The high cost of smoking

By Hilary Smith

If the threat of cancer can't persuade you to quit smoking, maybe the prospect of poverty will.

The financial consequences of lighting up stretch far beyond the cost of a pack of cigarettes. Smokers pay more for insurance. They lose money on the resale value of their cars and homes. They spend extra on dry cleaning and teeth cleaning. Long term, they earn less and receive less in pension and Social Security benefits.

Indeed, being a smoker can not only mean you don't get hired -- you can get fired, too. After announcing it would no longer employ smokers, Weyco, a medical-benefits administrator in Michigan, fired four employees who refused to submit to a breath test. It began testing the spouses of its employees, too, levying an $80-per-month surcharge on those who don't test clean.

Overall, 5% of employers prefer to hire nonsmokers, according to the most recent survey by the Society for Human Resource Management, and 1% do not hire smokers. A few examples:

• Kalamazoo Valley Community College in Michigan stopped hiring smokers for full-time positions at both its Michigan campuses.
• Alaska Airlines, based in Washington state, requires a nicotine test before hiring people.
• The Tacoma-Pierce County (Wash.) Health Department has applicants sign an "affidavit of nontobacco use."
• Union Pacific won't hire smokers.

That same poll found that 5% of companies charge smokers more for health-care premiums. The costs don't stop with your paycheck. Figures from the Campaign for Tobacco-Free Kids assert that smokers cost the economy $97.6 billion a year in lost productivity.

That's based on the number of working years lost because of premature death. (The Bureau of National Affairs says 95% of companies banning smoking report no financial savings, and the U.S. Chamber of Commerce finds no connection between smoking and absenteeism.)

An additional $96.7 billion is spent on public and private health care combined, according to the Campaign for Tobacco-Free Kids, and each American household spends $630 a year in federal and state taxes due to smoking.

Personal financial impact

The cost of a pack of cigarettes averages around $4.50 to $5, including taxes, depending on where you live. Using the lower number, a pack-a-day smoker burns through about $31.50 per week, or $1,638 per year. That's a fat house payment or a nice vacation with the family. A 40-year-old who quits smoking and puts the savings into a 401(k) earning 9% a year would have nearly $250,000 by age 70.

But only you know exactly how much you pay and how often. Plug your yearly tally into our Savings Calculator and see what it'll cost you over the coming decades.

The one place many smokers feel free and comfortable to light up is in their car. Without consistent and thorough cleanings, however, a car that is smoked in will soon start to resemble an ashtray on wheels. The interior inevitably smells like smoke, and stray ashes and butts can burn holes in the upholstery and floor mats.

None of these things has much financial impact until you try to sell the car. Figure a minimum of $150 for a good cleaning with an extractor.

On a trade-in, dealers can easily knock off more than $1,000 on higher-end vehicles. Terry Cooper, a car dealer with seven new- and used-car stores, says he took a 1999 Porsche 911 Cabriolet in on trade for $37,000. That sounds OK, but the owner could have fetched $40,000 for it had he not "smoked out" the car's interior.

The criteria that apply to cars apply to homes as well, only on a bigger scale.

Smokers' houses often require all new paint and/or wall treatments, as well as professional drapery and carpet cleaning. According to Contractors.com, priming and painting an average-size living room, dining room and two bedrooms would cost more than $2,000. The Carpet Buying Handbook puts the average cleaning cost per square foot at 28 cents, and the average home has 1,000 square feet of carpet. That's $280. Add $55 to clean a typical sofa and $25 for a chair, says Diversified Carpet in San Diego.

Walt Molony with the National Association of Realtors says that "certainly the smell of cigarettes can be a turnoff to potential buyers."

Continued: Some states charge employees extra for health coverage

 1 | 2 | next >