Quitting Cigarettes = Better Health + Heavier Wallets

My Latte Factor – Cigarettes

Inspired by reading the Automatic Millionaire by David Bach, I realized that Smoking was formerly my ‘Latte factor’. The author encourages the readers to breakdown how they spend their money and identify their latte factor. The latte factor is described as expenditure on some wants that one can cut back on in order to make some significant room for savings and investments. While I am frugal and quite non-materialistic, I do like to keep some wiggle room for some things (wants) from time to time. Smoking, however, was a different beast. It did give me instant gratification but also took a lot out of my wallet every few days.

Quitting was Hard

Quitting full-time smoking was among the hardest things I did. As a guy who loves the concepts of averages, I thought why not come up with a few numbers to support this good initiative. Perhaps, even motivate some of you trying to quit. I came to Canada and brought with me this habit. From September 2014 to July 2018, I smoked about 10 cigarettes a day. In my attempt to quit, I started vaping alongside smoking for a few months in 2018 too. In retrospect, I am not sure how much vaping helped me but I do know that my monthly smoking/vaping costs remained the same if not saw increase under this attempt. Also, I tried quitting at least 20 times before July 2018. Quitting is hard but keep up the intent and you will hopefully follow through one day too.

Quick numbers (and a few emotions)

Reduced Monthly cashflow: A pack of smokes (20) was about $12 when I started and about $14/15 when I stopped. For the purposes of being conservative, let’s keep the price at $12 per 20 cigarettes. Cost of smoking per year: $2,160 conservatively. Cost of smoking through this tenure: upwards of $8,000 easy. Keep in mind that I was a student for a significant portion of this tenure and so every dollar counted.

My Life Insurance costs: I got Life Insured in December 2016 on a Smoker’s plan. My insurance premium is $41 monthly. Quite low but I could have gotten the price of $27 if I was a non-smoker. A differential amount of $14 a month. A lower number but it adds up over the course of the many months. The amount nets to over $300 in the analysis period.

The added cost of partying and travelling: The average number of cigarettes in #1 does not include the extra consumption at social events and travelling. My nicotine consumption was much higher when I partied. My nicotine and caffeine consumption were much higher when I travelled. Alcohol (or coffee) and cigarettes seemed supplemental and one more of either was always welcome then.

The Non-Financials: My bosses noticed the empty desk at work multiple times a day, my rental applications were turned down and my spouse objected (and more). I think being social and smoking in my mind were also highly correlated at this point in time.

In Conclusion

While the numbers do not seem to be a lot for me, note that I am only analyzing my habits for a period of under four years. For someone that smokes at the same pace I did but for 30 years, the cost would be quite significant. Daily consumption of 10 smokes a day would be upwards of $65,000 over 30 years. This is inflation unadjusted. Adjusted for inflation at 3%, this would be over $120,000. I think I am being rather kind here. Per the US Bureau of Labor Stats, cigarettes had an average inflation of over 7% per year between 1997 and 2021.

If they have a Life Insurance policy the same as mine, the premium costs would be over $5,000 for 30 years. The added cost of smoking in social settings and travelling would be a lot higher too. My analysis is conservative and does not include the long-term medical costs associated with smoking. The cost of these could run into hundreds of thousands of dollars additionally.

I am not saying, you should invest the money or buy a house with it. I just wanted to acknowledge in retrospect that it was my latte factor. If it is yours currently, I hope this piece motivated you to make cutbacks at the minimum.