Costs of smoking

[DaKini]

Yesterday i had some issue with a smoker and i was already very aware on how bad smoking is for your health and also finances.
However today i put together a small spreadsheet showing the financial outcome of opportunity costs, and whow, that blow my mind. I did not recognize until then, what big deal this is, even for moderate smokers...

I assumed that one pack costs 5 EUR and contains 20. Prices and ammounts vary around that (i verified this today).
Also assumed is that the saved money would be collected under the mattress over the year and invested as lump sum at its end.
When one smokes 25 pieces a day, i got the following numbers:
- at 1%: ~24k at 10 years, 50k at 20 years
- at 3%: ~26k at 10 years, 61k at 20 years
- at 6%: ~30k at 10 years, 83k at 20 years
Not smoking for 60 years and investing the difference at 6% would make one a EUR millionaire (Despite the real chance to be alive when that number hits...)
Not smoking for 30 years and at moderate 3% would give >100k EUR, equalling a small flat here.

Wow, just wow. I must have a calculation error somewhere, i cannot believe this.
As smoking is really just burning money, one could also bet the savings on very risky assets... so the returns assumed may be realistically too low.

[MooseOutFront]

No doubt it is really bad financially, but I'm reminded of the anecdote where 2 co-workers were talking about the costs of smoking and it goes like this:

CW1: How long you been smoking?
CW2: 20 years.
CW1: You realize if you had invested all that money instead of smoking you could buy a Dodge Viper with it by now?
CW2: ...Where's your Viper?

[RetiredAt63]

Way back when, DH and I had a week's Caribbean vacation, our first real vacation after years of grad school and a few years of working.  When we were telling friends about it (roughly same income and expenses) they couldn't understand how we could afford it (we paid cash).  We looked at the cigarettes in their hands and asked how much it cost them to smoke for a year.  Turned out to be within $50 of what we had spent on a wonderful vacation.  And even now, I do not regret the money we spent on that vacation, it truly was wonderful and memorable.

[GuitarStv]

No doubt it is really bad financially, but I'm reminded of the anecdote where 2 co-workers were talking about the costs of smoking and it goes like this:

CW1: How long you been smoking?
CW2: 20 years.
CW1: You realize if you had invested all that money instead of smoking you could buy a Dodge Viper with it by now?
CW2: ...Where's your Viper?

]

ROFL

[Brad_H]

Also don't forget to compare with the costs of other things classified as enjoyment, so lets assume your smokers are awake and smoking for 16 hours a day while they consume those 25 cigarettes.

Going to the Movies: 16/2*$6.50 = $18,980/yr direct cost, and - at 1%: ~$220k at 10 years, $443k at 20 years opportunity cost.

Guy: I saved a lot of money by walking home from work instead of taking the bus.
Other Guy: You could have saved a lot more by not taking a taxi.