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What Happens When You Throw Away Coins | May 2024

It’s estimated Americans toss up to $68 million worth of pennies, nickels, dimes, and quarters every year.

Coins in America

Divisibility as a characteristic of money is a very important principle. However, Americans are finding they need spare change less and less. For example, public transportation, laundromats, vending machines, toll booths, and parking meters historically relied on bills and coins. Now, they typically accept credit card or mobile payments.

Some people feel carrying physical currency is an annoyance. The Federal Reserve estimates more than half of the coins in the country are in people’s homes rather than their pockets. Others use their coins or exchange them for cash at a bank or coin-counting machine (such as Coinstar), however, some banks such as Capital One, PNC, and TD Bank no longer have coin-counting machines.

Cost to Produce Coins

It costs more to produce pennies and nickels than their face value (see Chapter 15, Table 15.2). However, what the U.S. Mint loses on pennies and nickels it makes up for with profits on dimes, quarters, and half-dollars. Profits fluctuate over time because of the rising and falling costs of copper, zinc, and nickel, but dimes and quarters have always been profitable for the U.S. Mint.

Reclaiming Lost Coins

For the past seven years, Reworld, a sustainable waste processing company, has separated and sorted metals to find the spare change thrown away by Americans. It estimated it has collected more than $10 million in coins. The company, which recovers about 550,000 tons of metals annually, saw an opportunity to reclaim coins when it noticed more and more coins in the trash.

Reworld has a series of separators and sorters to filter through the metals it collects, including soda cans, keys, silverware, and coins. One sorting machine collects objects that are the color of coins, another filters objects that are round and flat, and another separates objects by weight. Any coins found are then cleaned, dried, and sorted by hand to filter out foreign coins and other tokens.

The Future of U.S. Coins

Considering the penny costs more to make than it’s worth, some experts have called on the U.S. government to stop producing the penny like Canada, New Zealand, and Australia which have all killed their 1-cent coins. Pennies are often viewed as being economically inefficient and an inconvenience. On the other hand, others say eliminating the penny would lead to price increases and would harm low-income households. Some people believe that one day coin production will stop altogether.

In the Classroom

This article can be used to discuss the characteristics of money (Chapter 15: Money and the Financial System).

Discussion Questions

  1. Why are Americans using physical currency less frequently?
  2. Describe the process used by Reworld to reclaim discarded coins.
  3. What are some arguments for and against the continued production of the penny?

This article was developed with the support of Kelsey Reddick for and under the direction of O.C. Ferrell, Linda Ferrell, and Geoff Hirt.


Sources

Aimee Picchi, "Americans Throw Away $62 Million in Coins Each Year," CBS News, October 18, 2016, https://www.cbsnews.com/news/americans-throw-away-62-million-in-coins-each-year/

Joe Ryan, "We Toss $62 Million of Loose Change Every Year. This Company Wants Some of It," Bloomberg, October 12, 2016, https://www.bloomberg.com/news/articles/2016-10-12/trash-piles-yield-treasure-as-sifters-seek-sooty-coins-in-ashes

Oyin Adedoyin, "Americans Throw Away Up to $68 Million in Coins a Year. Here Is Where It All Ends Up," The Wall Street Journal, April 17, 2024, https://www.wsj.com/finance/americans-throwing-away-coins-28ca794c

About the Author

Geoffrey A. Hirt of DePaul University previously taught at Texas Christian University and Illinois State University, where he was chairman of the Department of Finance and Law. At DePaul, he was chairman of the Finance Department from 1987 to 1997 and held the title of Mesirow Financial Fellow. He developed the MBA program in Hong Kong and served as director of international initiatives for the College of Business, supervising overseas programs in Hong Kong, Prague, and Bahrain, and was awarded the Spirit of St. Vincent DePaul award for his contributions to the university. Dr. Hirt directed the Chartered Financial Analysts (CFA) study program for the Investment Analysts Society of Chicago from 1987 to 2003. He has been a visiting professor at the University of Urbino in Italy, where he still maintains a relationship with the economics department. He received his Ph.D. in finance from the University of Illinois at Champaign-Urbana, his MBA at Miami University of Ohio, and his BA from Ohio Wesleyan University.

Profile Photo of Geoffrey A. Hirt