It is not only businesses that face increased costs. Reaching the nearest nickel would cost consumers about $6 million a year, according to a July study from the Federal Reserve Bank of Richmond. That’s quite modest, about five cents for each of the 133 million American households.
And rounding is not a national solution.
According to the National Association of Convenience Stores (NACS), four states – Delaware, Connecticut, Michigan and Oregon – as well as several cities, including New York, Philadelphia, Miami and Washington, DC, require merchants to provide exact change.
In addition, the law covering the federal food assistance program called SNAP requires recipients not to be charged more than other customers. Because SNAP recipients use a debit card that is charged the exact amount, if merchants lower prices for cash purchases, they could open themselves up to legal problems and fines, said NACS spokesman Jeff Lenard.
“Rounding all transactions presents many challenges in addition to the average loss of 2 cents per transaction,” Lennard said. “We desperately need legislation that allows rounding so retailers can make changes for these customers.”
For that reason, NACS and other retail groups recently wrote to Congress asking for legislation to deal with the questions raised by the end of penny production.
The penny was one of the country’s first coins, first minted in 1787, six years before the mint was established.
Benjamin Franklin is widely credited with designing the first penny known as the Fugio cent. Its current form came in 1909, on the centennial of Abraham Lincoln’s birth, when it became the first American coin to depict the president.
But both its use and popularity have declined since then. The Treasury Department now says there are an estimated 300 billion pennies in circulation. This works out to a little less than $9 for every American. But most of those coins are “highly underutilized.” Therefore, the public outcry over its demise has subsided.
Joe Dettler, a 74-year-old Colorado author and historian, said he still has an old cigar box filled mostly with money given to him by his grandfather. He remembers flattening pennies on train tracks or souvenir machines at amusement parks.
However, he rarely uses pennies to make cash purchases. And he often tosses a one-cent coin in the tip jar.
“They bring back memories that have stayed with me throughout my life,” he said. “Penny has had a great life. But maybe it’s time for it to go.”
—CNN’s Danny Freeman contributed to this report