No More New Pennies In Washington State, Oregon, Or Anywhere Else

232 years ago the first United States penny was struck at the Philadelphia Mint.  The original design was a woman with flowing hair meant to represent Liberty.  The Philadelphia Mint is also where the final penny was struck yesterday under the observation of U.S. Treasurer Brandon Beach.

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What Exactly Does That Mean?

It means that for the first time since 1792 we will not be producing new "copper coins".  It means that the U.S. Government is looking for different ways to save money in the face of a nearly $2 trillion annual deficit.  The cost of producing a penny, or one cent, is not less than one cent.  It doesn't even break even at one cent.  The fact is, it costs more than 3.5 times the face value of a penny (3.69 cents) to make a penny.

It's an estimated savings of $56 million a year by ending production.  Another factor that weighed into the decision is the continued increase in cashless transactions for just about everything.  According to data from Capital One, just under 87% of point of sale transactions last year were done minus physical money.

This Won't Create A Catastrophe

Pennies will still be accepted currency because each penny has a circulation life of roughly 30 years.  Adding to that, all out of circulation currency, like the $500 bill (featuring President William McKinley), is still accepted because it is U.S. money.  The penny will never not be accepted.

The U.S. Mint made 3.2 billion of the Abraham Lincoln adorned coin (since 1909) last year alone so there are more than enough pennies in circulation (57% of all coins are pennies).  The decision to end production yesterday doesn't mean pennies will never be produced again as the Mint still plans on striking certain collector pennies.

The first coin ever produced for circulation in the United States becomes the first to be discontinued, at least as of the foreseeable future.  You can read more about the history of the penny and what the future looks like without striking it by clicking here.