Throughout recent American history, the metals used by the U.S. Mint to create coins for circulation have increased in value relative to the currency. As a result, at certain points, the Mint changed the metal composition of coins to ensure the government would still make money on production. In 1982, when the amount of copper contained in a cent was valued over $0.01, the Mint replaced copper with zinc. Today, the copper in these pre-1982 cents is worth $0.027 by weight. The metal composition of a nickel is worth $0.062, a smaller premium over the face value. It’s safe to expect the Mint will eventually change the composition of the nickel so the government makes money on each nickel minted.
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These nickels and pre-1982 cents are still in wide circulation.
Collecting — or even hoarding — these coins may seem crazy, but if your parents or grandparents held onto silver dollars, half-dollars, and quarter-dollars after the composition of these items shifted to more affordable alloys, you might have inherited coins now deemed to be valuable. The value is due not only to the value of the metal, but if the coins are in exceptional condition or are rare, they’ll have an additional value to collectors above the value of the metal.
If you have the space, consider holding onto these coins when you find them. There are a few things that could happen when you do:
- The government will change composition on the coins to keep them more affordable, and demand among collectors will increase for the coins with the older composition. If you stay ahead of this curve, it could pay off. Supply will never increase.
- The government will begin to allow melting of copper and nickel. This will decrease supply because many collectors will prefer to melt and cash in their investment. The coins that aren’t melted will increase in value as their rarity increases.
- The government could decide to cease minting cents and nickels altogether, as the value of $0.05 continues to play a smaller role in everyday personal economics. Cents and nickels will be removed from circulation, increasing the value of those that remain among collectors.
It seems that in every possible future situation, it make sense to start holding onto coins whose base metal value exceeds the face value and market value. Holding onto silver coins when the government moved away from using silver in circulating coins seemed unlikely to pay off at the time. With silver at $35 an ounce today rather than $1, and with the best specimens of silver coins potentially having a much higher value to collectors than $35 an ounce, many collectors wish they had maintained a better silver collection in the 1960s.
Coinflation lists the base metal values for coins. Here they are, as of June 2, 2011:
| Description | Denomination | Metal Value | Metal % of Denomination |
|---|---|---|---|
| 1909-1982 Cent (95% copper) | $0.01 | $0.0270840 | 270.84% |
| 1946-2011 Nickel | $0.05 | $0.0623513 | 124.70% |
| 1982-2011 Cent (97.5% zinc) | $0.01 | $0.0059563 | 59.56% |
| 1965-2011 Dime | $0.10 | $0.0231098 | 23.10% |
| 1965-2011 Quarter | $0.25 | $0.0577769 | 23.11% |
| 1971-2011 Half Dollar | $0.50 | $0.1155549 | 23.11% |
| 1971-1978 Eisenhower Dollar | $1.00 | $0.2311110 | 23.11% |
| 1979-1981, 1999 SBA Dollar | $1.00 | $0.0825388 | 8.25% |
| 2000-2011 Sacagawea Dollar | $1.00 | $0.0706778 | 7.06% |
| 2007-2011 Presidential Dollar | $1.00 | $0.0706778 | 7.06% |
Any coin with a metal percent of denomination over 100% is worth more as a metal than as a coin. If you have the space, consider holding onto the pre-1982 copper cents, and perhaps nickels, to take advantage of what time will do to their values if silver’s history is any indication.
Photo: stevendepolo
Updated October 16, 2015 and originally published June 3, 2011.
{ 18 comments… read them below or add one }
I wish I had known this when I was a cashier! I used to go through the quarters to check for old silver ones when business was slow!
Flexo, you have made my day…my mom has “bequeathed” to me and my children, a fairly worthless collection of coins minted in Liberia. As smart as she is, she is so gullible when it comes to coin collecting and can’t pass up these informercial offers of “rare, collectible coins”. I’ve tried to tell her that she needs to look for coins MINTED IN THE U.S. but my cries seem to fall on deaf ears. LOL
Not only am I going to email her the link to this post, but also send a copy through snail mail so she can carry it with her when she’s ‘shopping’ for coins.
…and, if anyone knows where I can off-load some Liberian coins with pretty pictures of eagles, polar bears and dead Presidents…
Just a quick note – it’s illegal to melt down coins for the metal. So while silver is collectible based on intrinsic value, I don’t think copper pennies or nickels are worth the effort. You would first have to find someone wiling to buy them and melt them down (and break the law), then you would need thousands of them for it to be worth anyone’s time.
The legalities are a bit murky when it comes to melting down… U.S. code says altering is illegal only if done fraudulently, to misrepresent the metal as anything other than an altered coin. But I’m not recommending melting, anyway. There’s nothing about silver that makes it value “more special” than the value of copper — intrinsic value is the value of the metal, the same concept whether it’s silver or copper. The price is based on what people will pay (influenced strongly by commodities traders.) It’s the same concept whether it’s gold, silver, or copper…
If potential buyers are reluctant to buy because of the potential illegality, that may prevent a run-up in price… but if the price increase is steady, there will eventually be enough backlash (just like there was with other metals) to allow melting.
From what I understand. the same arguments (inconvenient to melt, not worth the effort like gold would be, etc.) were made about silver when the government changed the composition of coins that contained silver, and those who held onto silver coins (many decades later) have benefited.
you have probably done more research on this than have i, but from what i gathered on some coin/bullion forums that i frequent, the members there talk about it as if it is flat out illegal to melt them just for the metal content. great post though. it has inspired me to look into it.
Ryan, specifically what law are you referring to—i have not been able to find one. I did find wher you couldn’t deface coins, implicating creating a fradulent coin, but not any law against the melting of the coin.
How would you make any money besides melting them down?
By selling to other collectors or dealers.
they have been selling on ebay for some time.
This is great information. I knew that the price of copper was such that the pennies were worth more but didn’t know the exact date. Now I can go through the penny jar and pick out all the right ones. A few months ago when I was rolling dimes, I found one from 1964 made of silver. Needless to say, I set it aside.
great post flexo….but shhhhhhhhhhh! we do not need this getting around. it is bad enough i have found about 2 pieces of silver in the past 2 years, soon copper will be scarce as well when the masses get to this.
100 old copper pennies are worth $1.00 at face value and $2.71 in copper content. For a possible future profit based on metal content of only $1.71, I think I’ll pass. Collecting them would be too much work. It would give new meaning to the term “penny pincher”.
In the past I’ve found several silver dimes in the rejected-coin cup on Coinstar machines. They’re not “read” correctly by the machine and thus get spit out. The machine now lets users know that coins have fallen out.
However, in the Coinstar’s terms of service section online it tells you that the machine might not give back certain coins — including silver ones. I read a comment on another blog about a guy who knew a guy who was a Coinstar tech and would keep the coins he found when he serviced the machine. Hmmm. I wonder if his supervisor knows that? And I wonder how many techs turn in these silver coins, and how much they add up to in a year?
A relative of mine was a supermarket cashier and then customer-service manager. Whenever she saw older coins turned in she’d scoop them out and replace them with money from her wallet. She’s saving them for her kids.
I have quite a few coins from my birth year ,which is well before 1982. I never collected them for anything other than the fact that they were minted the year I was born. In high school we had to do a project presenting different things that happened the year you were born and this got me started. Thnik I may just keep a lot more pre-1982 coins. Like you say, I have the room and what will it hurt?
I had a feeling about this. It reminds me of people hoarding pennies back in the day. Great info. Better start searching for those 95% copper pennies and nickels. Logical points on why the value will go up. Is there a scenario where these coins could go down in value? Almost sounds like a sure thing, but you know what they say about sure things.
Depends on how you’re collecting them. If you just sort through your change every so often and pick out the goods ones, then there’s no risk at all. Say the metal market crashes, and there’s only $0.001 worth of copper in the pennies. Well you’ll still be able to spend them as a penny no matter what. Of course there is the opportunity cost. If you manage to get significant amounts of money you might be better off investing it, than hoarding it as pennies.
Now if you’re buying and selling from collectors, then you’re paying for their collectible and bullion value. So if the metal takes a dive, you lose money down to the face value. And if there’s collectible value (e.g. out of print collectible coins) they can lose that value from loss in rarity (mint starts reprinting, someone discovers a stash of them), and their condition being degraded (if you scuff them, or over handle them).
I actually had a friend who, when her father passed away inherited his ‘junk’. None of her siblings wanted anything to do with anything from their dad. She just stored it all in her garage.
One day when I was over there I was helping her clean out her garage and we came across his few suitcases of things. When we went through them we found some really rare coins.
She knew he collected coins, but he got them and bottles from the dump and stuff only because he thought they were pretty. I told her to get them valued, along with the bottles.
Turns out her dad left her a small fortune and no one knew. She was going to throw out all his stuff. She is so glad we checked.
I am in Australia so we have a differnet monetary system, but I have looked up which coins to look out for and keep an eye out for them.
Thanks for this post.
This is all fascinating to me…both the article and the comments.