It's a fact that as well as being extremely damaging to your health, smoking is also extremely damaging to your wealth! Now that the UK is smoke-free at work and in enclosed public spaces, why not quit? You could easily save £50,000 not just on the cigarettes but on common financial products too. This is the no-buts guide to giving up on the cheap.
The Direct Costs Here's the simple rule of thumb to work out roughly how much you spend on cigarettes at current prices:
Average number of cigarettes smoked per day
x £100
= Annual Cost
1 cigarette a day is £100
10 cigarettes a day is 1,000
A packet a day is £2,000
Think what you could be spending this on!
The Hidden Costs
The MoneySaving gain from smoking isn't just about the reduced outlay in newsagents. There's a further, hefty cost to smoking; many financial products add a huge whack on smokers... and there's a very simple reason.
So what's the additional cost?
Smoking impacts any product where the process depends on the likelihood of illness or death. Common medical opinion is that the benefits of exercising, eating well and losing weight pale into insignificant compared to the benefits of quitting smoking, as the risk from most smoking related illnesses decreases rapidly after quitting.
Let me put it another way....
Smokers are more likely to die or have serious illness. So products which pay out on death or illness are a lot more expensive!
So, quit smoking and you'll save money a mass of products.
The hidden cost could be as high as £37,000 over 20 years!
I've calculated the real cost of smoking, by looking at the increased amount smokers have to pay on standard financial products. If you had term assurance, critical illness, private medical insurance, permanent health insurance then typically you'd pay £37,000 more on them as a smoker over 20 years than a non-smoker. Here's a product by product breakdown....
Term Life AssuranceApproximate non smoker saving 55%
There are two main types of term assurance, one that covers your mortgage and one that is designed to pay out a lump sum to protect your family's finances in case you die. Both only pay out if you die within a fixed term and as such, costs increase the more likely you are to die within the set period of your policy.
| Price of 200,000 policy over 20 years | ||
|---|---|---|
| Price for smoker | Price for non smoker | Price Difference |
| £11,600 | £5,350 |
£6,250 |
| Prices for single man aged 40 | ||
However it's worth noting, whether you smoke or not, most people are paying substantially more than needed on their term insurance; and its very easy to slash the cost.
Full MoneySaving Articles:Life Insurance: Pay less to protect your family
Mortgage Life Insurance: Cut the cost of protecting your home
Critical Illness Insurance
This pays out a lump sum if you're diagnosed with one of a pre-defined list of critical illnesses and has a high smoking price difference. The increased cost also reflects the fact that the payment is all in one big lump sum.
At this point it's worth me saying that if you have Critical Illness Insurance as well as Term Life Insurance you can get a much cheaper policy if you combine the two, with prices being around 25% for both smokers and non smokers.
| Price of 200,000 policy over 20 years | ||
|---|---|---|
| Price for smoker | Price for non smoker | Price Difference |
| £50,000 | £26,000 |
£24,000 |
| Prices for single man aged 40 | ||
In general I'm not really a fan of critical illness policies at all. You'll find more detail in the Life Insurance: Pay less to protect your family and Mortgage Life Insurance: Cut the cost of protecting your home articles. Critical Illness Insurance
Approximate non smoker saving 5%
This provides medical treatment and hospital accommodation and while most polices cost the same for smokers and non smokers, some do cost more.
Providers usually make a detailed analysis of your health, even if only via a phone questionnaire, so smoking related issues are taken into account in their own right, leaving the actual fact that you smoke as a side issue and hiding the real cost.
See my full article for more info: Private Medical Insurance, cost cutting plan
Permanent Health Insurance
Approximate non smoker saving 25%
This is often called an income replacement plan as it pays out a proportion of your salary if you're incapable of working after a set amount of time. The payments stop once you return to work.
| Price of salary cover of £25,000 | ||
|---|---|---|
| Price for smoker | Price for non smoker | Price Difference |
| £25,500 | £18,500 |
£7,000 |
Prices for single man aged 40 with 4 weeks deferment period |
||
If you smoke once in a year, you're a smoker, so while you may not be spending on cigarettes you are costing yourself massively on financial product.
Most polices rely on your honesty when it comes to declaring whether you smoke and lying is easy but can be disastrous, so if you're thinking of lying about smoking, don't! If you get a smoking related illness it can invalidate all claims, not just smoking claims, and it is potentially fraudulent.
If medical or other evidence of your habit is discovered, your provider can, and probably will, legitimately refuse to pay out and not even refund your premiums.Even people who have mostly, but not completely, stopped smoking may be detected and lose out this way.
The one time smoking pays
The one time smoking does help you is at retirement when you trade your pension savings in for an Annuity. This is a payment per year for the rest of your life, and as smoking shortens that, you get a better rate.Yet unsurprisingly, you don't get the benefit after one quick drag, in this case you need to have been smoking for ten years to count.
Now I wouldn't suggest to anyone this is a reason to take up smoking, after all you only get more as you're likely to die sooner.Yet if you are a smoker about to retire, you may just want to wait until the day after getting your annuity to quit!
What to do when you've quit
If you quit smoking, always notify providers when you quit, and then do it again after you've been smoke free for a year.At this point if you have any of the policies listed in the hidden costs list, you should immediately go back and try and get them cheaper.
In fact the saving is so large, you should put a note in your diary to remind yourself the week before the year's anniversary, so you can go and get new quotes for all your policies (use the article links above to find the cheapest).
MoneySavers don't smoke! Cheap ways to quit!
It's accepted that it's not easy to give up smoking but it's thought that around 70% of smokers actually want to quit.Worse still a whole industry has now built up around selling highly profitable stop smoking gear, patches, medicines and more.Yet it's possible get help, support and aid without spending too much cash.
The NHS
There is excellent free support available from the NHS, including its local Stop Smoking Services and the Together Programme.
Stop Smoking Clinics
These provide free local support from a trained adviser, either in groups or one to one and can also often supply free nicotine replacement products. Find your nearest.
The Together Programme
If you're unable to get to a Stop Smoking Clinic, this programme will help with text, e-mail or postal based motivational reminders.
To find out more about both services visit the gosmokefree website, text ‘GIVEUP' and your full postcode to 88088 or ask at your local GP practice, pharmacy or hospital. You can also call the NHS Smoking Helpline on the following numbers:
England 0800 169 0169
Scotland 0800 848 484
Wales 0800 085 2219
Northern Ireland 0800 858 585
Free or Cheap Nicotine Replacement Products
Getting stop smoking patches can be costly, they're typically around £15 a week to buy and tend to used for 12 weeks meaning a total outlay of around £200. Though of course it depends on your will-power, how effective you find them and how much you smoked. Luckily there are some easy ways to cut the cost.
- Stop Smoking Clinics. As detailed above there are special NHS clinics which give patches and chewing gum out for free.
- By Prescription. If the clinic in your area does not provide free products you should be able to get them from your Doctor on prescription, which should work out a lot cheaper than buying in the shops.For someone that pays for their prescriptions (see Cheaper Prescriptions and Medications) you should be able to get an adequate supply for the £6.85 prescription cost
- Prescription prices without a prescription. It may not be necessary to go to your GP/local stop smoking clinic to get a prescription. Some higher level pharmacists in England are entitled to give some products, including nicotine patches, on prescription by themselves. It's worth popping in to your nearest chemist to see if they have a pharmacist who is able to do it.
- Buying them for less. The situation changes all the time, online pharmacies can be cheap for buying in bulk.If you find a good supply of legitimate products at a low cost please report them in the cheap nicotine replacement products forum discussion.
Free or cheap help, support, books and CDs
As well as products there are many good resources available online for free.
- Smoke-Free Wannabee.Many MoneySavers are trying to quit, or already have and they congregate to support each other and discuss the best low cost methods in the site's Forum.There are a variety of discussion and threads, take a look or join in at Smoke-Free Wannabee (scroll down past poll to see thread).
- Get the Allen Carr's Clinic course for ¼ the price. Allen Carr was one of the world's most famous stop smoking gurus. His course was recognised as a leading expert on stopping smoking, and has franchised out his course to various clinics across the country.Yet they're not cheap with a standard price of over £200.However if you have £55 worth of Tesco Clubcard vouchers you can get it for 75% off. Tesco Allen Carr Details or read more about Loyalty Point Loopholes
- Other Free Support Websites. As well as the official NHS Helpline, there are lots of other websites that offer support including Quit.org, Ash.org and Boots Commit To Quit.
- Other Freebies. As always the web is a huge resource of info you can find the ‘Stop Smoking - Break the Chains Ebook' the ‘Quit Because Pack' and the ‘Stop Smoking Hypnosis MP3'
Ask A Question / Forum Discussion
Quit Smoking Support
Always double check the product details before signing up to them
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