To all of you smokers out there, including my very own friends, I’ve got a message for you.
No, my post does not include one of those creepy and disturbing videos of a person peeling off their skin when buying cigarettes, squeezing a sponge full of tar, or having a person speak to the camera after they’ve had a laryngectomy.
We all know the health impacts and how it is brutally devastating. While I have your attention, please consider to stop smoking. You may be good now, but who knows how your life will change tomorrow. If that’s not stopping you, I want to take the financial perspective of smoking cigarettes. Combine the literal destruction of your health with the opportunity cost with your finances and it’s just complete nonsense to continue smoking.
I’ve done some research and the average cost of a cigarette in our country is $7.84. States like New York and California have prices of $13.95 ad $10.51 for a pack of 20 cigarettes, respectively.
It’s important to consider the financial impact this habit / addiction / life style (whatever you want to call it) because you may not realize just how much these cigarettes are costing you and the missed opportunities you have to improve your financial life and overall quality of life.
If you’re priority is to save cash, whether it’s for an emergency fund or for your next vacation, then check this out. Let’s just assume that you’re paying $7.84 for each pack of cigarettes (national average). $7.84 may not seem like a lot, but if you’re smoking 1 pack a day, it is costing you a total of $2,861.6 in one year! If you just “casually” smoke 1 pack every 2 days, then it’s still a whopping $1,430 a year.
If you’re from New York, smoking is costing you between $2,545.86 and $5,091.75 a year! Dude, for $5,000 my wife and I traveled to Costa Rica for nearly 2 weeks and had the time of our lives!!!
I took this pic in Costa Risa. One of the volcanic hot springs in Arenal.
Wouldn’t you rather spend your money on experiences and improving your quality of life? Or perhaps bathe in volcanic hot springs in Costa Rica?
Not to say that if you’re smoking cigarettes you’re not taking vacations and enjoying life, but I want to give you a different perspective on how you’re currently spending your money on something that literally brings no substantial value to your life. Think about it.
Let me stop here for a moment and speak to all of my investors out there. If you are investing, then by now you should understand the value of compounding interest and you’re probably in a phase in your life where you want to build as much wealth as possible. So, lets revisit the national average for 1 pack of cigarettes, $7.84.
Let’s assume you begin to save $7.84 a day. In a month you’ll have $235.2 saved up. Invest the monthly savings into ETFs, mutual funds, or any of your preferred stocks. Let’s assume you earn 7% annual interest and you invest the monthly savings consistently for 5 years. By the end of the 5 years, you would have contributed $14,112 and the investments would have gained you $3,255 for a total of $17,367.05!!! So what about for 10 years? Total gains would be $13,501.23, after contributing a total of $28,224 in 10 years!!! Remember, this is all based on $7.84 bucks a day.
In those same 5 to 10 years if you choose to continue to buy cigarettes I can only imagine the devastating impact every puff will have to your health and every single organ in your body. The numbers speak for themselves here and you’ve already lost the health argument!
Here is the bottom line, if you’re like me, you’re motivated by a solid financial business case. You’ve most likely seen hundreds of commercials promoting the harmful effects of smoking and if that hasn’t changed your perspective then consider the costs of every cigarette pack you buy and the missed opportunities you have with saving and investing. Don’t think of it as just pointless saving goals or tell your self I’ll eventually stop. By putting away those $7.84 a day, the savings and investing opportunities will literally improve your quality of life. Make a drastic change in your life!
At the end of the day, it all comes down to holding yourself accountable to make an improvement in your life. If you need an accountability buddy, hit me up, but I have to warn you, when it comes to things like this I don’t play around (just ask my wife, I made her delete her Starbucks and UberEats apps)