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Got coins? If you do, odds are you havent been using them much lately due to coronavirus sheltering. But swapping $10 in coins for paper money could get you a free sandwich! Thats just one more example of the collateral damage done from the coronavirus outbreak, a shortage of coins in circulation. Today on MoneyWise, financial planner and teacher Rob West explains why this is happening and where you can cash in.
Theres probably about the same amount of coins out there as before the pandemic hit but its just that theyre not getting into circulation. Online purchasing has soared during the crisis and so more folks are using plastic to buy things. But when people dogo out, theyre more likely to use credit or digital payment options. The upshot is that brick and mortar merchants are struggling to make change because fewer coins are in circulation.
Two Chick-fil-A locations (Huntsville, AL, and Lynchburg, VA) have been offering customers free food options if they exchange their coins for paper currency. We mention this to illustrate the extent of the problem that merchants are facing. We know that in some instances theyre rounding up prices to the next highest or lowest dollar amount.
There are plenty of coins out there, but because circulation is down, sometimes theres a shortage where needed. The central bank is working to increase the flow of coins; but its options are limited. You cant force people to spend or turn in coins, at least not yet.
Some blame state-mandated shutdowns for this problem saying theyve played a major role in reducing the amount of coins in circulation. And while the U.S. Mint usually cranks out more coinage as needed for the economy, it hasnt been able to increase production, again due to the COVID-related work disruption.
Could all of this demonstrate that we dont really need coins anymore? No, I think were still pretty far away from that, although the pandemic has certainly moved the needle toward a paperless or coin-less economy. Millions of people are becoming more comfortable using their smartphones to pay for things as a result of the pandemic. But this doesnt help brick and mortar businesses like restaurants and convenience stores that still have to deal with customers using cash to buy things.
Here are some questions we answered from our listeners on todays program:
Are there advantages of a trust over a last will and testament?
Is it ever a good idea to take money out of an IRA to purchase a car?
What does the Bible say about borrowing money to start a business?
Our financial advisor is a family friend and we go to church together. However, hes making poor choices in his personal life that make us wonder just how wisely is his managing our investments. Should we look for a different advisor?
Should we tithe off of an insurance settlement?
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