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US stops minting unloved $1 coins

By Claes Bell · Bankrate.com
Monday, December 19, 2011
Posted: 12 pm ET

There's a lot to like about $1 coins. They are more durable than paper money, and they're easier and cheaper to handle. The only problem is, Americans hate using them.

Because of that, the Federal Reserve has literally entire warehouses full of unused $1 coins returned to them by banks because people don't want them. From Robert Benincasa and David Kestenbaum at NPR's Planet Money:

The federal government will stop minting unwanted $1 coins, the White House said Tuesday. The move will save an estimated $50 million a year.

Earlier this year, we reported on the mountain of $1 coins sitting unused in government vaults. The pile-up -- an estimated 1.4 billion coins -- was caused by a 2005 law that ordered the minting of coins honoring each U.S. president.

We calculated that the unwanted coins had cost taxpayers some $300 million dollars to make. There were so many coins piling up that the Federal Reserve was redesigning a vault in Texas to help hold them all.

We got to see a vault in Baltimore. It was the size of a soccer field, filled with bags of dollar coins.

On the merits, dollar coins are all-around better than dollar bills, but as long as you make them optional, rather than taking $1 bills out of circulation to force the change, Americans will kick them to the curb.
That's true for a couple of reasons. First off, I think people in the U.S. have kind of stopped thinking of coins as real money. Most people seem to look at coins as "loose change" and "pocket change," not holders of real value.

The other reason is that American men generally don't carry an item that's pretty much ubiquitous in places with valuable coins: a coin purse or wallet capable of securing coins. Whenever I'm in Europe visiting the Swedish branch of my family, I'm always struck by how pretty much every dude walking around over there has a coin holder, which is a real rarity in this country and in approximately the same class of coolness as, say, a calculator watch or Velcro shoes.

Of course, that problem would immediately be solved as soon as $1 bills were eliminated. While it might take a while for men to abandon their classy money clips, there are a few things people hate more than losing money. It would only take a few bucks rolling out of their pockets to make men reconsider the style characteristics of coin-carrying wallets.

But people like paper money, and they hate $1 coins, and Congress is having difficulty even mustering up the political will to keep the lights on at this point, so I don't see it happening anytime soon. As a result, it's probably smarter for the government to keep the $50 million.

What do you think? Do you like $1 coins?

Follow me on Twitter: @ClaesBell.

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393 Comments
Ron
February 17, 2012 at 12:32 pm

The mistake was making the dollar look to much like a quarter.
I would consider using coins if I would not have to worry about being short changed.

Pyledriver
February 17, 2012 at 11:15 am

I see that the Fed makes another lack of reasoned decision. Just do away with the dollar bill and have no other alternative. Guess what, the dollar coin will be used.

What about thos of us who are collecting a set for the grandkids or whomever?

Pull your heads out Fed -- oh yes, I foget, that may be impossible. Let me see, is this another example of Congress being unable to make a directionable decision?

BP
February 17, 2012 at 10:51 am

This is a step in the wrong direction. Coins last almost forever but paper bills last about 42 months.

We'd save taxpayers $5.6 BILLION if we adopted coin usage for small amounts. The $1 paper bill should be completely abandoned - there's too much money at stake to shrug this off.

John L.
February 17, 2012 at 8:28 am

This country used to have $1 coins -- they were large and made of silver, namely known as silver dollars. They were accepted. The jokes that are $1 coins now are practically indistinguishable from quarters and feel like quarters. The only time I see them is when I buy my Rapid pass once a month and get them as change. They go in my change jar along with the quarters, dimes, nickles and pennies.

tom
February 17, 2012 at 6:34 am

bought a bus pass in los angeles, usualy get $ coins as change.

the most recent resulted in , for a $1.80 pass,

2 one dollar coins and the remainder in quarters.

64 quarters.

(and two dimes)

Jim L
February 17, 2012 at 5:37 am

To the commenter who asked "what real man wants to carry a purse" -- they are coin holders, not "coin purses -- any more than a money clip or a wallet is a "money purse". If you are so hyperconcerned about having your coins held in a little rubber thingy that you carry in your pocket being seen as "carrying a purse", then you aren't a real man at all.

Jim L
February 17, 2012 at 5:24 am

It says "In God We Trust" on the front left side of the Sackajaweja coin. Most "Real Americans" make some effort to not spread lies.

Annie
February 17, 2012 at 12:28 am

I sometimes visit friends in a big city and I don't drive nor do most of my friends because there is little need to with public transit, when I buy passes in the machine at the bus stop they don't have a way to dispense change in bills so it gives you $1 coins. Imagine getting $5 in change back when you pay with a $20 for a $15 pass in actual change. That's a lot of quarters. It would be easier to use dollar coins if machines like the self check outs at Walmart accepted them or if the bank offered $1 coins without you having to request them in other countries they have there own equivalent of $1 and even $2 coins, like when I went to Ireland I think I got 2 euro coins, or maybe it was pounds, Ireland has 2 forms of cash when we were in Derry I think we used Pounds, and in Dublin Euros. Also I think it would be cool to have $25 bills then when you have $75 you can have a $50 and a $25 bill.

ragmaniac
February 16, 2012 at 10:08 pm

The only way to ever see $1 or $2 or $5 U.S. Coins in common circulation, is to begin a gradual shortage of $1 paper money. As long as U.S. Coinage stays below the value of 50 cents, and until such coinage reaches a value of $5, people will always see it as 'small change.' Not until the coinage includes enough $2 and $5 coins will Americans give it its appropriate psychological value.

thedanimal
February 16, 2012 at 9:42 pm

i decided to read through most of the comments..
only a few have a clue about the fed reserve..
most of the comments simply dont see past the nose on
abe lincoln. again,,, the problem isnt the size or shape or number on the coin....the problem IS ONLY the value of it and the fact that it will buy less goods as time marches on