The Cost of Smoking & Tobacco Use and Benefits of Quitting

Using tobacco products is just as hard on your wallet as they are your health. Whether you chew or smoke cigarettes, pipes, cigars, hookahs or smokeless tobacco, you’re likely spending thousands of dollars a year and paving the way to severe health conditions, such as heart disease, lung damage and cancers.

Explore ways to quit smoking and tobacco use, quickly improve your health and turn a financial bad habit into a nest egg, investment fund or a new financial planning opportunity.

The consequences of smoking and tobacco use aren't just limited to negative health impacts. It may also significantly affect an individual’s finances.

The National Cancer Institute puts the average cost of a cigarette pack at $6.28. Assuming that a person smokes one pack daily, that can quickly add up to $188 a month or $2,292 a year. If you’re a smoker, it can also hurt your finances in the long term. For example, monthly life insurance premiums for smokers are more than three times as expensive as for nonsmokers.

About 10.82 million consumers smoke 10 to 19 cigarettes a day. Assuming that a pack costs $6.28, you could spend between $1,146 to $2,292 a year on cigarettes. Remember, the price of a cigarette pack varies between states — smokers in New York or Illinois spend more than $10, which means their expenses are even higher.

Understanding how much you spend on cigarettes or tobacco use can help you realize how much you can save by regulating your usage or stopping entirely.

Let’s plot a cost scenario using New York’s highest price point of $12.85 per pack of cigarettes. That means each cigarette costs about $0.64 ($12.85 divided by 20 cigarettes equals $0.64).

Assuming you smoke 15 cigarettes a day, that comes out to $9.60 daily. Multiply your daily cost by seven (number of days of the week) and 30 (days in a month) to get your weekly and monthly expenses. So you’re spending $62.70 per week and $288 with your current consumption.

Spending $288 a month on cigarettes translates to $3,456 annually.

Most people already find covering monthly essential expenses challenging, without having to factor in the high cost of smoking. Smoking is considered a discretionary expense, meaning it is an optional cost. However, if you're unaware of your tobacco expenses, it may add to your financial stress.

Life insurance for smokers is typically more expensive, which increases your expenses further. It may also result in more costs associated with medical bills.

Insurers consider several factors when setting health insurance rates. These include your age, where you live and plan category, among other things. One factor that may drive your health coverage up is being a smoker.

Health insurance companies charge smokers up to 50% more in premiums because of the Affordable Care Act. It's because they’re more likely to develop health concerns, such as cancer, emphysema and lung diseases, which makes them riskier to insure.

Tobacco use is also a factor insurance providers consider when setting premiums for life insurance policies. The difference between smokers and nonsmokers can be significant since the latter has a shorter life expectancy.

For example, a 30-year-old male nonsmoker spends anywhere between $13.33 to $27.74, on average, for a 10-year term life policy with $500,000 coverage. In comparison, the range for smokers increases from $49.88 to $105.88 for a similar policy.

You’re more likely to develop illnesses such as cancer, heart disease, stroke, lung diseases and diabetes when you smoke. It also increases your risk for conditions such as tuberculosis and rheumatoid arthritis. All these, when treated, add to your medical bills.

The Centers for Disease Control and Prevention estimates that more than $225 billion is spent annually on direct medical care for adults.

Even if you don’t contract severe health conditions, it doesn’t mean you won’t experience side effects. You may notice your gums and teeth darken the longer you smoke. You’re three times as likely to lose your teeth and dental implants can set you back anywhere from $3,000 to $4,500.

According to Kelley Blue Book, it's difficult to remove the smell of cigarette smoke and may affect your car's overall value. Contaminants may bond with the car's material, making the odor problematic to erase. It may also cause discoloration to some areas of your vehicle. These may lower your car's value if you’re trading or selling it.

Unless another smoker tours your house, most prospective buyers won’t appreciate the smell of smoke. It may even cause people with delicate dispositions to experience physical symptoms. These may include shortness of breath, headaches or sore throats, making them think twice about putting in an offer.

Attempting to remove the toxins causing the smell of cigarette smoke can be costly, and not all buyers are willing to take on that expense. Your home’s selling price may decrease by 30% if you smoke inside.

The harmful effects of smoking reach far beyond your finances. Besides having higher health insurance premiums, most people are aware of the numerous consequences to our physical health. However, smoking also impacts various areas of our well-being.

Tobacco use can change your physical appearance, whether it’s damaged teeth and gums or poor skin tone. You may also experience social stigma if you’re a smoker. Smoking is also closely associated with increased anxiety levels and a higher propensity for depression.

• Dangers of social smoking: Some people only smoke during gatherings, which means they don’t smoke regularly. However, it doesn’t mean that there aren't any consequences. Social smokers tend to smoke in groups, which exposes them and others to secondhand smoke. Alcohol is often present in these situations because it’s an activity connected to smoking.
• Deterioration of physical appearance: Your skin doesn’t get enough oxygen and nutrients when you smoke, resulting in poor skin tone. The chemical in tobacco also destroys collagen and elastin, causing your skin to sag prematurely.
• Increased complications during pregnancy: According to the CDC, female smokers are more likely to experience an ectopic pregnancy. If it’s continued during the pregnancy, it may cause the baby to have low birth weight, even when delivered at full term. They’re also more likely to have children with cleft lips.
• Addiction: A primary chemical found in tobacco is nicotine, which causes changes in the brain. When you don’t get your supply, you experience withdrawal symptoms. This process promotes the continued use of tobacco and may eventually lead to addiction.
• Higher levels of stress: People feel an instant sense of relaxation when they smoke, which leads them to believe that smoking helps them de-stress. However, this feeling is temporary. When you lose it, you may end up craving it more. It also triggers withdrawal symptoms, which cause more tension and anxiety.

As you would expect, several benefits come with quitting smoking. You can break out of the addiction cycle that encourages you to continue the habit, increasing your mental well-being. Other health benefits include better vision, clear skin, lower cholesterol and an improved immune system.

Financially, you’ll be able to get lower insurance premiums when you stop smoking. After 12 months of not smoking, you can qualify for nonsmoker rates.

One of the most significant benefits of quitting smoking is how it can enhance your overall health condition. Whether you realize it or not, changes in your body begin in minutes. For example, your blood pressure lowers and your heart rate drops. That's just 20 minutes after your last cigarette. Imagine how much improvement you can expect after several months or even years.

• Eight hours after quitting: Your blood’s carbon monoxide levels begin to decrease while the amount of oxygen in your bloodstream increases. Since the body needs the oxygen to create energy, having more of it translates to better performance from our mind and body.
• One day after quitting: You're less likely to have a heart attack. The continuous increase of oxygen in your blood reduces the constriction of veins and arteries. The nicotine in your system begins to decrease.
• Two days after quitting: You’ll begin to notice the improvement in senses that dulled when you were smoking. These may include your vision, hearing or taste. Any nerve endings that were damaged begin to regrow at this point.
• Three days after quitting: You’ll notice increased lung capacity, which means you can fill your lungs with more air. The bronchial tubes are also beginning to relax and open up, making it easier for you to breathe.
• One week after quitting: Seven days after your last cigarette is a milestone. Smokers who reach this point are more likely to kick the habit permanently.
• Two weeks after quitting: Your lungs perform 30% better. Improvement in your health isn’t limited to your breathing. You’ll notice that you’re not as exhausted as before when you walk.
• One month after quitting: Fibers that allow for healthy lungs begin to regrow. You have more energy and do more physical activities without experiencing shortness of breath.
• Three months after quitting: Women are at lower risk for having complications during pregnancy. It reduces the probability of premature births.
• Six months after quitting: You’ll notice the urge to smoke isn’t as strong even when you find yourself in stressful situations. Your airways are less inflamed since they haven’t been exposed to the chemicals in cigarettes for a while, so you don’t cough up that much phlegm.
• One year after quitting: Your breathing isn’t labored even if you’re exerting yourself. You also cough less compared to when you were still smoking. The risk that you’ll get a heart attack reduces significantly.
• Five years after quitting: You're less likely to have a stroke. There's only half a chance of getting cancer in your mouth, throat and larynx.
• 10 years after quitting: Precancerous cells have been replaced by healthy ones, reducing your risk of developing lung cancer in half. You’re also less likely to have smoking-related illnesses.
• 15 years after quitting: The risk that you’ll develop coronary heart disease reduces — it’s now close to that of a nonsmoker.
• 20 years after quitting: You’re as likely to get mouth, throat, larynx and pancreatic cancer as someone who never smoked. Women’s risk of cervical cancer is reduced by half.

When you quit using tobacco products, you can use the money you used to spend on cigarettes elsewhere. At the very least, you’ll have extra income to play around with in your household budget. Or, you can invest the additional funds. It’s an effective way to put your money to work — by adding it to a savings account, it will earn interest over time.

• More savings: On average, a pack of cigarettes costs $6.28. Assuming you’re a one-pack-a-day smoker, you’ll spend $188.40 a month. Multiply that by 12, and you get $2,260.80. Now, if you stop smoking, where does that money go? Back in your pocket (or your savings account)!
• Lower healthcare expenses: You're more likely to develop more severe health problems when you smoke, such as heart disease, chronic obstructive pulmonary disease and cancer. When you stop smoking, the likelihood of you developing these reduces. Although it’s ideal to have an annual check-up, you can avoid additional expenses from specialists and treatments.
• More affordable insurance premiums: Insurers cannot deny smokers coverage, but they can charge more for premiums. The Affordable Care Act allows providers to increase insurance rates by 50% for smokers. Quitting smoking can help you lower costs since you can qualify for nonsmoker rates 12 months after your last cigarette.
• Less cleaning costs: Smoking doesn’t just damage your health — it may also ruin your home or car. Cigarette smoke sticks to soft materials, so if you have carpets or curtains, they may start smelling like smoke if you light a cigarette indoors. Having them cleaned adds expenses you can avoid if you stop smoking.

On average, a pack of cigarettes costs $6.28. That’s how much you’ll save daily, assuming you break the habit of smoking one pack a day. You can have as much as $188.40 monthly. You can use that for other items in your household budget or invest it.

Investing may seem risky, especially if you’re new to it. You can choose a safer option, but it opens you up to opportunity cost. Investing can be rewarding, especially when your money begins to earn.

For example, you can put your $188 into an investment with a 10% return rate that compounds monthly. Adding the same amount at the start of each month can earn you an additional $145.70 in interest.

Smoking cessation can be challenging, but JAMA's study found that using smartphone applications can help. These offer multiple benefits, such as connecting you with a community that can provide support. You can also learn to identify your triggers and develop new coping mechanisms. It’s best to choose an app that allows you to engage with its content since it results in a higher cessation probability.

• QuitNow: This app offers various goals to help you quit. You can find support through their chatbot to find answers that aren’t in their FAQs. Most importantly, it connects you to a community of individuals who can offer encouragement.
• Smoke Free: Best for smokers who want to track how much time has passed since their last cigarette. The app connects this with how much your health has improved and how much money you’ve saved. You can also identify contributory patterns to your cravings to better manage them.
• Easy Quit: This app shows you how different areas of your health improve as you continue to resist smoking. You can use their slow mode if you want to stop slowly. It also has a memory game that serves as a good distraction when you’re craving.

You don’t have to go through smoking cessation on your own. Although some individuals can cope with the use of apps and the support of their friends and families, others need additional assistance.

There are several support services and programs for smokers trying to quit and these come in various channels. More than the traditional cessation programs, you can also find assistance through chat, phone and text.

• Freedom from Smoking: This cessation program of the American Lung Association (ALA) is more than three decades old. It provides a systematic approach to quitting through multiple modalities. You can find support online, via phone, through self-help resources or in-person.
• Nicotine Anonymous: NicA has a 12-step program to help you live a nicotine-free life. It can be an additional source of support for those undergoing a smoking cessation program and using withdrawal aids.
• LiveHelp: The National Cancer Institute (NCI) provides a chat line that connects you with a specialist. However, it does not offer medical advice since you are still encouraged to see a health professional if you’re experiencing withdrawal symptoms.
• Smokefree Text Messaging Programs: You can get encouragement, advice and tips as you go through your cessation journey. The NCI offers multiple programs, so you choose which fits you best. It’s a free service that you can sign up for and opt out of it anytime.

There are a lot of beliefs about smoking and tobacco use that have been passed down through generations, but some of them may not be accurate. Understanding the truth behind some myths can help you make better health choices. MoneyGeek explores some of these beliefs and provides the real deal behind each.

There are multiple resources online that can help you in your smoking journey. Some calculators can help you understand your potential savings or risk level. Should you want to explore investing, you can try using apps designed especially for beginners. You’ll also find tools to help you when you’re ready to stop the habit.

• Smoking Risk Calculator: Smoking decreases one’s lifespan. Use this calculator to determine how many days you’ve lost based on the number of cigarettes you’ve smoked.
• How Much Will You Save?: The NCI’s calculator can help you determine how much money you can save in a day, a week, a month and a year. You can personalize it by putting in the exact amount you pay per pack and the number of cigarettes you smoke each day.
• Compound Interest Calculator: Put the money you’ve saved into good use. The compound interest calculator can give you an idea of how much your money will earn over a period of time.
• Investment Calculator: If you’re wondering whether investing is worth getting into or not, this calculator may help you with your decision. It shows you how much you can earn based on the return rate and compounding frequency.
• Pack-Year Calculator: You can know your smoking exposure by calculating your “pack-years.” It tells you how many cigarettes you’ve smoked in your lifetime — you may be surprised at what the figure you get!

• Acorns: Those new to investing can start with Acorns. More than proving an investing platform, it also shares money tips and techniques. Expanding your knowledge allows you to grow your money more effectively.
• Stash: An app that helps you in various financial areas, from budgeting to saving for retirement. Their services are customized based on your answers to initial questions about your financial goals. You can also get personalized advice on investing and budgeting.
• Invstr: You can practice your investment skills through Fantasy Finance, where you manage a virtual portfolio worth $1 million, risk free. When you’re ready for the real thing, you choose from US-listed stocks and invest in fractional shares as low as $5.

• Quit Genius: A free app that uses Cognitive Behavioral Therapy (CBT) to help you stop smoking. You have control over your cessation goals, so it doesn’t force you to quit immediately. Rewards are shown as the amount you’ve saved and the number of years you’ve regained.
• Kwit: An app that also utilizes CBT practices but also uses other tools. You’ll have a personalized dashboard to help you track your progress and a diary for your cravings. Kwit also provides instant motivation cards, which gives extra encouragement.
• National Cancer Institute’s Quit Plan: Having a roadmap when you’re trying to quit smoking can help you stay on course until you’ve reached your objective. The NCI’s Quit Plan walks you through six steps to personalize your smoking cessation journey.
• The CAGE Questionnaire: Most people think of smoking as a habit, not an addiction. This questionnaire has four questions that can tell you whether or not you’re addicted to smoking.