How can anyone pinch pennies when there are no more pennies to pinch?
Shoppers who use coupons and look for deals are accustomed to keeping a close eye on register readouts, to make sure they’re not being charged a penny more than they expect. But that’s going to become more difficult in the near future, now that the penny itself is about to become obsolete.
The U.S. Treasury Department’s announcement yesterday that it’s winding down the production of pennies has raised some questions about what impact the move may have on your everyday transactions.
The last batch of one-cent coins should go into circulation early next year. After that, existing pennies will remain legal tender, but they’ll slowly become scarce, as pennies that are lost or stuck in coin jars or otherwise taken out of circulation won’t be replaced.
So major retailers don’t appear to have immediate plans to implement any changes. It has, however, been more than three months since President Donald Trump asked the Treasury Department to eliminate the penny as a cost-saving measure, so retailers have had time to think about how they’ll navigate a post-penny world. But some of the country’s biggest retailers – including Walmart, Target, Kroger and Dollar General – did not respond to requests for comment about what they plan to do once pennies run out.
The most likely scenario is that those who pay by credit or debit will be unaffected and will continue to be charged to the 1/100th of a dollar, while those who pay by cash will have their totals rounded off to the nearest nickel.
What’s not known, is whether any retailers will change their pricing structure. There’s a whole psychology behind charging, say, $1.99 for an item instead of $2. But will anyone be fooled into thinking $1.99 is a bargain when they know it’s going to cost $2 at the register anyway?
There are still state and local sales taxes to consider, which would impact the final price you pay. Would retailers be savvy, or sneaky, enough to ensure that the post-tax price of an item ends in a 3 or an 8 so they can pocket an extra two cents on every sale? That would be a lot of work – and it would only work if that one item is the only thing you buy – but an extra two cents on thousands, or millions, of transactions could really add up.
All of this may not matter to most shoppers who don’t use cash to pay for anything. A recent LendingTree survey found that only 16% of respondents use cash to pay for their groceries. And WorldPay’s 2025 Global Payments Report found that only 11% of all retail transactions in the U.S. are conducted in cash.
Lower-income shoppers do tend to use cash more frequently than higher-earners. So it stands to reason that among the first to implement a rounding-off-to-the-nearest-nickel policy will be stores frequented by lower-income shoppers.
Like Dollar General, for example – which raises the question, will Dollar General’s “penny items” become “nickel items”? Committed deal-hunters have long known that Dollar General reduces many clearance prices down to one cent, as a signal to store employees to remove that item from the sales floor. But if a shopper gets to a penny item before an employee does, they can score a big bargain.
No one can buy an item for a penny if there aren’t any pennies, though. And no one can collect a hundred coupons and turn them in for a penny, either. You’ll often see in the fine print that coupons are said to have a cash value of 1/100th of a cent, because of arcane rules about having to assign an actual value to them. Theoretically, that means you can redeem a hundred coupons and receive a penny – if you can find a store or manufacturer who will actually humor you by doing so. Once pennies are out of circulation, you’ll be stuck having to collect five hundred coupons to earn a nickel instead.
Of course, few if any people are likely to do that. But many of us are watching our spending these days, so keeping a close eye on the grocery budget is more important than ever. Soon, that will just mean watching the register for different reasons – hoping that any rounding is in your favor and not the store’s.
Image source: Alejandro Mallea 
