The penny is on its deathbed, but questions remain about what a penniless Canada will look like.
The Royal Canadian Mint stopped producing the one cent coin last year, and now the process of rounding up pennies and melting them down will begin. The Mint estimates six billion pennies will be recovered, although some 35 billion pennies have been produced since the Mint opened in 1908.
And so, as you contemplate life without pennies bouncing around in your pocket, CBCNews.ca raises a few questions you may not have thought about.
What would happen if every Canadian spent all their pennies?
Could pennies power the economic recovery? Well, no, several economists said.
Here’s a "completely unscientific analysis" by York University finance professor Moshe Milevsky: "I just counted nine pennies in my coat pocket. Multiply that by 30 million [a rough estimate of the Canadian population] and you get $2.7 million extra spending … not much to get excited about."
Of course, many Canadians have more pennies than that. But even if there are 30 billion pennies out there, the $300 million that amounts to doesn’t make a huge difference to the $1.7 trillion Canadian economy, say experts at Montreal investment firm MacDougall, MacDougall & MacTier.
And, adds Milevsky, spending your time scrounging around for pennies may take away from more productive and valuable economic activity.
Who wants your pennies?
While pennies don’t make a major difference to the national economy, they do matter to the bottom lines of many Canadian charities.
Canadian Guide Dogs for the Blind, which trains guide dogs for the visually impaired, uses life-sized coin collectors in the shape of golden retrievers and Labradors to collect coins at shops across the country. The organization raises about $300,000 in coins every year — a large portion of which is pennies, says spokesperson Steve Doucette.
"This year might be OK, but going forward it may hurt us," Doucette says, adding he hopes more nickels will be donated after the penny’s demise.
Doucette hopes people aiming to shed their pennies will choose the doggie-themed drop off, but other organizations are also trying to capitalize on the coin’s death.
Free The Children, an international charity based in Toronto, is holding a nationwide penny drive from Feb. 4-9 to raise money for its global water initiative. The charity believes 2,500 pennies is enough to give someone in a developing country clean drinking water for life.
Youth – who are at the core of Free The Children’s fundraising – have already been searching for every penny they can find, spokesperson Tamara Kaftalovich says.
It’s a simple idea, but as Kaftalovich notes, "that simplicity adds up."
Should I go through my penny jar to see if any are super valuable?
The "collectability" of a penny is based on how many of its kind were minted in a year, says Daniel Silverman of the Canadian Coin Association. That means your penny minted along with over a billion others in 2006 isn't worth holding on to.
But, if you happen to have a rare 1936 "dot cent" — you probably don’t, Silverman says, as there hasn’t been a sighting in years — you’re rich. The "dot cent" refers to a dot that appears directly underneath the date.
The last "dot cent" penny to be auctioned off sold for $402,500 US in New York in 2010. Silverman says those pennies, called "the king of Canadian coins," all sell for upwards of $100,000.
How will businesses cope?
Bonus penny facts
- The cent remains the base unit of Canadian currency, so there won’t be rounding when you pay with credit or debit cards.
- Taxes like GST and HST will be based on the pre-tax price, the rounding will take place after.
- The penny cost the Royal Canadian Mint 1.6 cents to make before it was discontinued last spring.
- "Free your pennies from their prisons," Finance Minister Jim Flaherty told Canadians ahead of the 2012 budget.
- The Royal Canadian Mint isn’t sure what will happen to the American pennies they’ll be taking in. "This is an issue we are reviewing at the moment," Mint spokesperson Alex Reeves told CBC News.
The Retail Council of Canada, which represents some 45,000 vendors, says the majority of businesses are ready for life without the penny — though it’ll be a costly change for some large retailers who are spending around $100,000 to update their payment systems to round prices.
"Large retailers will not be able to rely on manual rounding," says council spokesperson Sally Ritchie. "This is an expensive proposition when considering every cash register they have in the country."
From a business perspective, the new price rounding rules will be mostly a wash.
"In some transactions, rounding works out to the customer’s advantage; in others, to the retailer’s," Ritchie says.
At Dark Horse Espresso Bar, one of downtown Toronto’s numerous cafés, the staff has been rounding prices for a while now. If your Americano comes to $2.98, "that’ll be three bucks."
You can still pay with pennies — though according to Canada's Currency Act you can only use 25 at a time — but they aren’t even kept in the register. Staff throw the coins in a bucket, and when it’s full they bring it to a bank’s automatic coin counter to cash them in.
Will the expression ‘a penny for your thoughts’ die too?
When the penny goes, will "a penny for your thoughts" be meaningless? Will future generations look blankly at you if you advise: "a penny saved is a penny earned"?
Word nerds rejoice — they're safe.
"They will survive for quite a long time as expressions referring to a small quantity," says Wolfgang Mieder, a professor of German and folklore who has written over 100 books on proverbs.
"There are many proverbs in the language right now that refer to weights, measurements, currencies, etc. that are no longer in use … In the EU, for example, the Euro with its cents has not replaced the pennies of phrases that contain them," Mieder says.
So farewell, penny. You'll be in our language, and likely our clutter, for a while yet.