Think about the last time you actually used a penny. Probably not recently, right? You might have a jar of them sitting somewhere at home, collecting dust, maybe even forgotten in a drawer or spilling out from under your couch cushions. The reality is, pennies have been quietly fading from everyday transactions for a while now, but in 2025, their disappearance became official. The United States Mint produced its final penny on November 12, ending the coin’s 232-year run. That historic moment marked the beginning of a messy transition period nobody fully planned for. Now, businesses like McDonald’s are scrambling to figure out what to do when customers hand over cash and expect change back, but there are no pennies left to give. The fast-food giant recently rolled out a new cash policy at certain locations, and it’s already stirring up questions about fairness, legality, and what this means for your next Big Mac run. Let’s dive in.
The Penny Problem Nobody Expected This Soon
President Trump ordered the Treasury in February to stop minting new pennies. The rationale seemed straightforward enough. Over the past decade, the cost of producing each penny has risen from 1.42 cents to 3.69 cents per penny. It’s hard to argue with the math when you’re literally losing money on every single coin you produce. The Treasury Department estimates the discontinuation will save $56 million annually.
Here’s the thing, though. The penny shortage hit retailers way faster than anyone anticipated. According to the National Retail Federation, retailers, banks and other businesses that rely on pennies have reported shortages in markets across the country, and experts are surprised that it’s going this fast. By mid-November, more than 100 of the 165 coin distribution sites across the country are without pennies. That’s more than half. The Federal Reserve started rationing what little supply remained, and suddenly stores couldn’t get their hands on the coins they needed to make exact change.
The speed of this unraveling caught everyone off guard. Although the Treasury estimates that 300 billion pennies remain in circulation, the problem is that they don’t actually “circulate” as much as paper bills or even other larger coins. They sit idle. They’re hidden away. Honestly, it’s kind of funny when you think about it. We’ve got hundreds of billions of pennies out there somewhere, but retailers can’t access them because they’re trapped in America’s collective piggy banks.
McDonald’s New Rounding Policy Explained
So what exactly is McDonald’s doing about this penny predicament? McDonald’s confirms that locations in certain pockets of the country are experiencing penny shortages may round up or down to the nearest 5 cents if a customer does not have exact change. The policy isn’t nationwide yet, but it’s spreading as more locations run out of pennies. This would not impact card payments or other cashless options.
The rounding rules themselves are pretty straightforward, if a bit confusing at first glance. Under the policy, cash totals ending in 1¢ or 2¢ are rounded down, while those ending in 3¢ or 4¢ are rounded up. Meanwhile, totals ending in six or seven cents get rounded down to five cents, while eight or nine cents get bumped up to ten. If your total already ends in zero or five cents, nothing changes. You get exact change like always.
This means that if a customer pays with cash at one of these locations, and their order comes out to $10.22, they will pay $10.20, however, if an order comes out to $10.23, then the cash-paying customer will owe $10.25. It all depends on which side of the rounding threshold you land. Sometimes you win a couple of cents, sometimes you lose them. Over time, the theory goes, it should all balance out.
Other Retailers Are Facing the Same Dilemma
McDonald’s isn’t alone in this mess. Love’s Travel Stops, Home Depot and several convenience store chains nationwide now are implementing change-rounding policies. Each company is handling it slightly differently, which is creating its own kind of chaos. Some are rounding in favor of customers every single time, willing to absorb the financial hit. Wendy’s said it has given guidance to restaurants to round cash transactions down to the nearest nickel if they are experiencing penny shortages.
Kwik Trip said all cash purchases at Kwik Trip and Kwik Star locations will be rounded down to the nearest five cents, ensuring a guest-friendly approach, and they will continue that approach until a permanent legislation solution has been enacted. That’s a bold move. A spokesman for Kwik Trip told the AP that rounding down every cash transaction to the nearest nickel would cost the company about $3 million this year. That’s not pocket change for any business, even a large chain.
Meanwhile, some retailers tried more creative approaches to stockpile pennies before things got desperate. Pennsylvania-based Giant Eagle supermarkets held a one-day event where customers could exchange their pennies for gift cards worth double the value of the coins, allowing the company to collect more pennies to help provide exact change to customers who wish to pay in cash. Sheetz offered free drinks to customers bringing in rolls of pennies. It’s almost amusing watching major corporations beg customers to raid their coin jars.
The Legal Gray Area Nobody Wants to Talk About
Here’s where things get legally complicated. Two-thirds of respondents said they are rounding transactions to the benefit of consumers when pennies are unavailable – a practice that, while fair to shoppers, is costing businesses millions of dollars. They’re doing this partly to avoid potential lawsuits, but there’s no actual federal guidance telling them what they’re allowed to do. There are no official rounding rules in the United States, although H.R.3761, a bill that would allow rounding, was introduced in 1989. That bill never passed. So here we are, decades later, flying blind.
The legal confusion gets worse when you consider SNAP benefits. The shortage is creating a tangle of operational, legal and compliance challenges – especially around SNAP transactions, which require exact pricing, and under federal law, SNAP customers must be charged the same prices as all other shoppers, making rounding up or down legally tricky. Retailers can’t charge SNAP customers different amounts than regular customers, but how do you handle that when you literally cannot provide exact change?
Ten states also ban rounding to the nearest nickel, trade groups warn, making a solution that much more difficult. So depending on where you live, rounding might not even be legal in the first place. Yet businesses have no choice but to do something when they run out of pennies. It’s a regulatory nightmare that shouldn’t exist, but here we are anyway.
Customer Reactions Are All Over the Map
Predictably, people have strong opinions about losing their pennies. McDonald’s new policy seems to be rubbing some customers the wrong way. Social media erupted with complaints when the first rounding signs appeared at locations. Some customers questioned the legality of it all. One Reddit user pointed out the obvious: pennies are still legal tender, so why can’t businesses just use the ones already in circulation?
One customer asked “How am I suppose to donate my [pennies] to Ronald McDonald house?” referring to the donation boxes near some McDonald’s cash registers. That’s actually a fair question. Those charity collection jars have been filled with spare change for decades. What happens to that system when pennies effectively disappear from transactions? Nobody seems to have figured that out yet.
Others took a more pragmatic view. A number of Redditors point out that this has been the way it’s been done in other parts of the world for a while now. Canada eliminated its penny back in 2013, and Canadians adapted just fine. Australia and New Zealand ditched their smallest coins even earlier. Americans aren’t special. We’ll adjust. Still, change is uncomfortable, especially when it literally affects your change.
The Hidden Cost of Cash Itself
Cash was already on its way out before this whole penny crisis started. Cash was the third-most-used payment instrument in 2024, accounting for 14 percent of all consumer payments in the United States and 21.3 percent of all payments that were made in-person. That’s a pretty dramatic shift from just a decade ago. Most people nowadays tap their card or phone without even thinking about it.
The demographics tell an interesting story too. A 2025 Federal Reserve study shows cash transactions in 2024 dropped to only 14% of transactions, with persons aged 55 and older using cash for 19% of transactions, while those aged 18–24 used cash for only 10%. Younger generations simply don’t carry cash. They grew up with Venmo, Apple Pay, and contactless cards. Digging through your wallet for exact change feels archaic to them.
In the U.S., cash usage sits at 16%. We’re not the lowest in the world, but we’re definitely trending toward a cashless society. The vast, vast majority of transactions are not cash anymore, and for those cash ones, retailers can ask customers to bring in their pennies. The problem affects a shrinking portion of transactions, which is probably why the government didn’t think this through more carefully before pulling the plug on penny production.
What This Means for Your Wallet
Let’s be real here. For most people, this won’t matter at all. If you pay with a card, nothing changes. The nearest 5-cent rounding does not impact or apply to card payments or other cashless options. Your total will still be calculated down to the exact cent, and that’s what you’ll pay. Same goes if you use McDonald’s app or any other digital payment method.
But if you’re someone who still prefers paying with cash, you’ll need to get used to a new reality. The U.S. Mint stopped making pennies this month – a move expected to save $56 million annually, but also triggering what the Richmond Fed calls a “rounding tax,” where purchases ending in 3, 4, 8 or 9 cents round up, and the Fed estimates consumers could lose about $6 million a year. That might sound like a lot, but spread across the entire country, it’s pretty minimal for any individual person.
The burden falls hardest on low-income and older Americans. These are the demographics most likely to still rely on cash for everyday purchases. They’re also the groups who can least afford to absorb even small increases in costs. Honestly, that’s the part of this whole situation that bothers me most. The people who’ll feel this policy change are precisely the ones who shouldn’t have to bear that burden.
Why the Nickel Might Be Next
If you think the penny situation is bad, wait until you hear about nickels. In 2024, it cost 13.8 cents to mint a nickel – more than double its face value – resulting in a seigniorage loss of $1.75 for every $1 issued in nickels. That’s actually a worse loss ratio than pennies. The only reason nickels haven’t been eliminated yet is that we produce far fewer of them.
Experts say the nickel’s turn will be next, though they don’t know when that will be, and the last time we got rid of a coin was the halfpenny, which was all the way back in 1857. So maybe it’ll take decades. Maybe it’ll happen next year. Nobody really knows. The Department of Government Efficiency might decide that losing money on nickels is just as wasteful as losing money on pennies.
Removing the nickel would significantly raise the rounding burden on consumers, and in this scenario, merchants would round up transactions ending in 5 or more cents to the nearest dime and round down the rest. That would be a much bigger deal than the penny situation. Rounding to the nearest dime instead of the nearest nickel would affect way more transactions and create larger discrepancies. I think we’ll see significant pushback if that happens.
