CoinStar is a Rip-Off
If you shop at a grocery store or places like Walmart, you’ve likely seen the name Coinstar. These big, green, coin-counting machines promise to turn your water-bottle-full-of-pennies into cold, hard cash–all without the hassle of paper rolls and endless counting. But is the convenience worthwhile, when you take the added expense into account?
Why Use CoinStar?
I distinctly recall helping my parents count out their giant blue water jug full of coins as a child. We had been saving for years and were finally going to use that money on something fun. But first, we needed to count it all out and cash it in at the bank.
My dad brought home a bag full of paper coin wrappers, and we kids set to work. Pennies in stacks of ten, teetering piles of dimes… it was tedious work. But when we were done, my dad loaded the wrapped coins into a box, ran up to the bank, and came back with crisp $20 bills that we then used for a night out at Malibu Grand Prix.
While I have zero interest in hand-rolling hundreds of coins today, the cost involved with using a CoinStar machine has been enough to deter me thus far. After all, do I really want to give up a significant chunk of my money just to have an automated machine count it out? Considering that CoinStar’s fee has crept up over the years–from 9.8% to a shocking 11.9% today–it’s not an insignificant expense.
Why I’m Hesitant
For a whopping 12% of your money, you can bring your coins, have them counted, and receive a voucher to retrieve cash from a cashier or just help pay for your groceries. For most people, this is too high of a fee to warrant the exchange.
If a typical shopper brings in a jar of coins, the total might be $50. They’ll lose $6 in the exchange. A large jar might contain $100. Would you really pay a machine $12 to count your coins–something you could do yourself for free?
Many of these coin-sorting machines are prone to error, too. While you may luck out and get a machine that counts every penny you dump in, you could also get short-changed. And for some people, this could mean as much as 18% of their money goes missing! Add a fee on top of this and it’s just a losing proposition.
Saving Some Change
Luckily, CoinStar has gotten a bit better over the years, offering customers additional options for their converted change and even easing the fee. Depending on what you plan to do with that jug’o’change, these options could make the machines a much more reasonable choice for you.
CoinStar is now partnering with retailers such as Amazon.com and Starbucks. Customers will be able to forgo the 12% fee in exchange for receiving their cash value in gift cards. These partnering retailers agree to pay the fee on behalf of the customers.
If you planned to use the cash to put toward your student loan payment or other bills, a gift card won’t do you much good. However, if you regularly shop with any number of retailers, this is an excellent way to add some flexibility to your budget and also save yourself 12% in fees at the same time.
Alternate Options
There are a few ways that you can convert your coin collection into cash for free. It’ll just take a bit of extra work.
Your first option is to do what my dad did: get the whole family involved and start rolling coins! It may take some time, but it’s also a fun bonding experience, especially if the money-saving effort involved everyone. Most banks will even give you free paper coin wrappers if you ask. Once your coins are rolled, take them to your local bank. They’ll exchange them for cash for you, without charge.
Some banks even offer coin-counting machines for their customers to use. They may charge a small fee or the machines may be free. I’ve also seen where the machines are free to use if you have a modest number of coins (maybe a couple hundred dollars), but they’ll charge those who come in with an excessive quantity. Even if your bank charges a fee for the machine, though, it’s probably less than the 12% being charged by CoinStar.
Is CoinStar Worth It?
There is a time and a place for everything. Using a CoinStar machine to count and convert your saved coins is no different, and there are times when it isn’t such a terrible option.
If you have a lot of coins saved up and can’t (or simply won’t) spend the time counting and rolling them, a machine might be the way to go. This is especially true if you don’t have a local bank or want the convenience of cashing in at the same place you shop for groceries.
If you spend money regularly at any number of retailers–including Amazon–CoinStar might be a great choice for you. After all, you can opt for a gift card in lieu of cash, and avoid the high conversion fee for doing so. In this case, go ahead and bring those pennies with you the next time you head to the store!
CoinStar gets a bad rap for being a pricey machine to use, but let’s be real: companies deserve to be able to offer a service and charge a fee for doing so. CoinStar’s business is successful in spite of its fee, which has crept up over the past few years. Obviously people–those who are aware they are paying a fee–are willing to pay it and find the service worthwhile.
However, what I propose is considering the less expensive options first, whether measured by time or money, in order to get the same results. If you’ve already looked into the options and have decided an 11.9% fee makes sense for you, then CoinStar is ready and waiting at any one of their 20,000 locations nationwide.
Article comments
I find its a choice of time vs. money. I can get more money but the hours I would have wasted counting the 6000+ coins I just recently put into one of a similar machine at the grocery store, I could never get back. The fees are bit high but that’s the cost of doing business roll in at the customers choice to use or not. Its a genius business Idea hence the company was savvy enough to makes millions.
I found my bank( one of largest) will accept coins, but charged fee. And wanted me to leave coins until they had time count them. With coin counting machine. And would deposit that amount later in my account. No thanks, worth it to use coin star machine
My time is worth far more than the 10% fee. I can make more money doing other things than rolling coin to make up for the money lost on the fee.
Saving $50 makes no sense when you could have earned $100 in that time.
Value your time properly!
So, who do you think is going to count your jar of change for free? I don’t want to count it myself, so I’m fine with paying someone to do it for me.
Coinstar charges a 9.8% fee now? That’s lower than what it used to be. That’s why they don’t TELL you the charge on the console, they just let you find out AFTER you put your money in that you’ve just been screwed… it should at least give you a cigarette.
Very hard to find banks that will take your coin unwrapped. My Mom worked in a bank for years. She said the machines were always breaking down and very expensive to fix. Sometimes people would leave nails, etc. in their jars, etc., but nails weren’t the only reason machines malfunctioned. Taking all that into account, it makes sense why the banks are getting rid of the machines altogether. And given the malfunctioning aspect, you have to wonder if the count is even correct. I wish our country would get rid of coin altogether
Coinstar prints their receipts on thermal paper, upon which the ink completely disappears over time. I was able to read only the date and time (to the second) that my receipt was printed, provided the location that we gave them our money and, shockingly, they were unable to verify that transaction. So, they now have our money and no motivation whatsoever to fix the problem. That part of their business is where the scam is.
I used coinstar today that offers cash to be loaded into a paypal account , like a deposit. I deposited 250.00 for my kid who is traveling tomorrow and did not want her to carry cash for safety reasons. after depositing all the money and linking it to my paypal account out spits a receipt that we could not deposit your money call customer service. So all 250.00 is inside your machine. Cust service answer is 7-10 days for a refund check to be sent. WTF ….. total scam. so how is my daughter supposed to have her money for tomorrow????? How many people do you do this to and hold their funds for 7-10 days nationwide and collect interest on ?????? Avoid CONStar/ Paypal at all cost, just get a gift card I guess is the lesson from VISA or AMEX ! !!
I use coinstar occasionally – my time is worth more than the lousy 10% they charge – yes – I could do it myself, but can I count $50.oo worth or pennies in two minutes – They are making a living like the rest of us – it is a convenience – which we must pay for.
No, they are making a KILLING by hiding the price.
Look at the console, it does NOT tell you how much they keep; you only find out afterward, when it’s too late to get your money back!
That is FRAUD BY DECEPTION.
This person must not be aware of debit card and credit card fees and such. There are always costs associated with transactions, it’s just a matter of who pays the cost.
When i use coinstar, first i remove all quarters. I keep the quarters and use them on small transactions. Counting out 8 quarters is a lot less annoying than counting an entire bag of coins when trying to buy something with coins.
If you have a jar of coins, quarters can easily account for 60-80% or more of the monetary value of the coins in that jar. Once you remove the quarters, you reduce the fee you pay by that 60-80%, which makes it quite reasonable. If you wanted to take it even further, you could separate the dimes or nickels out as well.
If you wanted to create a system, you could have a jar of assorted coins which you periodically separated into coin specific jars.
In terms of time value and opportunity cost, if it takes you 1 second per coin to reduce the transaction fee from 10% to zero, then counting pennies is worth $3.60/hr, counting nickels is worth $18.00/hr, dimes $36.00/hr, and quarters $90/hr. (btw picking up pennies is worth $36.00/hr)
So given these numbers, Coinstar really is a ripoff, but it’s not a ripoff because coins are real money, it’s a ripoff because the effort savings of using coinstar are not worth the cost of the transactions fees that they charge, except for pennies.
People keep too much change, Coinstar’s exhorbitant fees taught me to use exact change in transactions rather than just throwing the coins in storage.
For those of you talking about bank fees, corner stores are almost always willing to swap your coins for paper money.
Me and my cousin tried a *Coinstar* machine at the New Super Walmart in Sun Prairie, WI.
It was our first time so we didn’t really expect much to happen. We brought about a good 10-25 pound coin bag with us. After reading the Terms and Agreement or whatever that says it would take off 9.8% for every $1 made. After getting up to about $95 in coins, the machine died -__-‘
WTF ?!? And im sure there were at least 30 quarters in there, but it indicated 2 quarters… ?! -.-‘
*DO NOT USE COiNSTAR IF YOU VALUE COINS !!!* lol
I remember as a kid seeing the commercial of coinstar( the fairy had a huge bag a change and one evening dropped the whole bag of change on the stairs, so she went to coinstar) you can actually transfer your coins to cash? some people say it’s a rip off but when your in a tough situation you’ll try anything that sounds goods. I’m in a tough situation I don’t have enough to pay for my new state id licencse.
You’d have to be pretty hard-up to pay 90 cents on the dollar for change to bills. Sounds like an electronic “quick-change artist.”
I used a Coinstar Machine today here in Hawaii. But I didn’t throw in a random amount of coins. I had actually counted out the coins in order to put them into those old school paper rolls. When I went to the bank to get some of those rolls I saw a Coinstar machine (my bank but I was in a different town) so I decided to put it in there. I had $24 in quarters, $19 in dimes, $16 in nickels, and $11 in pennies. When I ran them through the machine it said I had 62$ not counting some of the coins it wouldn’t accept and the % they take (I was taking cash)
This article (and many of the comments) overlooks something pretty simple. My time is worth much more than the fee charged by Coinstar. You might want to waste an entire Saturday (or even an hour) counting change. But I don’t want to. Nor do I want to make a separate trip to the bank to get cash for change. The business model is doomed as young people today use electronic payment nearly exclusively, however in the meantime, I’ll gladly pay $5 for $95 in cash. This only doesn’t make sense if you’re a minimum wage worker, in which case, you probably don’t have $100 sitting in a jar. Worry about yourself, if you don’t like the fees, just drop your change off at the charity of your choice and stop your bellyaching.
its so ridiculous, i put in 99 dimes and it was willing to give me only $8.75 back -_-. how in the world is 8.9% of $9.90 = $8.75?! on top of that, the machine decided to shut down on me, and took my freaking 9 dollars! now ill have to wait 24-48 hours for it to give me back my ripped off money back -_-… NEVER EVER going to be using anything like coinstar EVER again.
Coinstar is not a ripoff. If they tell you right up front what the conditions are and you agree to them, it is not a ripoff.
I have counted and rolled coins before, even had a little gadget to help. I HATED it!
I happily use a Coinstar machine in our grocery star so it’s not even a separate trip. I use the Amazon option and therefor don’t pay a thing. Of course Amazon (or whoever) must be paying them something.
I would even be more than willing to pay 10%.
I love the service and it’s a little rude to tell people who don’t do it your way that they are fools.
It’s a great idea and I congratulate the guy who thought it up and developed it. Americana at it’s best.
I would like to be able to put my coins into the machine and have the amount go towards paying my CC bills. I don’t mind paying a SMALL fee. And I mean small pennies on the dollar.
You people claiming that 1 cent is worth 2 or 3 cents are correct, however
it’s a crime to melt them down. To the guy in the small hick town, why not simply
open up an acct. at the local bank. I swear some people are so cheap it amazes me.
Just wanted to pop by and state to the tight fisted fella, that yes 8.9% of the change counted is taken, however not only does it provide a quick and easy solution to removing lose change, it also helps contribute to some of the worlds charities like cancer research and children in need making a real difference to people’s lives.
the machine states that you will be losing a percentage and the buyer then has the option to proceed
And they are getting pre 1982 pennies worth 2 cents.
Taking the time to roll coins can be done in a slow down time. It’s a close to mindless activity so you can listen to the news while doing it. i have begun to save my change. Who knows when a person will need it.
Anyone that thinks Coinstar or any other company will dish out money to build a machine and allow you to use it without charge is absurd.It appears everybody wants something for nothing nowdays.Its like anything elase in this world, you pay for convenience. For many its well worth not to have to spend the time and effort to count and roll.If your too cheap and have a luxury of a lot of spare time,than count and roll your own change and take it to the bank. You forgot to mention there are many local banks that provide Coinstar or change counting macine service to their account holders free of charge and do not take any percentage of the money .
Who has time to roll coins? I’ve found CoinStar a Very useful tool; no fee if you take the ecards. Don’t we all shop online these days! Vw
I hate Coinstar but am finding little other choice.
I moved to a small hick town recently.
The Banks wouldn’t accept any of my rolled coins unless i had an account and the stores wouldn’t take them at all. They just flat out said No.
CoinStar has a monopoly on loose change, hell, even rolled change. I have no problem rolling the change myself, but no one will even take it any more. Coinstar owns coins here..
Not only are you a fool for paying for this fleecing but all the pre 1982 pennies your dumping into this machine are worth 3 cents in copper.
My question is how do I get some of these machines myself?I’ll take all of your copper and your coins for 5% you lazy bastards.
I use coinstar, but never redeem in cash. The 10% fee is too much. I always get the amazon gift card at face value. I buy a lot of stuff on amazon, so to me, its the same as cash.
I just found this article through a Google search. I just posted a similar article about this up on my blog, and I listed some other ways to use your loose change before you waste it on Coinstar. It’s amazing because they also take 7.5% off the top even when you turn in your change for a charitable donation, which I find ridiculous.
I don’t see any issue with TD Bank charging non-customers to use their counting machine. That machine is a valuable service that saves their customer’s time, and it costs the bank money to purchase and maintain the coin system. If they didn’t charge then people might run to their machines instead of Coinstar and TD Bank’s account holders would be flipping the bill (and waiting in line) for it.
I wish my grocery store would offer this service. My husband and I put our spare change in a big coffee can and it’s nearly full again. Full is usually between $250 and $300. That would be my grocery budget for the month and a grocery gift card would be wonderful! I haven’t used TDBank since last summer and at that time there was no fee for non-customers. I guess from what you’re saying, they are charging non-customers now. Too bad.
People are willing to pay a fee for the convenience, since some are too busy to count/sort the change and go to a bank. Is it a ripoff though? It’s more of a savvy business idea. If I buy a car for $2k and sell it for $3k I’m not ripping that person off.
i am with flexo on this one, personally, i think the service is a rip-off. i would rather take the time than just lose 10% of my money. perhaps the time is not worth it for some people, but for me it is. that said, i can see the value in dropping the coins in and getting “credit” from a retailer you would use anyway, but there is still the possible “error loss” of using the machine. if they provided a bonus in addition to simply eliminating the processing fee, perhaps i could be convinced to use the service. perhaps.
I agree with Flexo, the service is not really worth the fee. I have always thought that they were a rip-off. Then again my credit union has a coin machine I can use for free. Even if they didn’t I’d just roll it myself like I did before.
Is this any different than people who pay ATM fees?
Some people don’t have bank accounts, therefore pay to have a grocery store or walmart cash their checks or even the bank it was drawn on.
Some people are embarased to use coins – the fee is worth it to their pride.
Many credit unions will count the coins for you for free if you deposit them into your account. I just take a jar or bag full and hand it over to the teller.
I fall into camp Coinstar! I’m happy to pay $9.80 rather than count up $100 worth of coins in my free time – wait, I don’t have any free time.
With the Amazon option, you can’t go wrong. I can buy diapers, my kid’s school uniform pants, Brita water filters, Christmas presents, I’ve never had trouble finding something to use the gift card for.
Plus, coins are dirty. 🙂
Honestly, Coinstar doesn’t work well, If any coins are “defective” it spits them back out and often it will count the dimes for pennies(extra rip off) so plus the fee, no thanks. I’ll count them myself and take them to my credit union where they’ll take them. 🙂
This post is like watching an episode of Seinfeld, except even more amusing and informative 😉
I should have started the article off with, “What is the deal with CoinStar machines?!” My Seinfeld impression isn’t very good, though. I just tried it out loud.
I love the back and forth of opposite opinions created by this post! I wish we had more posts that caused this type of reaction from the readers of this blog. Great job, Flexo!
I like counting coins when I’m sitting watching tv, so counting them isn’t a big deal. I don’t have a bank nearby so I find someone willing to take the coins and have them write me a check.
I’ve used coinstar before and it was relatively convenient, but I’d still rather do it myself, especially since I only roll coins once every two years or so and it’s usually less than $50.
Great post! Inspired me to swing by a bank on the way home and pick up some free coin wrappers and count up my change. Here’s to a found $50 cache of coins I had in the change jar.
“Nobody ever went broke underestimating the intelligence of the American public.”
H. L. Mencken
Or the sloth of some of them.
I went to use CoinStar only once — when they had the $10 amazon bonus in the winter. I had the coins separated into $40-ish piles ($10 extra for $40). It turned out they were unable to give me amazon gift cards (not sure why), so they gave me cash instead — no fee — and I still got the $10 codes for amazon over the phone a few days later. Sweet!
Central Jersey Bank has free machines for customers. If you don’t have an account where the bank counts for free…..ask a friend who does to take in your coins. CJB will not accept wrapped coins since they have machines. I also have a little coin caddy(dollar store item) where the cylinder indicates to you that you have the amount for the coin wrapper. Pay Coinstar—-no way!
Don’t use cash. Problem solved 🙂
I’m in the wrong business.
The bank weighs the coin roll to make sure it has the correct weight for the number of coins that should be in the roll.
However, not all banks take rolls for free from non-customers. Currently we don’t pay a teller fee at our bank, but once we’re forced to, we’ll likely switch to getting Amazon cards from a Coinstar machine. We shop at Amazon regularly enough that it’s a decent deal.
Of course, we also keep some change around for parking meters. 🙂
I wanted to note that most banks will NOT accept rolled coins. It would be way too easy to make a roll of coins look real.
I haven’t done a study, but every bank I’ve brought coins to, other than TD Bank/Commerce Bank that pointed me to the coin counting machine, accepted rolled coins. When asked, they preferred rolled coins over loose coins, and did so without opening the rolls. I believe they placed the coins in a tray that was used to check the size of the roll, then verified the weight of the rolls using a scale. I suppose they also had my account number so if they later found I short-changed them, they would be able to debit my account, but I can’t be certain.
You have to have an account with the bank if you want them to accept your coin. Many banks no longer have you put your account number on each roll either.
Steve
They weight them to make sure they’re fine. Even if you put effort into faking it, you probably would waste more time trying to get the right amount for a few bucks, and you’d still be on all the camera’s so you’d be caught.
Well I worked for a national bank, and the fraud department enforced that we break all rolls open and have the machine count them.
As we never accepted rolls of coins we never would associate an account number with a cash exchange transaction.
9.8% does sound a little steep, but on the other hands I recently had about $120 worth of coins and I would never dream of counting it by hand. The CoinStar fee was a small price to pay in that situation. I just don’t like counting coins.
They let me easily donate to my favourite charity (WWF) without any fees. This is the only reason I use their service.
I wonder how much WWF is paying CoinStar to accept donations at their machines. It may be a percentage of your donation. That being said, I often donate to charity using a credit card, and the charity is most likely charged by a payment processor for that as well. I do think it’s great that CoinStar offers this type of charitable opportunity, but someone is paying for it. A standard credit card processing fee (for VISA via electronic “card not present” transaction) is 1.8% plus $0.10 for each transaction; WWF may be paying 5% to 9.8% for your CoinStar donation if they don’t charge you a fee.
All fund raising has inherent costs. Some charities pay large sums (20-50%) of the donated amounts for people to knock on doors for them. WWF does the math and says “Hey, we are getting 90% from Coinstar but that’s better than 0% if they don’t contribute, and it’s competitive with what we pay elsewhere to raise money”.
It completely makes sense from a charity’s perspective! Absolutely. There is no denying that any charity would receive more contributions by finding creative ways to make it easier for people to donate. From a personal perspective, the point of view of a consumer or contributor who is already planning to donate, I try to give in such a way that my contribution — a fixed amount — is used as fully as possible by the organization, not spent on fees. I don’t know the arrangement between CoinStar and WWF, but when I donate $100, the organization most likely gets to keep a larger percentage if I pay by credit card, an even larger percentage if I send a check, and almost 100% of my contribution if I can donate via ACH.
Rolling coins? CoinStar? Bank machines? Amazon gift cards? You young guys should just wait awhile for your money …. if you can. Afterall that’s what grandkids are for! As for the charges? A couple Candy Bars at the most 😉
It costs me $2.00 every time I talk to a teller at my bank. Definitely cheaper to hit Coinstar every once in awhile.
Yikes! That’s another case against stupid fees… just in your case, it’s a stupid bank fee rather than a stupid CoinStar fee. More banks may be doing this now, but there are still free alternatives. Find a bank that doesn’t nickel-and-dime you. Of course, most people are content to let these fees show up and increase — I believe CoinStar’s fee was “only” 6% a few years ago — and that’s what they count on to continue to operate, providing the same services at roughly the same business cost…
I agree with the posters above that if you use coinstar to acquire amazon or other retail gift cards then it is not a bad option. I didn’t even realize they offered gift cards and I will now check them out since I use Amazon to buy music other items often.
I remain bitter after my one CoinStar experience. I wanted to get an Amazon certificate to avoid the fees. It was only after depositing my coins into the machine (and got an accurate count; I had estimated the amount beforehand) that the machine indicated that it wasn’t dispensing Amazon credit–despite the fact that I had indicated BEFORE depositing coins that I wanted it. So I wound up getting cash and losing that 9.8%.
Barb, that is too bad. You should have called Coinstar directly and they would have gladly refunded your money.
I have accounts at two banks and neither will “gladly do it for free.” In fact they require me to roll the coins and put my account number on each roll which takes time that I’d rather not spend. I am surprised that no one else is trying to undercut CoinStar – especially banks. Why doesn’t my bank offer to do it for 3% or 4%? They’ve got the counting machine already.
But is 9.8% a rip-off? Apparently not judging by CoinStar’s earnings over the last 13 years. Enough people must be willing to pay the fee rather than deal with the inconvenience to support a very profitable business.
You could buy 100 shares of their stock to (hopefully) offset the fee, though…
That’s a great point. Given the public’s proclivity to pay for services like this and CoinStar’s success, you could certainly cash in by buying their stock, hoping to get an average annual return better than 9.8%.
for sure.
This article assumes people’s time is worth nothing or close to it. How long would it take the average person to sort the average $100 jar of coins? My bet is it would take far longer than an hour, but just for the sake of argument lets call it an hour. So, I would pay ~$10 to save myself an hour of work. Since my time is worth far more than $10/hr to me, it is a good deal. I’d call it a great deal when Amazon pays my fee, since I purchase from Amazon at least monthly. Poorly thought out topic by the author, why would anyone pay for any services using his premises? Shame on consumerism commentary for posting such a low quality article.
I’ll gladly take any coins you have and give you less money than their worth in return. Many fees are worthwhile; others, like a 9.8% fee for counting money — either unnecessary or possible for free, less so.
In order to take his coins in exchange for less money, you would need to:
(1) Contact him and set up a meeting time and place;
(2) Agree on a rate of exchange;
(3) Travel to the meeting place;
(4) Travel from the meeting place;
(5) Roll the change yourself; and
(6) Bring the change to the bank for deposit.
All of these steps take time and energy. Some of them also cost money if you are driving a car. I’m still not seeing how coinstar is always a rip-off. For some people it might make a lot of sense.
Categorically calling it a rip-off is pretty bold. If I wanted to give a friend a $25 iTunes gift card (for helping me or for a birthday) – should I roll up my change and head to the bank? Or would it make sense to use coinstar and get the gift card?
Heh. OK, in that instance it would be quite a chore. But if someone I interact with daily were wiling to hand me change in exchange for less money in paper, it would be a no-brainer for me. To your other point — if your intent is to buy a $25 gift card for iTunes, it certainly makes sense to go to where you can get that gift card for $25 — or even less. I am not a super-frugal type of person. I don’t think it makes sense to save every cent at the expense of other things in life. I do have a problem with the way service fees creep in and creep up, when free alternatives exist, and exist without the benefit of marketing teams, advertising consultants, and corporate partnerships, thus leading people not to consider these free alternatives.
As I outlined in my comments above, none of the options for trading in coins are free. One option costs time, the other costs money. I attempted to do some rudimentary math above to illustrate the point that the money value of time is important in calculating the value of a transaction, but it seems lost on you. If you are willing to perform this service for a lower fee than CoinStar, as you say you will do gladly, perhaps you should start doing so rather than writing uninformed articles on subjects you clearly have no understanding of.
Time = Money. Coinstar saves you time, but costs you money. Determining whether a time for money exchange is a “rip off” for one party requires knowledge of how much time is worth in terms of money for both parties.
AB: I’m well aware of the value of time. You’re quite free to spend your money as you see fit. Perhaps you have no opportunities to have the same service performed for you, at roughly the same level of convenience, for free. Maybe you’ve looked into this issue before. I don’t know your unique circumstances. I do think 9.8% is too steep a price to pay for a service with many less expensive (in terms of money and time) alternatives available with barely any effort. Most people will blindly pay these fees without consideration of alternatives. In fact, some customers aren’t even aware that CoinStar charges a fee, and even after looking at their receipt, they still may not even realize a fee has been charged. It’s worth raising the issue, and I have no problem with dissenting opinions.
If you plan ahead the time it takes to organize your coins is minimum. You can have paper wrappers set up for each type of coin and you accumulate the coins inside the wrappers instead of accumulating all inside a jar. The time it takes to bring these wrappers to your bank is the same time it takes to to bring them to a coin star. Besides, the time=money argument sometimes is taken to extremes, we all have idle times during the day when we are basically doing nothing productive (watching TV, taking a nap, talking to a friend, etc). At least I don’t make money watching TV, that is time I could very well spend organizing my coins and saving $10 or more in the process. Bottom line, I agree with Flexo.
Same analogy Flexo. I’ll gladly take your money and give you a sandwich, that I made, that contains ingredients worth less than you give me. Thing is, i’ll be marking it up a lot more than 10%!
It is a service. Not one i’d pay for either, but some will – obviously. The extreme frugalists will never buy a sandwich, they’ll always make it at home. Same bread, meat, veg and cheese as the store you could buy a similar product. Those frugalists will also roll their own coins instead of having a machine take 10% to provide them a similar service.
Thing is Flexo, is Starbucks a rip off? $5 for a coffee you can make yourself for $0.30?
Is a restauart a rip off? $20 for a pub style fish and chips when you can make the same for $3 at home?
You’re paying for a service just like any other service. When you opt to pay instead of do it yourself you are assigning value to your time (and perhaps skills).
Sure, 10% seems like a lot but in a society like North America where we pay for so-so or even sub par service and then TIP 10% to the sub-par service provider out of a feeling we “have to” or “they don’t get paid much, top ’em up”, this particular “rip off” doesn’t seem all that bad.
Reminds me of Flexo’s postings about lunch:
“For several years, I traveled out of the office almost every day with co-workers to buy lunch at a variety of local quick and unhealthy restaurant options. Later on, I opted for lunch from the office cafeteria, which was often just as expensive as dining out, but possibly healthier. This was a fairly expensive habit, sometimes about $50 a week.” -2/13/11
Interesting analogy, but I don’t agree. You could make the same fish and chips at home, but it’s not necessarily really the same. One goes to a restaurant because they like either the food (it’s unique or well-prepared), the experience, or the convenience. The only thing CoinStar has going for it is convenience. Often, you could be even more accurate (or “well-prepared”) doing it yourself. Is the convenience worth it? Maybe for some, but I don’t think it should be, when other options are often just as convenient but free. I understand it’s not always just as convenient, but all it takes is some smart planning. If you have buckets of coins to count? Well, I wouldn’t do that myself, but I would still choose free options over CoinStar.
I agree with Steve. I have used CoinStar several times; I just wait until I need to get something from a merchant on their gift card list, then take my coins and exchange them for a voucher for the merchant I choose. My kids like it because, as Steve mentioned above, they download a lot of stuff off iTunes and would be spending the money anyway. This way, they save their change and turn it into something they actually need or want.
Counting and rolling up a lot of coins does take time. If used wisely, the CoinStar machines can be a good thing.
I’ve only used coin counters a few times. Once was at a bank where the teller tried to sell me on opening an account when I cashed the receipt. I’ve used coinstar a couple of times – including receiving a gift card (Lowes, I believe) for my coins. I felt the transactions were pretty easy and straightforward (I don’t think the machine short-changed me (no pun intended) but it did reject a few coins repeatedly).
I think your post leaves out a couple of parts of the discussion on whether or not to use a coin counter. One is the actual cost of going to the bank (gas, parking/metro/bus). You recommend going to the bank twice. Once for the wrappers and a second time with your coins. While some people walk or combine trips, a lot of other folks drive and two trips to the bank costs gas money even if combined with other trips.
The other issue is the opportunity cost of someone’s time. Counting and rolling up coins yourself does take time and that is time you could have spent doing something else (which could be working or could be exercise, spending time with family, etc).
I’m just not sold on the idea that coinstar is a rip-off in all situations. For someone who downloads a lot of songs from iTunes or orders from Amazon, it could work out well as they would already be spending that money anyway.
Just thought I’d mention you don’t even need coin wrappers to wrap your own coins. Banks will accept coins rolled in whatever paper you have lying around – as long as they’re rolled in the typical amounts (i.e. $10 for quarters, $5 for dimes, $2 for nickels, and 50 cents for pennies. I just rolled $27 worth of coins in lined paper and the teller had no problem giving me cash for them.
Your experience is rare! Banks do charge because it takes time. Banks will do anything to move you out of the lobby, because it costs them $ 2.25 for every tranaction handled by a teller. $.12 for every transaction handled through online banking and $29 per transaction via ATM…
Error….$.29 per transaction via ATM
The bank I worked at actually encouraged people NOT to roll their own coins, because it required us (the tellers) to sort them by hand and have the machine re-roll them. This wasn’t just the bank being paranoid–a lot of the rolled “coins” we received had rolled up coin-like objects or foreign coins inserted with legitimate U.S. currency.
I don’t keep loose change around anymore but it’s not my experience that “any bank will gladly do it for you for free.” The banks that I’ve tried require your account number on each roll and I haven’t even asked for paper rollers in more than a decade because they would never give them out.
Even if you could get the wrappers for free AND had a bank willing to make the exchange, it’s not a waste of money if you value the time that would be spent counting and rolling at more than 9.8%.
Neither my bank nor my credit union will accept rolls of coins for free. Both charge a fee to exchange already rolled coins for cash, or just to deposit them, even when I have an account at both.
I used Coinstar last year when there was a promotion that gave an extra $10 at Amazon for every $40 you cashed in, with no fees. Otherwise, I just spend coins as cash while I’m shopping and avoid the whole cashing in trouble.
Sounds like you need to get a new bank. Coins are legal currency, for a bank to charge you to accept them is ridiculous.
i’ve never used coinstar so i have no personal experience.
Then why comment? I’m looking for opinions, not “i don’t know, i’ve never used it’. WTF?
And why exactly did you (AnnieMack) comment now? To add move value to the discussion? I figured I’d one-up you. Cheers!
I used to find coinstar pretty convenient. I haven’t seen any coin counting machine at my bank (BoA), so that’s not an option. The one I had access to would waive the fee if you got the money as an Amazon gift card. I use Amazon fairly often, so that was great for me. I tended to think of it as a way I could treat myself, since coins sitting around in a jar were not part of my budget 😀
Totally agree here, although it should be noted that they sometimes do things where you actually get 10% extra by getting say an amazon gift certificate instead of cash. In that case, it’s a no brainer (assuming you would be buying something from amazon anyway). Even if the machine is off by 5% you still come out way ahead (who wouldn’t take a 5% instant payoff). Of course they usually limit these things – otherwise you could have the gov’t ship you free dollar coins, get your rewards points, then toss them into coinstar and reap even more rewards:)
Juggler, I think Flexo is saying that the Coinstar machines are often off, but this goes both ways and you could easily end up losing money.
That’s not what I’d say – his two lead paragraphs espouse on not paying someone (coinstar) to count money for you…he then said as an addition that the machines are often off, so it could be even worse. Then he points out that coins are real money…not needing to be changed in, and if you want to do so, just go to the bank and get paper money in exchange.
What I said was that there are deals where you make out even if the machine is off. Which, I thought, was a decent reply to an article telling you never to use the machines.
Your reply to my comment both summed up his original article badly and also doesn’t really make any sense considering what I actually said. Also I started out by totally agreeing with Flexo…and added that there are times when it can make sense. Did you read the entire original post or my reply?
Oh, I’m sorry – I misunderstood your comment. I thought you were saying 10% extra based on the fact that Coinstar doesn’t take a percentage when you get a gift card in return (thought you were just rounding the numbers and calling it “extra”). I see what you mean now, and agree that if you have a need for the gift card then Coinstar is the easiest way to go. I had no idea they sometimes give you 10% more than what you actually put in for gift cards – that’s an even better deal!
Of course even though it’s a good deal I didn’t partake. I felt the $20 max (so $2 match) on 6 merchants wasn’t worth my time. Having to go to a coinstar, bring the coins, then find ways to use the various things that don’t make it not worth it…
I read a lot of “frugal” blogs and such things…(where I heard this tip the first time), but a lot of these tips…just don’t seem worth it. Maybe that’s why I’m nowhere near being a millionaire though!