smart spending

How much do bad habits cost?

Smoking cigarettes
Smoking cigarettes © Romanchuck Dimitry/
  • Yearly cost: $2,555
  • Savings after 30 years of compounding interest: $201,994

Cigarettes retail for about $5 to $12 a pack, depending on where you live. But factor in increased medical expenses, insurance costs and the impact of secondhand smoke to society, and the real price increases dramatically. Researchers from Duke University and the University of South Florida estimate that, for a woman, the all-inclusive cost of smoking over a lifetime is $106,000; for a man, $220,000. This includes social costs imposed on others via Medicare, Medicaid and Social Security.

Richard Kappers, director of marketing at Cigna, says smoking not only drives up life insurance costs by 20 percent and increases health insurance expenses, it can also impact your ability to qualify for either.

But renouncing the habit pays off. Quitting smoking at age 39 can reduce the "excess risk of death from any cause" by up to 90 percent, according to a January 2013 article in The New England Journal of Medicine, and can qualify you for the same insurance rates as nonsmokers, says Kappers.

"Generally, they want you to be tobacco-free for 12 months before you can get the nonsmoker rates," he adds.

It's difficult to put a price on smoking for an individual. Considering just the cost of the cigarettes themselves, smoking a pack a day at $7 a pack will leave you $2,555 lighter in the wallet per year. If you instead invest that amount annually, after 30 years, you will have amassed $201,994, assuming a 6 percent return.


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