The 155 year history of the Canadian penny came to a close on February 4th, 2013. The devaluation of the Canadian dollar meant that the penny was now worth one twentieth of what it was worth when first introduced. At the time of elimination, the Canadian penny was only worth about 63% of its production cost. In other words, it cost more to make the penny than the penny was even worth. The elimination of the penny is expected to save the government $11 million a year and reduce handling costs by $140 million.
All prices must now be rounded to the nearest 5 cents, since the nickel will now be the smallest unit of money. However, electronic money will still be rounded to the nearest one cent. This is a change that was perhaps inevitable, but nonetheless will be very interesting to see how it plays out in the next couple of years.
The question now is: Should the U.S. consider doing the same? On one hand, the United States can wait and see how Canada handles business without the penny to determine if it is worth it. On the other hand, inflation will eventually render the penny worthless and not worth producing anymore. In my opinion, it is not too early for the United States to take the initiative and eliminate the U.S. penny. Pennies are no longer needed in today’s society, and retailers will just have to deal with “.95” prices instead of “.99” prices.
So what do you guys think about the whole penny dilemma? Should it stay or should it go? Vote in the poll down below.
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