The idea came up frequently throughout the pandemic. Pay online, use debit cards for payment, or use exact change. After all, we were told that money is full of germs because of all the people who handle your bills and coins. But the pandemic is over. Why do some businesses continue those guidelines? Why do they not give change? The answer is simple: it costs too much to make more money [1].
Cost To Mint Coins
Making a nickel costs more than double what it’s worth. As of 2022, every five-cent nickel costs 10.4 cents to make. According to a biennial mint report, this is up 40% from 2020, when the cost was 7.4 cents.
Other change costs have gone up, too. Currently, dimes and quarters are worth more than they cost. The cost to make a dime increased from 3.7 cents in 2020 to 5 cents in 2022. That is a 34% increase! Continuing, making a quarter went from 8.6 cents to 11.1 cents. That is a 29% increase in cost.
Reducing Costs
In the report from the Mint, they propose switching to producing nickels, dimes, and quarters with a different composition of metals to save money.
Nickels haven’t been made solely of nickel in decades. Instead, nickels, dimes, and quarters are coated with a nickel-copper mixture, mainly covering an all-copper inside layer. Using more copper and less nickel, the mint believes it can decrease costs.
This would not apply to pennies, which cost 2.7 cents to make.
Based on 2022 volumes, the mint estimates the savings could add up to about $12 million. Right now, the Senate has a bill in committee that would allow the Mint to change over to the new mixture of metals. Hopefully, they right the situation soon.
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