What Can You Buy With a Nickel?
Uncover the fascinating transformation of a nickel's purchasing power, from its past utility to its present-day reality.
The nickel, valued at five cents, has been part of American commerce for generations, but its purchasing power has changed dramatically. Once a meaningful unit of currency, its modern utility is significantly diminished. This transformation reflects broader economic shifts and the effect of inflation on monetary value. Understanding the nickel’s journey offers insight into the evolving cost of living.
Historical Purchasing Power of a Nickel
During the early to mid-20th century, a nickel represented substantial purchasing power. In the 1920s, for instance, a nickel could buy a ride on public transportation or small treats like an ice-cream cone, a cup of coffee, or a doughnut. Hershey’s chocolate bars maintained a price of five cents from 1920 until 1969.
The nickel continued to hold considerable value through the 1950s. A bottle of Coca-Cola, for example, cost five cents from 1886 until the late 1950s. For a nickel, one could also acquire a daily newspaper in 1950. First-class postage stamps cost two cents in 1919 and three cents from 1932 through 1958, allowing a nickel to cover postage for two letters.
How Inflation Changed the Nickel’s Value
Inflation is an economic phenomenon where the general price level of goods and services rises, leading to a decrease in currency purchasing power. This means a fixed amount of money, like a nickel, buys fewer goods and services over time. The U.S. Bureau of Labor Statistics tracks the Consumer Price Index (CPI), which measures these price changes. Over many decades, inflation has significantly eroded the nickel’s buying capacity.
For example, five cents in 1920 had the purchasing power equivalent to approximately $0.81 in 2025. This increase in prices means an item costing a nickel in the past would require a much larger sum today. While salaries and wages theoretically adjust to keep pace with inflation, the value of a static denomination like the nickel inevitably diminishes. This explains why items once available for a nickel are now priced considerably higher.
The Nickel’s Current Purchasing Power
In the present economy, an individual nickel possesses limited standalone purchasing power. It is generally not enough to buy any single item in most retail environments. While a nickel might contribute to sales tax on a larger purchase, it rarely covers an entire transaction on its own. Even the smallest individual candies or gumballs typically cost significantly more than five cents today.
In some niche situations, a nickel might represent a fractional cost of a bulk item. However, for practical, everyday consumer goods or services, a nickel’s value is primarily symbolic. Its main utility often lies in rounding cash transactions or contributing to a larger purchase.