The era of the penny is nearing its end: starting early next year, the Treasury Department announced that it will end the production of new pennies, leading to an eventual disappearance of the first-ever coin in the U.S.

Here’s everything to know about the coin’s phasing out, what to do with your spare pennies, and more:

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When is the penny going away, and why?

The Treasury Department’s pledge to stop minting new pennies by early 2026 comes after President Donald Trump directed Secretary Scott Bessent in a February Truth Social post to stop his agency’s production of the coins, saying they cost more to make than they’re worth.

“For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!” he wrote in the post. “I have instructed my Secretary of the US Treasury to stop producing new pennies. Let’s rip the waste out of our great nations budget, even if it’s a penny at a time.”

How much does it cost to make a penny?

It costs 3.69 cents to make a penny, whose value is just one cent, according to the U.S. Mint’s fiscal 2024 report. Last year alone, the penny’s production resulted in a loss of $85 million for the Mint.

It’s not just the penny that costs more to mint than it’s worth. A nickel, despite holding a value of five cents, costs a whopping 13.78 cents to make, the Mint report said.

On the other hand, the Mint found, a quarter costs 14.68 cents to make — less than its 25-cent value — and a half-dollar coin costs just 34 cents to produce.

How often do people actually use pennies?

Though the move to phase out the penny may seem sudden, it follows a decade-long trend showing that more and more Americans are relying less on hard currency and cash, and instead on electronic forms of payment such as debit cards.

In 2015, 24 percent of people claimed they didn’t use cash at all in a typical week — and that percentage increased to 29% in 2018 and then to 41% in 2022, according to a Pew Research Center study from that year.

Americans’ opinions on keeping the penny around have also shifted in favor of elimination in recent years. A YouGov poll published in March found that 42 percent of Americans strongly or somewhat support eliminating the penny — a jump from the 34 percent who supported it a decade earlier — while only 30 percent oppose it.

How long has it been around?

The history of the penny stretches back to colonial times, when several foreign coins circulated throughout American society — British pounds, German thalers, Spanish milled dollars and more — that created confusion due to their differing values and origins. This confusion worsened following the Revolutionary War, when The Articles of Confederation proclaimed that each state could produce their own coins.

After the ratification of the Constitution, the Coinage Act of 1792 — also known as the Mint Act — was passed and created the first national mint in Philadelphia, where the U.S. created its first copper pennies in 1793. But producing pennies still saw some hurdles, such as the rising cost of copper, the material solely used to make the one-cent coins.

More than 50 years later, the Coinage Act of 1857 was passed, making it illegal to use foreign currency in the U.S. as legal tender, eliminating competition between American-made and foreign-made currency. The legislation also cut down on the penny’s size and lessened the amount of copper needed to make them, cutting down on their cost.

Today’s pennies are composed of only 2.5 percent copper, and the rest is zinc, according to the Mint.

Has this been tried before?

This isn’t the first time a politician has waged war on the penny. The Price Rounding Act of 1989, introduced by former Rep. James Hayes (R-LA), required any cash purchase to be rounded to the nearest nickel.

Then there was the COINS Act in 2017, introduced by the late Sen. John McCain (R-AZ), which called for halting the production of pennies for a 10-year period and replacing the one-dollar bill with a coin. Neither of these bills ever passed.

But the U.S. won’t be the first country to discontinue the penny, as New Zealand stopped producing their one-cent coins in 1990, followed by Australia in 1992 and Canada in 2012.

What will the end of the penny mean for prices and businesses? 

Businesses will have to start rounding their prices up or down to the nearest five cents, the Wall Street Journal reported.

In countries like Canada, there are different practices when it comes to rounding transactions up or down. Instead of one set rule, some businesses will round down transactions to the nearest nickel, while some round down sales that fall below five cents and round up sales that are more than five cents, according to Business News Daily.

In the U.S., non-cash prices will still continue to be in exact change, according to the Wall Street Journal.

What should I do with my old pennies?

Even after the government stops minting pennies, the ones in circulation will still have value. In other words, your pennies will still work if you bring them to a store and try to pay in cash.

But will today’s pennies soon become a collector’s item? A potential increase in their value remains uncertain.

“I can’t tell the future,” said Julian Leidman of Bonanza Coins, a coin dealer and retail store in Maryland. “I think the penny should be discontinued myself, but only from a professional standpoint. From a collector standpoint, I don’t think it should be eliminated, because the penny has been going on since 1793 and a lot of people collect them.”

Among the most valuable pennies are the Lincoln Wheat penny, which was produced in 1909 and commemorated the 100th anniversary of Abraham Lincoln’s birth, featured the former president’s profile on one side and two wheat stalks with the words “ONE CENT” and “UNITED STATES OF AMERICA” on the other.

Other more valuable pennies are the 1943 Lincoln wheat pennies, were produced during World War II, when the Treasury Department ordered the Mint to produce pennies made of zinc-coated steel to save copper for the military.

In 1943, a small number of leftover bronze planchets got accidentally mixed in with the steel planchets and struck as 1943 Bronze Wheat Pennies. Likewise, in 1944, an estimated 25-30 wheat pennies were accidentally struck on steel planchets instead of copper.

Could the nickel be next on the chopping block?

The discontinuation of pennies would increase the amount of nickels, but the five-cent coin has also come under scrutiny.

Just like the penny, nickels cost more to produce than they’re worth, and that raw production cost is higher than that of the penny. But getting rid of both pennies and nickels would leave the U.S. with only two main coins: dimes and quarters.

Taking another coin out of circulation could further complicate transactions for businesses — but it could also spur a movement away from a physical currency altogether.