Should we get rid of the penny? That’s the question posed at Gather Little By Little today.
He shows how the price of materials and production has gone up so much, that it costs more than $0.01 to make a penny these days.
But, should we get rid of those little Lincolns?
I say, "No way!"
I don’t use pennies much. In fact, I don’t use cash much at all. I use debit cards and gift cards for the most part.
But, I’m afraid of what would happen to prices of items if we had to round to the nearest nickel.
I doubt retailers would round down on items, so it seems prices would go up 1-4 cents to eliminate the need for pennies.
That $0.99 item? Oh, it’s now $1 on shelves. Add on 6 or 7 or more percent sales tax, and you’re looking at $1.07. Oh noes! I guess you’d better make that $1.10.
It seems that for most items, prices don’t end in a 0 or a 5. That means that if we were to get rid of pennies, prices of just about everything would go up a few cents.
Not a ton of money, but it will certainly add up over time.
What do you think?
Yeah, I get a lot of pennies at work from adding taxes and such. I agree that removing pennies would raise prices.
I agree… I don’t think it would be a very wise move to remove that from our money. Off the bat, it wouldn’t be a huge difference, or seem like it anyway, but in the long run, I certainly think it would make a big impact.
I think we should get rid of the penny. Yes, there might be an slight negative affect for consumers in the beginning, but each penny is costing more than it’s worth to make. We are paying for that loss in our taxes. Plus the material, copper, is worth more than the penny. There is severe risk that the penny will start being melted down and used for the copper b/c it is worth more that way. History tells us, this is how the decline and devastation of other countries currencies began.
I don’t think we should get rid of the penny, but I feel like I’m part of a minority who still care about pennies. Can’t count the number of times I’ve seen people drop pennies on the ground and not pick them up or even throw them away because they’re “not worth carrying around”! I wonder what percentage of the nation’s pennies are in circulation and what percentage are sitting in coffee cans in people’s houses?
This is an interesting way of looking at it.
I don’t normally get rid of it, but not trying to save as much pennies as I can either
It’s an interesting question. i have SO many pennies all over my van and on my dresser and in my wallet….i should put them all in a cup and take them to the bank and buy myself a .99 hot fudge sundae from McDonald’s on the way home. Good. That is settled.
I grew up in Peru, South America. We had a similar coin to the penny called the centimo. The country stopped using it, and most retailers were fair about rounding up or down. They also included sales tax (which was 18%) in with the prices on the shelves. So if the item said “50 centimos” then you could pay with a 50 centimo coin. I miss that! Things are so confusing here in the States. I feel like I never know what my total bill is going to be.
Wow, interesting topic! I’m Canadian orginially and we’ve got the same money as American’s. I mean 1c, 5c, 10c, 25c, but we also have $1 and $2 coins.
In 2002 I moved to Britain and they have believe it or not coins of 1pence, 2pence, 5pence, 10pence, 20pence, 50pence, 1pound, 2pound.
The 2pence coins are about as big as a quarter!
Now since 2006 I have lived in Australia and they DON’T have pennies!!
They have 5cents, 10cents, 20cents, 50cents, $1, $2 coins.
It’s amazing, I didn’t think it would work when I first moved here but it’s so nice not having any pennies in your wallet!
Both in Britain and Australia sales tax is included in the display price, so if it say’s $1.50, that’s what you pay!
If the price is 0.99 they do round it up and you give them a dollar. If the price comes to say $1.47, you give them $1.45.
Seems to work pretty well!
I would personally be in favour of no pennies in both the US and the UK. I have lived in both countries and am not a fan of them. I’d also love to see US sales tax incorporated into the prices. I know that may not always be possible (e.g. online) as you have state rather than federal taxes, but it should be possible in stores.
I currently live in Australia. As Bec said, we no longer have pennies. They were phased out in the early 90s so I’ve spent about half my life without them now. I think the key thing is that only the total of your purchase is rounded rather than each item, and only if you’re paying cash. It’s also rounded to the nearest 5c, so a $34.77 bill would actually be rounded down to $34.75 not up to $34.80. If you pay by credit/debit card, you pay the unrounded amount so it’s not even an issue for the majority of my transactions since I rarely pay cash now.
There’s some interesting statistics regarding the rounding process from a study at the University of Melbourne, hope you don’t mind me linking to it: http://www.scc.ms.unimelb.edu.au/whatisstatistics/coins.html
I’m not sure how I feel either way — it’s obviously worked for other countries, so why not here? But then again, there could be increases in some prices.
Pennies aren’t made from copper anymore — they’re mostly zinc. (http://www.usmint.gov/about_the_mint/fun_facts/index.cfm?flash=yes&action=fun_facts2)
That would make them extremely cheap to make, I think.
Coins are cheaper than paper money to make, from what I understand — a lot of countries have coins for the smaller dollar denominations and it works out well — they last longer.
I save my pennies. Banks and many grocery stores are happy to exchange them for dollar bills! I’ve recently seen several nickels in the ubiquitous “penny” dishes at check-outs. Round up to the nearest dime, anyone?!
Losing pennies wouldn’t bother me much at all. Even if you make 100 purchases every month that are affected, to the tune of the maximum 4 cents each time, it won’t add up to much. In this scenario, you would pay 100 x $0.04, or $4.00 more every month. That’s $48 per year, and that’s something I have a whole lot of trouble working myself up over.