Why are some coins magnetic?

Answer 1

It's simply a matter of what metal(s) the coin is made from. Some metals like iron, steel, and nickel are attracted to a magnet while others like copper, gold, and silver are not.

Up till recent years iron and steel have rarely been used for coinage because the metals rust easily. That's what happened during WWII when the US struck steel cents to save copper for ammunition. The coins were coated with zinc but as soon as the zinc wore off a bit the coins rusted.

Canada has large supplies of nickel so for many years its 5¢ coins were made of pure nickel and would stick to a magnet. From 1968 to the early part of this century Canadian dimes, quarters, halves, and dollars were made of nickel as well. (US nickels are actually mostly copper so they don't stick, btw.)

Within the last decade new methods have been developed that allow steel to be used more readily, so many countries have switched to steel coins because they're less expensive to produce. As of 2012 the US is very tentatively considering steel coins as well but the decision will likely take years due to political gridlock.