With silver prices rising to then-astronomical levels, it was becoming cost-ineffective for the United States to mint coins in silver. So, after much debacle, the U.S. Treasury approved the minting of the half dollar in a 40 percent silver composition (the dime and quarter were minted in copper-nickel clad – with silver completely removed from those coins).
There was another coin-related issue facing the U.S. government that year, and that was a growing coin shortage, which was partly to blame on silver hoarding. However, the U.S. Treasury also held coin collectors responsible in general, who were removing coins based on their mintmarks to fill coin albums and books based on date-and-mintmark series collecting.
The U.S. government therefore deemed it fit to remove mintmarks from coins altogether in an effort to stave off coin hoarding. As further punishment to coin collectors, the U.S. Mint stopped producing proof sets and conventional mint sets that year, instead offering a so-called “Special Mint Set” that includes one coin from each denomination. Each Special Mint Set (SMS) coin features a semi-mirror-like finish, with some being a little more lustrous and reflective than others.
Uncirculated 1965 Kennedy half dollars are worth about $4 each while SMS 1965 half dollars are worth around $5.