September 25, 2004

Dollar Coins in the U.S.A.

While shopping at Trader Joe's in San Francisco the cashier asked me if I had kids. Confused but thinking that I was going to be offered some stickers to take to the kids I said yes. Instead of stickers, I was offered two dollars of my change in coins rather than bills.

Dollar coins are treated not as the currency that they are, but rather as novelty items. They're a treat for children, not a coin for every day use. At least, that is what the American public seems to think on the matter.

One paper dollar bill costs the government 4.2 cents to make and has a life span of about 20 months. One dollar coin costs the government almost three times as much to make at 12 cents per coin, but the life span of a dollar coin is 30 years. In other words, for the government to keep one paper dollar bill in circulation for the same length of time as a dollar coin, it would cost the government about 76 cents. Considering the number of dollar bills that are in circulation, Americans could save their government (and thereby themselves in taxes) quite a bit of money every year simply by using dollar coins instead of paper bills.

The vending machines that sell stamps in most post offices give dollar coins as change (though they don't accept them in payment, oddly enough). You can also get dollar coins simply by going to the bank and asking for them. (Granted, you'll have to exchange some paper money for them. Rob, my husband, usually buys $80 worth of dollar coins at a time.)

Simply by using dollar coins, you can expose others to them. The more people become comfortable with dollar coins, the more they may be willing to use them.

Come on, you reticent Americans. The Canadians have not only dollar coins, but two dollar coins as well! If they can do it then we bloody well can too.

24 comments:

  1. Our country got rid of one and two dollar "paper" money years ago. They were replaced with coins, which are a pain in the butt to say the least. Although this is only my personal opinion, I wish we still had our "paper" one and two dollars. Why? ....because they add extra weight to my purse (my handbag is heavy enough already) so at every oppotunity I take any coins (except 10 and 20 cents, need these for parking meters) out of my purse and put it into my ferengi money box (helping with savings to my next American trip :-). mmmm maybe on the other hand that is a good idea, I think I need to ponder this a bit further...LOL

    Another thing that has just about every aussie's dander up is the fact that we don't have one and two cent coins anymore. Our lowest denomination is 5 cents. However, stuff sold in shops still sell for 96, 97, 98 cents etc...when it comes time to tally the shopping at the till, the amount is either lowered or raised to the nearest 5...so if you get something for say $4.57c its rounded down to $4.55c, but if it cost $4.58c it's rounded up to $4.60c. I must add here that it is the final tally that is rounded up or down not the individual product, unless of course you only buy one thing... and ads still say eg.. "only $9.99c" which really means $10...go figure.

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  2. I have 3 or 4 64oz plastic bottles full of coins... I never seem to get rid of them. I guess I like feeling the paper and knowing that they're dollars, and the coins are sub-dollar amounts.

    I should run an experiment and buy things with dollar coins. Next time I use a stamp vending machine I'll probably get a bunch of dollar coins back. Then I'll go to a fast food restaurant and watch the confusion!

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  3. I have the solution. Put Ronald Reagan on the dollar coin, I bet it will circulate much better. And for the $2 coin, I nominate Dr. Martin Luther King.

    MM

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  4. Of course, an Australian dollar is worth 73 of our cents the Canadian dollar is worth 79. Not too long ago the Aussie dollar was only half of ours and the Canadian dollar was slightly less than 2/3.

    I would point out our $2 bills also are considered novelties and don't circulate much.

    Dropping the penny, while it makes economic sense, would not go over very well here, and we haven't had a 2-cent coin since 1873.

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  5. > The more people become comfortable with dollar coins, the more they may be willing to use them.

    I agree with scully377 that coins are heavy. They're bulky, they're hard to carry around for those of us who don't like to carry purses, and they don't sort well. With bills, you can put them in order and then in a wallet and easily and efficiently count through large numbers of them with the flick of a finger. Coins, on the other hand, clump together, fall to the bottom of purses and pockets, are hard to hold onto, and get lost easily. I'm willing to wager that most of us aren't idiot savants that can tell how many pennies are in a coin purse just by looking at it, and it's really embarrassing to dig through to figure out what coins I have while there's a line waiting behind me. Until someone can make a coin cointainer that rivals the efficiency and portability of a wallet, I doubt larger denomination coins are going to catch on. Of course, I'm still hoping for the day when technology can defeat identity fraud, and we can get rid of tangible money completely. Maybe we will eventually set up a credit card system that is coded to, for example, retinal and thumb scans combined with a PIN so we don't have to carry any form of money at all for off-line purchases.

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  6. > Another thing that has just about every aussie's dander up is the fact that we don't have one and two cent coins anymore. Our lowest denomination is 5 cents.

    That's criminally outrageous! Aussies have a reputation for being easy-going, but that's just too ridiculously laid back! If such a thing ever happened here, I would absolutely refuse to patronize any store that either tries to make me use cash or tries to apply such insanity to digital money.

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  7. but how often do we carry around wads of ones? and having a few (as coins) isn't so horridly heavy.

    i have a wallet with two snap shut pockets: one side for cash and atm slips and another for coins. (and a zippered underside for plastic cards.) and i tend to end up with quite a few coins because my kids earn coins here and there and then trade for my ones (they'll take bills or coins, btw.) and i haven't found it to be too much of a problem at all. i think it's just something that takes getting used to. and if you have a reason to do it (like saving the tax payers some dough by using longer lasting currency) then you just might be able to talk yourself into it.

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  8. I wish our dollars was still only worth half yours. Then we would get a lot more for our wool when it sells next week. If the aussie dollar is up we get less for our wool but if we go to America when it's up we get more for our dollar...so the next time I come to America I hope it's up high...I know I'm greedy....:-)

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  9. i've got six pieces of those Sacagawea golden dollar coins..ü all the while, i thought that it was only some sort of collectible item.. it came as quite a surprise to me that it was slowly becoming more and more used by the general public.. hmm, oh well, it's still a very beautiful coin, mind you..ü

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  10. In Europe, we have one and two euro coins. A euro is more than a dollar...

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  11. :)

    We have 1 and 2 cents, and the priceshave the usual amount of .98's and .49's. But a lot of stores round up the grand total to the nearest multiple of 5 cents for cash payments.

    Somehow, one never has enough 1 and 2 cents, and it's just not worth the hassle.

    Digital payment is different: there, we use the cent consistently.

    Truth be told: I don't care either way.

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  12. well, it's not really being used more. in fact, they've stopped making them. :-(

    despite the fact that they would save the american public a ton of money, people (in general) refuse to do anything besides collect them.

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  13. When I was in America I found it very difficult to tell which note was what..they all look the same and are almost the same colour.hehe I had to actually look at the numbers on them. Also very confusing was the names for the coins..pennies, dimes, quarters etc..I was just getting used to it when I left to come home...:-)

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  14. I do like keeping coins on me, if I need it for snack or drink machines, and it's often easier to give a few pound coins and get a few coins back than using a note and getting a ton of coins back. Also I need change for bus fares, since most buses don't give change, and I used to need change to use the laundry machines. But in general, notes are easier to carry, although I do prefer just to keep my cards on me, since then I am less tempted to spend but still have a way to pay if I need to in an emergency.

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  15. I'll tell you where all the dollar coins go -- Ecuador. The government changed the national currency to the dollar several years ago, and the people there spend coins far more than bills. They make their own fractional currency up to 50 cents, the same size but with different designs. The dollars on up are U.S. currency, and the dollar coins are spent more than the bills. I've seen both SBA and Sacajawea dollars there. You also wouldn't believe how popular the half dollars are. Most are the national design but you sonetimes get a U.S. version in your change and it's good, too.

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  16. definitely a novelty item and not practical. i don't want a pocket full of one dollar coins

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  17. they're actually very practical.

    we pay a lot of tax money to print paper money. we'd pay less tax money if we used coins for $1 and $2.

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  18. The $1 coin is coming back, this time in the form of a collector series of each President in chronological order. The idea was based on the success of the state quarters. My feeling is they should go with coins and reduce the size of the half-dollar, but "all the other countries are doing it" isn't really a good argument. It didn't work for going metric!

    Peru's coins go up to S/.5 (5 nuevo sols) which is worth about $1.50 to $1.60, depending on the exchange rate. The smallest bill is twice that.

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  19. they keep trying to revive the dollar coin, but until they're able to concurrently stop the printing of paper bills, we simply won't switch over. it's more convenient to use paper bills but cheaper to use coins.

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  20. Dollar coins are great, but congress will never remove dollar bills from circulation. It's kind of difficult to tip a stripper a dollar coin!

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  21. i suppose you'd have to start tipping with bigger bills.

    hmmm, maybe i should find a local strippers union and see if they'd help support a switch away from paper dollar bills. ;-)

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  22. They're way too close to quarters in both diameter and thickness. They should have made them thicker, enough that you could tell by feel that it wasn't George.

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  23. I like the ideas presented here. I am actually working on a $2 Martin Luther King coin. You may see it minted in 2011.

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