Personal Finance 

Where to Spend $1 Coins

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Dollar BillThe US Mint’s $1 Direct Ship program is back with several options (Native American, Golden Dollars with Sacagawea, John Adams, Thomas Jefferson, James Madison, George Washington and Andrew Jackson), meaning you can bust through some of those cash back tiers by purchasing money. These are regular circulation coins available in increments of $250.

In addition to killing cashback tiers, I recommended buying dollar coins to help kill the penny because it reduces our use of paper currency, which has a much shorter lifespan. I bought some of these dollar coins because of the small environmental impact, none of our cards have cashback tiers.

We didn’t want to go the route of depositing it at the bank because it’s against the spirit of the program and because we want to see them go into general circulation. It doesn’t bother me that people are instantly depositing the coins but that wasn’t my goal. Our goal was to get them into the world so we use fewer dollar bills.

The tricky part is that they come in $250 increments. You have to start getting creative and here is where I intend to use them.

Farmer’s Market

At the local farmer’s market, none of the vendors take credit cards. It’s partly because they’re set up in the parking lot of our local library but also because of the fees. Whenever I go to the farmer’s market, I always bring change from my charge jar because it’s a chance for me to run through all that loose change we have. By bringing along few dollar coins, I don’t have to sort through quarters to pay for things. Also, the vendors always appreciate getting change because they hate having to sell a $3 box of green beans only to have the buyer hand them a twenty dollar bill.

Stores You Like

When you use a credit card, the merchant is charged a transaction fee. The fee is usually around 3%, which can really eat into the profit margins of the smallest of stores. So if there is a local store that you like and you want to give them a hand, why not get some $1 coins from the Mint and use those instead of credit? You still get whatever cashback you’d get with a credit card but you also save the vendor some money. With the recession cutting into everyone’s wallets these days, shaving a few bucks off their expenses each month certainly helps them out.

Small Purchases

The next time you head to the grocery store or local convenience store to make a small purchase, bring a few dollar coins in your pocket. Sometimes I feel silly pulling out a credit card to pay $2.19 for a couple bottles of Gatorade (it’s mostly to avoid getting 81 cents in change) but it’s a prime example of where using dollar coins and taking the change means I’m finished a lot faster. Sure, I have to take the 81 cents in change but it’s small price to pay.

Ultimately, i t comes down to looking at your regular purchases and trying to find places where you have no choice, or prefer, but to pay with cash. The coins themselves are quite fun, “E Pluribus Unum” is inscribed on the edges giving it a very European feel. I really hope dollar coins take off because the idea of replacing billions in paper bills every 18 months, rather than 30 years, is very unappealing to me. Plus, when you think about it, coins are probably cleaner given their hard surface compared to the porous cotton paper mix of bills.

(Photo: SqueakyMarmot)

{ 23 comments, please add your thoughts now! }

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23 Responses to “Where to Spend $1 Coins”

  1. Philip White says:

    Sure, I have to take the 81 cents in change but it’s small price to pay.

    So how do dollar coins help kill the penny?

    It seems to me that only credit cards (cashless methods) do that.

  2. billsnider says:

    Europe is big on coins. When I travel there I find my pockets bulging with coins after doing some shopping. Generally cash changing places don’t want coins.

    So, I am not all that in favor of getting rid of paper.

    Bill Snider

  3. cubiclegeoff says:

    I just hate the idea of having to carry around a pocket of coins. But I think they’re a good idea for simple donations (like for Salvation Army buckets during the holidays), and as gifts for kids (every kid would like to get a little box of gold-ish coins).

  4. otipoby says:

    I am with Philip, I do not see how $1 coins help kill the penny. In your example, the retailer had to give you 1 penny. Cashless methods are the only way I see to kill the penny. Jim, please elaborate.
    BTW, I love the dollar coin idea. I lived in Europe for a while and I really got used to not having to pull my wallet out for small items.

  5. When I was still single, I used to tip in restaurants with dollar coins, especially in places I went frequently. I tried to tip well in those places, and hoped the dollar coins would make the servers remember how much I tipped 🙂

    Did it work? I don’t know. Service in those places was always outstandiny anyway, so I don’t know if the coins help me get better service or not. It certainly didn’t hurt, and it didn’t cost me any more than dollar bills would have.

    • Shirley says:

      We also did this, but with $2 bills. I would tell the receiver that the $2 bill carries good luck for one year and then must be given away freely to renew the luck for the next person.
      Yes, they certainly did remember us and often greeted us with, “Hey, I’ve still got my lucky bill!”
      I honestly believe that they too passed them along with the story.

  6. Amy says:

    In Canada we have a $1 and a $2 coin. It can get a bit bulky with all that change, plus it gets quite heavy.

  7. daenyll says:

    I think the idea is less in truly killing the penny as offsetting the extra cost that is now required to make the penny as compared to it’s face value. Coins have much longer lifespans than paper currency and as an added bonus are easier to distinguish the separate denominations than with the US paper bills for someone with visual impairments.

    • factchecker says:

      Not really, if you put your finger in your pocket a quarter will feel the same it used to look too.

  8. Jeff says:

    My credit card company caught on to the cash back on purchasing currency. They will not give you any cash back for buying any form of currency. Everybody be sure to check your terms if your gonna do this.

  9. Jerry says:

    In Los Angeles, a lot of the parking meters take $1 coins now. The ones on Santa Monica Beach all do, including the parking lot multi hour ones.

    Here’s a funny thought. I wonder how a dancer would react if you gave them $1 coins at a strip club? Lol!

  10. Jim is mistaken in the article, the dollar coins are meant to replace the dollar bill, not the penny (which has its own controversies). Dollar coins are meant to be a more durable alternative.

    • Jim says:

      In my original article where I mentioned the dollar coins, I said it’s one way to help kill the penny (or at least be more sustainable with cash). I know the dollar coin isn’t meant to replace the penny but it’s better than using the bills.

      • billsnider says:

        My father once told me that when he was a young boy in WWI Italy, stores made small change in candy. He thought this worked well.

        I also think it is a good idea and should be adopted here.

        Bill Snider

      • factchecker says:

        May I add the with commodity prices, the bills are regaining popularity to an extent.

  11. I hate carrying around a pocketful of change so the $1 coins would be a bit of a nuisance for me under most circumstances.

  12. Paul says:

    It seems like a lot of effort to go through for an extra $2.50 to $7.50 per $250 order(depending on your CC program) in reward dollars. Plus, if you spend the coins in areas where you would have used your credit card anyway, that kind of defeats the point of this whole thing because you would have gotten the rewards regardless right?

    Sure it can work sometimes like cash-only places or places you want to be nice to and save them the CC fees, but I just don’t think this is worth the trouble.

  13. zapeta says:

    I like the dollar coins, and its a lot easier for me to fish around for a couple coins than pulling out my wallet. I’m always afraid that something important will fall out when I pull my wallet out. Plus, I like the idea of the coins lasting a long, long time compared to paper bills.

  14. dintx says:

    the mint is ran by the US gov, correct? so why all the hussle and fussle about being “cost effective” and the life span of a dollar bill?

    on the other hand, i like the feel/sound of coins in my hand… and since i will be part of the ‘receiving’ end of the redistribution of wealth that our gov is currently setting up… i am glad to hear that i will be getting someone else’s money in metallic form (i would take it in cotton as well)

    • I can easily tell when I have an actual silver coin in my pocket from the distinctive sound it makes. I much prefer that sound to the sound of the other metals, for some reason.

      My wife thinks I’m crazy for caring … 🙂

  15. Dave says:

    I always carry 4 or 5 $1 coins with me, whenever I purchase something I always pay the mod-5 amount in coins. $7.35 = $5 bill and 3 $1 coins, $13.88 = $10 bill and 4 $1 coins. Most vendors dont mind a few coins, but handing over more than 4 at a time annoys some.

    I really wish the mint would offer a variety pack, going through 250 of the same type takes some time.

    Other useful places:

    Toll plazas, vending machines.

  16. What about airline rewards cards — will each purchase be an extra 250 (or whatever) miles? I’m thinking of trying this with $250 worth and seeing how long it takes me to spend through them.
    Here’s my suggestion about tipping, though: Make sure your server knows that these are DOLLAR coins, not quarters! He or she might get tight-jawed otherwise.

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