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US stops minting unloved $1 coins

By Claes Bell, CFA · 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
russ mckay
February 16, 2012 at 9:04 am

The new dollar coin omitted "In God We Trust" for the FIRST time ever.(And that wasn't even mentioned)

Gary
February 16, 2012 at 3:37 am

I liked the $2 coins they have in Australia. It's easy to recognize because it's really thick and gold in color, but it's not that big in diameter. Like a really thick nickel. They also don't have pennies and round to the nearest 5 cents. Their bills are all a different color and are made of a waterproof material that appeared to be plastic and cloth. They felt very durable compared to our bills. They're also all different lengths, which benefits the blind.

Ken Sherman
February 16, 2012 at 3:02 am

Make a $1, $2,, and possibly a $5 coin but use an amount of real silver in those coins. The amount of silver used in each of the coins should not be worth more than what the coin is worth and how much it costs to product it. Coin collectors will love it, people would want the coins, and the coins would always have some meaningful value.

BILL BOUR
February 16, 2012 at 2:12 am

I was able to buy the 1$ gold coins at the banks through about eight presidents. Then the banks were unable to supply them for some unknown reason. I went to the coin shops and could buy a $25 roll for $33. Why was the supply of these coins stopped? If I am not mistaken, In GOD WE TRUST did not appear on the new coins. This alone created a hate for the coin. After two previous intoduced coins failed use, why did they mint a third coin(Presidents)and imagine just changing the face of the coins would be accepted? Why are they still printing $2 bills with no vacant space in register drawers? No one uses them except for birthday cards sent to children. How many $2 bills do you see ever being used? Get rid of them first then the introduction of (creative) (size,shape and or color) a new $1 coin and start phasing the $1 bill out of print. One coin that is not overly popular is the .50 cent coin. Why? because they are not preferred and can be substituted with two Quarters that can be used in millions of vending macnines, news paper vending, laundromat washing & dryer machines. When did anyone ever see a vending machine use a 50 cent coin? Get rid of the 50 cent coin along with the $2 bill and eventually the $1 bill. A new $500 or even a $1000 bill I believe would be accepted and used more than a look alike $1 coin.

Lucy S
February 15, 2012 at 9:46 pm

Coins are bulky and add weight to a purse. I rather carry $1 bills.

J R Brown
February 15, 2012 at 9:40 pm

Is it really necessary to state the obvious? What would you rather carry around...$20 in coins or $20 in bills? Who wants to walk around with a pocket full of coins when bills are so much lighter and easier to deal with?

Apparently, common sense just isn't all that common.

jack hines
February 15, 2012 at 7:32 pm

If you eliminated pennies, nickels and quarters, added a smaller half dollar, plus $1, $5, and $10 coins, sizing them reasonably, people would carry coins and use them with no problem. I hate to get 4 cents change. Men don't like change because it doesn't buy anything anymore! The presidents could still be represented well, etc., vending machines, parking meters, etc., would be far easier to use and the government would save money not reprinting low denomination bills. Cash registers could handle the coins since we are eliminating as many as we're adding. Sure, the changeover would be a little clumsy, but we'd be good for another 50-100 years.

harry
February 15, 2012 at 6:58 pm

we need to use only gold colored $1 coin and eliminate the $1 paper bill. we have agood $2 bill to use.

It is silly to use so many quarters in vending maches, etc. when a dollar coin is the obvious answer!

actually, the banks and stores are prejudiced against the $2 dollar bill because they do not have enough slots in their money drawers. eliminating the one dollar bill will solve this problem. Then more people will be accepting of a decernable one dollar coin (gold color). hello Canada!

kk
February 15, 2012 at 6:27 pm

I don't like to carry any cash and coins are bulky and slow down travel thanks to metal detectors. I much prefer to use plastic. I'd rather see more options for electronic payment methods by smaller vendors and simplify life for all of us. Everyone can accept plastic from a smart phone now so folks just need to get with the program. :) Cash takes longer at the checkout and requires more cashier stations to service customers at busy retailers.

In Europe you have to carry cash because so many small shops and vendors don't accept plastic. If we must have cash, let's at least get rid of the dollar bill and the penny before we plan on circulating more coin denominations.

Steve B
February 15, 2012 at 5:59 pm

I would love to have a decent $1 coin, but for some reason, the Mint keeps making the same mistake with their design and creating dollar coins that are very close to the same size and weight as a quarter. For instance in England, the Pound coin is significantly heavier and fatter than any other coin so that you can identify the coin without having to look at it. I can sort pennies, nickels, dimes, and quarters without ever looking at them, but if you throw in some Sacagawea or Susan B. Anthonys and that's no longer the case. All they did to "fix" the problem was to smooth the edges on the Sacagaweas which is not a fix at all.