The U.S. Treasury Department is officially saying goodbye to the penny, following a February 2025 directive from President Trump.
The federal agency placed its final order for penny blanks in May 2025, signaling the end of an era for one of America’s oldest coins. Production of the humble one-cent piece is expected to cease when these final materials run out in early 2026.
Why the penny no longer makes sense
The decision comes down to simple economics — pennies have become too expensive to manufacture.
According to the U.S. Mint’s 2024 annual report, each penny costs approximately 3.7 cents to manufacture and distribute, making them a money-losing proposition for the government.The Treasury expects to save about $56 million annually by discontinuing the penny.
Despite their coppery appearance, modern pennies are primarily made of zinc with just a copper coating. The rising cost of zinc has more than doubled per metric ton since 2000 and has contributed significantly to the penny’s unsustainable production costs.
Political momentum across administrations
The move to eliminate the penny has garnered bipartisan support. The Trump administration had already signaled this intention earlier in the year, with the Department of Government Efficiency (DOGE), led by Elon Musk, highlighting the coin’s costliness as part of broader federal efficiency goals.
In February 2025, President Trump formally directed the Treasury to halt new penny production, calling the practice “wasteful” in a social media post.
This represents the culmination of years of debate. Previous administrations, including during Jacob Lew’s tenure as Treasury Secretary in 2015, also considered ending penny production due to similar cost concerns.
What this means for your wallet
For consumers and businesses, the phase-out will require some adjustments, but nothing immediate or dramatic. Existing pennies will remain legal tender and continue circulating even after production stops.
No final phase-out date has been announced, but eventually, cash transactions may need to be rounded to the nearest nickel. However, electronic payments will still be calculated to the exact cent.
Since its introduction following the establishment of the U.S. Mint in 1792, the penny has been a constant in American commerce. Its practical value has diminished, but its historical significance remains substantial.
Collectors may find these coins becoming more valuable as artifacts of American economic history.
The penny drops for the last time
As we approach the 2026 end date, the Treasury will provide guidance for businesses and consumers on navigating this change.
There’s plenty of precedent to follow — countries including Canada and Australia have already successfully eliminated their lowest-denomination coins without economic disruption.
Whether you see the penny’s retirement as long overdue or the end of a treasured tradition, the penny will soon be making its final contribution to American commerce after more than two centuries of service.
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