Goodbye to damaged bills: This is the lifespan of dollars and what happens to them when they are removed from circulation

While you may not think about it as you slip a crumpled $5 into a vending machine or toss a worn $1 into the tip jar, every United States dollar bill has a surprisingly well-tracked lifespan.

Whether it’s the well-loved single or the prized one hundred, each Federal Reserve note follows a fairly predictable journey from freshly printed to end of life. But just how long do these bills last, and what actually happens to them when they’re deemed unfit for circulation? We thought we’d take a look, and who better to ask than the Federal Reserve?

Bad quality dollars removed from circulation

According to the money officials, dollar bills get routinely examined and, if they’re still in good shape, continue circulating. But when they’re too damaged, they’re pulled from circulation and destroyed. This quality control process ensures you’re not left dealing with paper currency that’s barely hanging on, as each bill only makes the cut as long as it meets strict criteria.

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Why do some bills last longer than others?

If you’re wondering why your $100 bill seems to last much longer than a $1 bill, it’s no coincidence. Each denomination has a different estimated lifespan due to how it’s used. Obvious when you think about it, right?

For example, $100 notes, often stored away as savings or investments, rarely see the same daily exchanges as a $5 bill, which is used more frequently and sees the wear and tear of constant transactions. While a humble $1 note has an estimated lifespan of just 6.6 years, a $100 bill is likely to last a solid 22.9 years before it meets its end.

Here’s a quick breakdown:

These lifespans reflect each denomination’s workload in the world of transactions. Smaller bills simply age faster because they’re constantly being handled, folded, and occasionally, left forgotten in laundry. We’ve all done it, but rarely with the one with Benjamin Franklin’s face on it!

How are damaged bills detected and disposed of?

When cash is deposited back with the Federal Reserve, it’s scrutinized by high-tech processing equipment that inspects each bill’s condition. Bills that pass this rigorous check get back in circulation. But those that show signs of serious wear – tears, fading ink, excessive creases, or even small chunks missing – are marked for destruction.

Where do dollars go when they die?

Once a bill has reached the end of its lifecycle, it doesn’t just disappear.

Those marked for removal are destroyed by shredding machines in Federal Reserve facilities. From here, things can get creative: some of these shredded bills are repurposed for compost or even sold as novelty souvenirs in shredded form. Obviously the whole purpose of this is to keep bills in circulation that are easy to handle and recognizable is important for day-to-day transactions.

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