I made the following assumptions:
1. You smoke a pack a day
2. A pack costs $10.00
3. You smoke from age 18 to age 65
4. You could invest and receive 8% on your money otherwise
Based on that…
Your monthly cost of smoking is $300.00
Your annual cost of smoking is $3,600.00
But here’s the kicker: If you instead took that money and invested it, assuming no transaction costs and assuming that you can earn 8% on average per year, a smoker could’ve accumulated $1,876,137.97 by age 65. Yes, almost two million dollars!
I created a calculator you can download to figure out the cost with different assumptions (higher/lower smoking frequency, different number of years until retirement, different cost per pack of cigarettes, higher or lower rate of return on investments).