Banknote Lifespan Is Determined By Denomination

When you pay for something, have you ever wondered about the age of the banknotes you pull out of your wallet? If you're paying with $20, it's quite possible that the bill is at least eight years old. If you're paying with a $100 bill, it could be up to 15 years old.

Banknote lifespan is determined by denomination. $5 bills get exchanged far more often than $100 bills (which are often retained for their value) and therefore, wear and tear takes its toll much earlier. The US Federal Reserve gauges the state of paper money through sophisticated processing equipment to determine its remaining lifespan. Any notes lacking in quality are then removed from circulation and destroyed.