penny pincers

how to spend the spare change that's always falling out of your wallet

When was the last time you dove into your wallet to pay for something with coins? Some of you may not have even used paper money for a long time, and perhaps balked at an interaction that reminded you that cash still exists, and that some places operate only on physical money and don’t accept card payments. 

Between rapid advances in payment technology and higher-than-average inflation in recent years, the use of paper money and especially smaller denominations like coins has drastically gone down, with reported use of cash payments in the UK falling from 55% of all transactions in 2011 to 15% a decade later. Coins are so hated that a waste management company estimated that Americans threw away $62 million in change per year — yes, literally threw units of legal currency into the garbage. And that was in 2016, before the spread of tap payments in the US (Canada adopted it many years before that — incidentally, they also ceased production of the penny in 2013), mobile payments, and COVID-19. The latter felt like the nail in the coffin for physical currency, which was regarded as dirty and potentially contaminable. 

What do we even pay for with such small denominations these days, especially with inflation as it is today? It feels like everything costs at least five dollars these days (the get off my lawn vibes are evident). 

But there are some places where three crisp dollar bills or even a few quarters can pay for an item (or an experience): let’s take a look. 

Your typical cash depository that is less unseemly than a dustbin: the tip jar. Full of crumpled dollar bills and enough metal to replace a broken hip, this is where we drop off unwanted coins after that awkward moment when the cashier hands you your change where you think, “Ugh, now what am I gonna do with these goddamn coins?” Increasingly, point-of-sale systems in places like coffee shops, Subway, and even a particularly bold Vancouver liquor store also have the option to tip on the iPad after using your card to pay — but that’s a whole nother debate for the writers, both of whom adamantly refuse to be impulsively guilted into tipping a dollar for a muffin. “Round up your purchase to donate to charity” schemes are similar, making people feel heartless in front of the line of customers behind them if they say no; but to dispel an oft-repeated myth, grocery stores engaging in checkout charity programs cannot deduct the donated amount from their taxable income — unless the store donates a portion of their own sales, your forty-seven cents make no impact on their taxes. In fact, the donator can claim the write-off (though no one ever does — who wants to keep a grocery store receipt until tax season?). Shit, we’re getting off topic — anyway, true physical tip jars are probably the best way to rid yourself of small denominations, especially when inflation makes them less valuable; but if coins are that objectionable, it may be worth switching exclusively to credit cards (just sayin’). 

Then there’s the industry where small purchases are the lifeblood of the whole enterprise: mobile games. It’s difficult to tell whether inflation has affected mobile game prices, but there are plenty of other problems worth discussing. While lots of people stick to ad-clogged free versions, there are many who can become almost addicted to the ninety-nine cent purchases of digital coins, unlocked avatars, costumes and weapons and upgrades for their avatars, and the like. A fearfully large number of online stories feature people going into debt through tiny purchases that can be easily justified in the moment, but may get out of hand if they aren’t monitored or controlled in some way. The writers freely admit to having spent marginal sums on good apps to support creators (the key to this being one-time purchases, not subscriptions) but not everyone has enough self-control to avoid a slew of small in-app purchases on a single credit card statement. And that’s without mentioning the countless news stories of children who have unknowingly (at least we hope so) spent hundreds or even thousands of dollars on in-app purchases while playing on their parents’ devices. Buddy, no one needs that many Robux.

We also spend tiny amounts in tourism (souvenir coin machines and small beachside tchotchkes are often enough to calm a grumpy child on vacation), convenience stores (“I need to eat something right now and this shitty pizza will do”), public transportation (no complaints — praise be to the metro system), and parking meters (you’ll be so surprised to hear that the writers also feel strongly about parking, considering we met in a sustainable urban design class and one of us wrote a final paper about free parking). While inflation has affected these industries, the reality is that those who want it will pay for it. On vacation it’s easier to space a few bucks; you need calories one way or the other; and no one is immune from having to go places. 

There’s the oasis of the starving office worker: the break room vending machine. Although a few machines in trendy spaces have been retrofitted with credit card tap readers, a large majority remain cash-only, making them a convenient place to use up spare change. Offerings are no longer limited to stale snacks and sugary drinks, either, with newer machines sometimes selling everything from painkillers to SD cards to live crabs. Nowadays the crumpled spare change from your bag is somehow never enough to buy the small bag of chips, at least without the machine rejecting the bills because the corner is folded with sweat and cocaine residue. Though rejection isn’t the only thing this machine loves to dispense; each time the snack gets stuck in the revolving circle thingy, the machine dispenses frustration and disappointment. The vending machine industry has become, especially in the aftermath of the pandemic, an oft-recommended place for young entrepreneurs (yes, we still hate that word) to create a side-hustle (hate that one too) or another semi-passive income stream (blech). It’s the proto-”buy a house in a growing city and get rental/Airbnb income” for the underdogs who have less capital to invest. It’s one of the few industries remaining in the country that is still dominated by independent sellers rather than a franchise or a megacorp, which means there is at least one article from every major news network in the vein of How this 26 year old made $400K from his side-hustle: ‘I only work 5 hours a week’. These days, those five hours are usually spent on a laptop monitoring the machines and buying stock online where twenty years ago it would require visiting each machine and collecting money throughout the week and maintaining a log of things each machine needed. If a machine broke in those days, it would have taken longer to realize and even longer to fix, which meant loss of profit; but current technology keeps machine owners updated and reduces downtime. As vending machine purchases are typically small and made on impulse, they’re relatively resilient to retail pressures from inflation and online shopping: try to remember the last time you bought a chocolate bar online, or walked away from a vending machine because you noticed the price had increased by twenty cents. Machines are specifically placed in areas with high foot traffic and few good food options within walking distance (and remember: Americans’ ideas about a reasonable walking distance do not usually extend beyond the bounds of a Costco parking lot).

And last but not least, the machine every parent dreads because they know that not only will their kids beg them for money to use the machine, they will keep “needing” more quarters because they haven’t clued in yet to the statistical improbability of a win: the clawwww. Proto-claw machines have been around since the 1920s, when “digger” machines would scoop candy out for the player in exchange for a few cents; they weren’t very profitable, but they were popular attractions. When the Nickel Digger, which used an electric motor, was invented and rented out to carnivals beginning in 1932, it made the founder a shitload of money. The 1951 Johnson Act regulated gambling and dampened the popularity of digger machines, but the law was abandoned in the 70s and the claw machine as we know it today became popular. Filled with anything from bulk keychains and plushies to electronics like iPhones and gaming consoles to even Visa gift cards, it’s understandable why such a game draws kids in so effectively — but adults tend to feel like the machines are rigged against you to the point that no amount of skill can overcome it. And we’re right: modern machines allow the operator to choose the grip strength and win percentage of the machine; they can even calibrate how often the machine picks up a toy and then drops it before you reach the release chute — hell, they can input their desired profit and the machine can calculate it for you. Each failed attempt appears as the result of user error or bad luck — and once that kid sees their toy fall back into the machine, it’s no wonder they are filled with the compulsive desire to try again (and again). Again, because vending machines are located in high-traffic areas and especially in places that are already somewhere you go to spend money (pizza places, boba shops, arcades, etc.), many parents give in and begrudge their children some bills or change. 

So why did we give you this disjointed run down of unrelated machines? Just because it was fun?

Well, yes, it actually was fun — but that’s besides the point. The phenomena that have affected these mini-industries are nuanced and interesting: on one hand, because cash is decreasing in use in many parts of the world, spare change and small bills are not as common to have on hand. But also, as the value of small denominations decreases due to inflation (and as many of these machines become card-friendly), spending in these areas becomes more common as people shrug and say, “My grocery bill is already $300 per week, why not spend a dollar?” These purchases can quickly get out of hand, especially when you add kids (and general existential ennui) into the mix. But someone who holds off on all purchases of this kind on principle is probably leading a controlled life without a lot of fun.

So here’s our conclusion: spend knowingly. Don’t be tricked into thinking that the tap of your credit card is as meaningless as a nickel on the sidewalk; but also, don’t trip over a pound to pick up a penny — buy that Twix bar if it’ll make you happy. In the grand scheme of things, you won’t miss that one purchase of $2.35 [price data sourced from my friendly neighborhood vending machine].