Save Your Nickels! What You Need To Know About Nickels

by David Hathaway

Are you doing due diligence with nickels? As many LRC readers know, nickels are the only real “money” being distributed by the U.S. Government at this point in time. The value of the metal in a nickel equals the fiat value assigned to it by the state.

This cannot be said about the currently produced pennies, dimes, quarters, or half dollars and certainly cannot be said about the paper money or the even more insidious and plentiful computer digit money that we are forced to use. Nickels are uniformly marked, impractical to counterfeit, and easily recognizable for their metallic content (75% copper, 25% nickel).

So, is it really that easy to get real money in exchange for the worthless stuff floating around? Yes, it still is. You walk into a bank, hand the teller a 20-dollar bill, and walk out with 10 rolls of nickels. There is no dealer markup. There is no sales tax. There are no shipping fees.

There is no capital gains tax or value added tax. It almost seems impossible in this day and age. It soon will be impossible. We are temporarily in an era with nickels that is analogous to the pre-1965 silver coinage period. Coin composition is slated to change during the 2013 fiscal year.

So, what are the issues that would preclude a person from taking advantage of the inevitable increase in the value of nickels when compared to the fiat dollar? Well, there is one small issue and one slightly bigger issue. The small issue is obtaining the nickels and the bigger issue is storage. Both issues can be resolved fairly easily for most people. First, let’s look at the smaller issue.

Silver nickels and golden dimes

You don’t want to shoot yourself in the foot when obtaining nickels; not to mention your fellow hard-money brethren who are doing the same thing. Don’t go into a bank and make a grandiose gesture by asking to speak to the branch manager and discussing the bulk acquisition of $1000 or $10,000 worth of nickels.

I have read articles where people proudly describe the incredulous looks they get from the bank employees and the follow-up questions administered by the bank staff from such an action. These articles usually include a description of how they schooled the bank employees about how the customer was hoarding nickels as a hedge against inflation. Don’t have this conversation with the bank. You don’t want to be the source of new bank policy restricting the acquisition of coinage. Some banks may charge a percentage for obtaining coins but, most still don’t. With nickels it is still so easy.

You need to have a systematic outlook. What you do is always lay down a 20 dollar bill and ask for 20 dollars in nickels. No more. That’s all. Make this fit into your lunch break at work, your commute, your exercise routine, or your shopping routine. You can go to one, two, or three banks fairly quickly. Don’t get the coins using your debit card or a check. Keep it to a simple hand-to-hand cash transaction. You don’t want multiple computer entries showing up on your bank account at different bank branches 10 minutes apart.

It looks like you are doing something. Banks look for patterns and they will ask more questions. You aren’t doing anything wrong but, once again, you don’t want to make waves. You want to be able to continue getting your nickels. Giving out $20 in coins is no big deal to a major bank but, retailers that get coinage regularly usually do have to pay extra for the privilege.

Small account holders and even non-account holders are usually given “small” amounts of pre-rolled coinage in exchange for paper currency as a courtesy at no charge. You want to be in the small customer “courtesy” realm on this issue. Being in a slightly bigger town is a plus but, not essential.

If you happen to be on a lengthier shopping trip or road trip, you can get $20 worth of nickels ten times fairly quickly at ten different banks. Remember, you don’t want to be responsible for the issuance of new restrictive policies within your local banking world. Banks talk to each other. They go to conferences. If only a few guys in a town of a million people are trying to get large quantities of nickels on each transaction, the word will get out and policies will change.

You won’t believe how quickly you acquire nickels at this rate. You quickly get in and out of the bank since you are not doing account-related transactions. You get 400 nickels each time you hand over a 20-dollar bill. The transaction usually takes less than a minute. If you do this twice every day on your lunch break, you will have nickels coming out of your ears. Don’t try to do it at a quicker rate. You will end up causing problems.

The second issue, which is really the point of this article, is the storage of your nickels. One of the first rules for obtaining and storing metal as a hedge against inflation is to take possession of the metal yourself and to not trust someone else to store it for you.

A warehouse receipt can be next to worthless in a hyperinflationary environment and is subject to the same type of mishandling that has been seen in metal futures, ETFs, and other paper forms of metal. Nickels do present a challenge for storage but, the challenge is not insurmountable.

Silver nickels and golden dimes

Green military style ammo cans are a very tempting solution. They have one serious drawback. They look valuable. That wall of ammo cans in your basement really looks like a stash of something worth stealing. The larger size (generically called .50 caliber ammo cans) are too heavy when filled with nickels. The smaller size is easier to handle. They weigh about 35 pounds when filled.

They hold about 88 rolls. Each roll contains $2 face value of nickels. So, you are preserving about $176 face value of nickels in one ammo can. To get up into multiple thousands of dollars, you will have quite a wall of ammo cans. They get harder and harder to conceal. They won’t fit in a floor safe or that hollow brick like your gold coins do.

So, what’s the answer? After years of experimenting, I have found the perfect solution. Home Depot sells pre-cut 24-inch sections of thick walled 4-inch black ABS pipe. They also sell the 4 inch ABS end caps and ABS cement. This combination makes a perfect long-term burial solution. The ABS cement causes a reaction to occur that is the chemical equivalent of welding the plastic end caps on by chemically softening, melting, and then permanently binding the adjoining surfaces of the two plastic pipe fittings together. PVC pipe also works. The nickels will last for decades in pristine condition underground when stored in these pipes.

I had an occasion to dig up 10 pipes recently containing a total of 560 pounds of nickels that had been buried for three years. The store bar-code stickers hadn’t even come off the pipes yet. The pipes with the caps glued on with the ABS cement still looked brand new. Each of these pipes holds 122 rolls of nickels on average. The pipes weigh about 56 pounds when finished.

I have found that drilling a tiny hole with a small drill bit aids with pushing on the final cap since the glue makes the caps airtight and the air pressure makes it hard to push the second cap on. The air relief hole allows the cap to slide on easily before the cement binds the parts together permanently. The small hole can then be filled with ABS cement to make the pipe watertight. To get the nickels out, you will have to cut the pipe open with a saw.

After preparing multiple pipes, dig a trench. It will look like you are installing a water line or a sewage pipe. The 24″ X 4″ inch black pipes look like sections of sewer line. You can rent a trencher to make the process quicker and to reduce prying eyes. I have found that even sensitive metal detectors cannot detect the pipes when they are more than 12 inches deep. To be on the safe side, you can make your trench 18 to 24 inches deep. Even if they are buried less deep, they have the metal detector signature of a buried water pipe and won’t look like an attractive target to unearth.

Silver nickels

I will address one more point since I hear this all the time. How do you cash in the nickels for the metal value? You don’t in the short run. This is not a buy and turn over proposition. You don’t have to worry about the legalities of melting coins. People don’t have to melt down pre-1965 silver coins to get the metal value.

There will always be a market for the actual metal value in the coin. You don’t have to melt down gold coinage to get the metal value. Some day, when the effects of massive inflation are more evident, you will have your hedge against inflation and you will be able to sell your coins for their metallic value as you need to.

In the case of nickels, they won’t have to be assayed. They are marked and it is obvious what they are. Their metallic content is common knowledge. There is no down side with nickels. If nothing else, you have gotten your money out of computer digits and you are holding it in tangible form for the coming banking crisis. It just so happens that you got full value for yours in incorruptible metal form with a picture of one of the less offensive presidents stamped on the side.

David Hathaway is a former supervisory DEA Agent who homeschools his nine children. He enjoys writing about the injustices of the state. Copyright © 2012 by LewRockwell.com. Permission to reprint in whole or in part is gladly granted, provided full credit is given.

Comments

  1. Pre-1982 pennies are worth collecting as well. With copper down their value is down as well but copper is copper.

  2. This is something I’ve thought about quite often and this is as good a time as any to ask this question: In a situation where the value of fiat currency reaches zero, what good will nickels, or gold or platinum for that matter, be? When the coin of the realm is a little bit of coffee or a hunk of meat, what value will precious metals, which can’t even be melted down to make bullets, actually have? I guess my main question is what is the point of stockpiling this stuff when all it’s doing is taking up space better used for something of actual real world value? What purpose will precious metals serve when about all they’re useful for is throwing at someone and hoping you knock them out with one shot?

    • Old copper penny’s can b melted down for bullets,pounder tools…ect.. so don’t give up on the idea entirely ! 🙂

    • Whenever that day arrives, trading and barter will rule at first. Then people will start to remember the value of money — e.g., ammo,brass, stone arrow heads, shells, beads, or, maybe, coins like nickels. Money is convenient for trade.

      Nickels. I don’t go overboard collecting them. Never spend one. About every other month or so I gat 10 rolls. Usually asked why. I tell them I use them for game tokens. Seems to satisfy them.

    • Crazy Joe in South Jersey says:

      Have never met anyone who would trade food for nickles but silver or gold is another story . Greed and desire always covet silver and gold . I see no use for keeping nickles . Steel is something to make knives out of but a nickle knife ? I pass .

    • If u ever need something to shoot from a wrist rocket try a couple of penny’s r nickels . …there freaking deadly…for food..

    • I won’t have 2 worry…1 shot is all u need…

    • I have often thought the same thing as well. You can’t eat the coins and how do you divide a gold coin to purchase a small item as a few rounds of ammunition and etc. It seems to me that barter is going to be the out for many. I have stocked up of alcohol as a barter. Don’t know how many bottles of liquor I have now. Had considered tobacco, but that stuff does not have a long life span.
      Good point you bring up.

  3. riverrider says:

    like, who are you going to sell them to?

    • It seems by reading the comments here that readers see the collapse through the view of Hollywood movie producers, where the world is thrown back to the stone age with no hope of recovery for one thousand years…

      Go study history to see what really happens after a collapse or major disaster. Then you will see the value of investing SOME of your preps and resources into gold, silver and other metals.

      • Another article suggesting the same thing…

        https://survivalblog.com/nickels/

        • Crazy Joe in South Jersey says:

          Howdy MD , did not pay attention to the web address and turns out it is Rawles’s site . As much as I do not like him I read the article and it’s pretty much what this contributor wrote . As a coin collector , for both fun and profit , these past 50 years only the 3 legged Buffulo Nickle and a couple of others are worth having due to their scarcity . Somehow I am missing the point of keeping them . Good friends have more value to me , even over silver and gold .

      • Thomas The Tinker says:

        Say Aaaaahmen MD! In the worst case I can see becoming my own bank to the ‘other side’.

    • Sell????more like trade..money won’t b worth crap..except for gold..the greedy will still want it and will give up everything thinking they will live long enough 2 spend it…those are the people u will love!!!

  4. It would be the metal itself that is of worth. Nobody’s particularly going to care that it’s in the form of a nickel, but the metal can be used to make other items that are needed.

    Or used as jewelry–who knows?

    • In my area we have the indian casinos. Buying nickels can be used as a guise for feeding the nickel slots. That being said buying a 20 or 40 dollars worth of nickels each payday would not be unreasonable to a bank employee.

      • Nickels from the casinos! Great idea. Thank you for the lesson.

      • One point I see in doing this is that once you have the nickels you will be less tempted to use them to purchase something you may not really need.

    • Crazy Joe in South Jersey says:

      What items will I make from nickles that are necessary for my survival ?

      • Too late 2 teach u…Sell????more like trade..money won’t b worth crap..except for gold..the greedy will still want it and will give up everything thinking they will live long enough 2 spend it…those are the people u will love!!!

        • Crazy Joe in South Jersey says:

          Trade nickles … hummm . I see my many rolls of silver dimes and quarters having more benefit . No value now and to cash in for metal value then better have half a ton to make it worth one’s while . Societal Collapse ? ? Hey I got a roll of nickels for bandages or food …. I would not give a plugged nickel for this one .

  5. I can sure understand the concept but the weight thing is what is stopping me from doing this. My weightier metals are not quite as shiney and a whole lot softer. I melt and mold that ‘product’ for other endeavor’s. Of course I can sell that product for a nickel apiece or even two , three, or four to the nickel, depending on size (wink). Various diameter and weight’s of mold’s are a good thing to have handy.

    • Melting the metal reminds me of a story I heard. Back when people were moving across borders in Europe and being forced to leave valuables behind, one astute fellow escaped with his fortune. He melted platinum and cast a set of VW tools, then threw away the original tool set.

      Could be something worth remembering. Just sayin’

      • That’s a great story! Alot of platinum and a bit of grease to blend in, LOL!

        Of course I was refering to lead, but your story’s point is well taken!

  6. I have not gone to the bank to buy “change” in some time. When I did, and they asked me about it, I said my grandson’s had taken to filling collectible books with nickels and pennies – that it was an inexpensive hobby for them as they were spending much of the summer with working grandparents (at the time). They “nodded knowingly” and even help me by getting older, non-mint wrapped rolls. Some times I also did dimes, quarters, and half dollars.

    Now I just sort my change. Nickels go in one jar, pre-1982 pennies in another, the rest of the change goes into a larger one.

    After reading in a fiction book about a “reset” of paper money of 10:1 I started keeping some of the “other” change. The books premise was that recalling and re-minting change would not be cost effective. So “change” retained its original value. It doesn’t cost much, and it “might” have a future benefit. Another potential base covered.

    The articles comment about using ammo cans to store your “change” is correct; THEY ARE HEAVY. It does have the advantage of making stealing you “wealth” more difficult! But I like to keep mine in rolls, so .30 cal cans work for me.

    Also, in “Alas, Babylon” future generations hammered down old coins for arrow heads. Interesting anyway.

  7. mom of three says:

    I too have stopped getting nickles, at the bank they would ask me why I was buying 5 rolls!!! That was every two week’s not every day! So I just bought some coin rolls and just go through our coin’s now it’s easier and no one asks me. It does add up quick and it’s good to have at least $50 to $100, in coin’s for thd what if in life. Our city, still has the coin operated meters, so I keep at least $5.00 of coin’s in my coin slot of my truck. Plus it’s useful at the drive up to give them exact change. It may be useful to have $25.00 to a $100.00 in $1.00 bill’s and $5.00 in case of power outage to pay for small purchase too.

    • Could be a good idea to hold a few dollar bills and quarters too because vending machines could be the only source of some desire able stuff before they are vandalized..

    • I usually have a younger girl at the bank ask me the “why”. I always just say that my husband “Grandpa” has some sort of educational poker game he made up with the grandkids and he seems to lose alot.

      And they believe it.

  8. Sad to say that when I started saving nickels they were worth close to 5 1/c cent apiece. Yesterday the melt value was 3 cents each. Says a lot for the state of the economy. Glad to say that I only paid 5 cents apiece and they are still worth 5 cents each! All in all not a bad way to save. Unfortunate part is that as inflation continues that nickel or multiples of same buys less and less.

    • A co worker who was a 5th blackbelt in a martial art ( I forget which one I would not pronounce it right if I did) . He was invited to judge at a meet in Maui. He was wondering how to swing that as far as money goes. Then he looked at his 5 gallon Alhambra bottle. He took it ti Safeway and was able to get his airfair and some other expenses out of that bottle of change.

      • He would have gotten 8% more by rolling them himself, that’s not free, read the small print on those cash-in machines

        • I take my loose coins to the credit union; they don’t charge me for counting them. I then usually deposit them in my account, at least for a while.

  9. value of the metal in a nickel is about half of the fiat value
    $0.0266489 melt, which is 53.29% of fiat.
    Copper and nickel have plummeted in the last few years,
    http://www.coinflation.com/coins/1946-2007-Jefferson-Nickel-Value.html

    1909-1982 Cent (95% copper) are the only coin worth over fiat at $0.0130969 or 130.96%
    http://www.coinflation.com/coins/1909-1982-Lincoln-Cent-Penny-Value.html

  10. Silver and gold I can understand; these metals have value because everyone believes they do. Same with platinum. But how is nickel more valuable than, say… aluminum, or brass?

  11. Do your homework, the US Congress has outlawed the “selling” of cent coins and nickels. There will be no market value unless the US ceases to exist. This is quite a bit of work and you will get no return, save your time and trouble

    • In the future, I think the government’s “outlawing” of melting coins for metal will be adhered to about as closely as the criminals following “gun free zone” laws…

  12. PrepperDoc says:

    I’ve got no problem with people saving some of each kind of base metal. The one I’m particularly interested is a certain alloy of lead, that I can cast for bullets! I have plenty of that one.

    The economic downdraft is making base metals far cheaper. I’m not sure what is the cheapest way to get copper or nickel, but going to the hardware store and evaluating their price of copper wiring might be worth doing. You might be able to get more copper for even less money.

    I don’t think you’re going to find nickel there however.

    • PrepperDoc says:

      I read the survival blog article referenced on nickels, and it made a believer out of me. I’ll stock up some Nickles!!

  13. It looks like this article went over a lot of folks heads. That or they just read the headline and not the post to find out the reasoning behind the article. I know that happens a lot because I’ve published and in 30 seconds have a comment posted…

    Anyways, like I’ve always said get your main preps – retreat, food storage, water, medical and defense needs taken care of first and then look into investing in metals and other wealth retaining items.

    • Luv u man…lots of CLUELESS PEOPLE WHO ARE GOING TO BE SORRY..well so much 4 nickels . ..more 4 me!

    • Mountain Trekker says:

      MD just remember, in 1964 most people thought it was stupid to save dimes, quarters and halves. Actually my Ex thought I was crazy when I gave 15 cents for some pre 64 dimes in 1968. I would have saved coins in 1964 but did good to come up with 2 dimes for a pack of LSMFT. Trekker Out.

    • Some people have so made up their minds that information that is contrary to their paradigm can cause them physical pain.

  14. jim smith says:

    Metal coins have no third party risk. Zinc is powerful industrial metal in constant demand. Mines are closing at alarming rate due to high cost of operation. Metal coins are real money that need NO Central banking cancer for economy to operate. This metal is store of value for smaller transactions. A tomato, one egg, one head of lettuce. Ounce of gold for s loaf of bread, I dont think so. Paper currency is debt and the bill is due.

  15. Could you use nickels duct taped together to make a shotgun slug?

  16. Are all nickels including new ones valuable or just old nickels

    • DOC:

      To date, all nickels, except some WWII ones that were silver, at the same metal content. Check coinflation.com for current percentages and values of US coins.

  17. This isn’t really a good idea. No matter how much the value of the material in a nickel will rise, it’s just not enough to make it worth the time and effort. $10,000 woth of nickels would be extremely bulky and heavy. Then there’s the matter of even getting someone to recognize that value in the event of a collapse. If you truly believe that an economic collapse is coming, the premium you pay for gold and silver will be offset immediately, and most likely exponetially. In addition, you will have a highly recognized world currency that most people would accept. I personally stick to the U.S. coins as bars can be counterfieted too easily.

    Hoarding nickels as an alternative to gold and silver is penny wise and pound foolish. (I couldn’t resist)

  18. CanadaNickel says:

    Those who say it is not worth the time are foolish. There is so much time wasted by the avg. person watching TV or surfing the ‘net that could be used for nickels. $10,000 in nickels is still $10,000 of money you have on hand.
    In Canada my bank does every transaction through cards, I’ll try cash next time and see if I still need to swipe my card. Also in Canada, we still have nickel Nickels as well as 75/25 nickels. Any coin with a mint mark of P or the Maple Leaf is junk coin so know your dates.
    People in 1964 were likely called stupid too when they did the same thing we are doing now.

  19. CanadaNickel says:

    PS: We have no penny’s now in Canada, nickels are next on the hit list!

    • The Canadian government is much smarter and more willing to to the right thing than the US government. Canada did away with their anchor baby law as well.

  20. So, where did you bury these nickels again??
    LOL