After years of debate, the U.S. federal government has officially announced it will stop producing the one-cent coin — the penny — by early 2026. The decision comes following bipartisan support in both the House of Representatives and the Senate, and concerns over the rising cost of minting the coin.
The move was outlined in a new plan released by the U.S. Treasury Department this week.
Why the Penny Is Being Phased Out
The main reason behind the decision is simple: it costs more to make a penny than the coin is worth.
According to the Treasury, the cost to produce a single penny has jumped from 1.3 cents to 3.69 cents over the last decade. That’s nearly four times the coin’s value, leading to unnecessary government spending.
The Treasury estimates that ending penny production will save the U.S. about $56 million every year.
Final Penny Production Already Ordered
In its announcement, the Treasury Department confirmed it placed its final order for blank penny coins in May 2025. These are the last pennies that will be made. Once they’re in circulation, no new pennies will be produced, and the coin will gradually disappear from everyday use.
The plan was first reported by the Wall Street Journal and confirmed by the Treasury to Reuters.
Trump’s Role in the Penny Decision
In February 2025, former President Donald Trump directed Treasury Secretary Scott Bessent to begin the process of ending penny production. Trump called the coin “wasteful” and said its continued minting was not a good use of taxpayer money.
Shortly after, Republican and Democratic lawmakers introduced bills in both chambers of Congress supporting the phase-out of the coin.
How Will This Affect Cash Transactions?
As pennies disappear from circulation, businesses will begin rounding cash payments to the nearest nickel (five cents). For example, if your bill totals $1.02, you may pay $1.00 or $1.05 in cash, depending on store policy.
Electronic transactions (credit/debit cards and mobile payments) will still be charged exactly — no rounding will be needed for digital payments.
A Brief History of the Penny
The penny has been part of U.S. currency since 1793. The familiar face of President Abraham Lincoln has been on the front of the coin since 1909. The coin is made mostly of zinc with a thin layer of copper.
Despite its long history, the penny has become less practical in modern times.
Should the Penny Stay or Go?
Americans have debated the penny’s usefulness for years. Supporters say the coin helps keep prices fair, helps charities collect donations, and serves as a symbol of tradition.
Critics argue the penny is a nuisance, often left in drawers or piggy banks, and not used in real purchases. Its low value means it no longer has real buying power.
Currently, there are about 114 billion pennies in circulation, according to the Treasury. While no new ones will be made, these coins will continue to be used — at least until they naturally wear out.