The U.S. Treasury Department has announced that it plans to stop manufacturing the penny in 2026 after more than two centuries in circulation. The cost to produce the penny has increased, with each coin costing about 3.7 cents to mint and distribute. The US government lost over $85 million in 2024 to produce about three billion pennies. Over the years, the coin’s size and composition have changed, transitioning from pure copper to a copper-zinc blend. The price of zinc, the primary metal used to make pennies, has more than doubled since 2000. The U.S. Mint estimates that ending production of the penny will save $56 million annually.
Although pennies will soon stop being produced, they will remain legal tender for cash transactions and can still be deposited at banks. With 114 billion coins still in circulation, the US is unlikely to run out of them any time soon. They will gradually disappear from circulation, which may impact future product pricing for cash transactions, requiring prices to be rounded up or down to the nearest five cents.
The important takeaway from this initiative is to note that there are no plans to demonetize the penny so it is not necessary to take action to deposit excess pennies which may be in your homes.
