Lifetime Smokers £500,000 Worse Off by Age 75

How Much Smokers Smoke in the UK

On average, smokers in the UK light up 10.9 times per day, 332 times per month or 3,979 times per year. Men smokers smoke more than women smokers—11% more to be exact. And older people tend to smoke more than younger. For example, amongst men those aged 60+ smoke the most (14.9 cigarettes each day) while amongst women those between 50 and 59 years of age are the heaviest smokers (12.2 cigarettes per day).

How Much Smokers Spend on Cigarettes

A pack of 20 Stirling cigarettes, one of the most popular brands in the UK, costs around £9.24. When tallied up over a month, year or lifetime of smoking, the costs really rack up. For example, the average lifetime smoker would spend around £114,000 on cigarettes between the ages of 16 and 75.

How a Lifetime Smoker is £500,000 Worse Off

While the money spent on smoking over a lifetime (over £100k) is shocking on its own, the true financial cost of smoking is even higher. If a smoker invested their smoking money each year instead of puffing it away, they could have nearly £500,000 tucked away by age 75, assuming 4.5% annual after-tax returns. Money invested when you're young can grow substantially over time due to compounding—earning returns not only on the money you invest (e.g., the money not spent on cigarettes each year) but also on the returns from previous years.

Even those earning lower rates of return could have a significant pot of money set aside—for comparison sake, 3% after-tax investment returns would still yield £288,000 by age 75, had someone invested their money instead of buying cigarettes.

Methodology

To understand how much people smoke in the UK, we first analysed data from the Office of National Statistics according to different age groups. We then applied the cost of a pack of 20 Stirling cigarettes from Tesco (£9.24) to the average amount smoked in each age group, to see how much people spend across the years and over a lifetime of smoking.

In order to calculate how much a lifetime smoker could have in wealth by age 75 had they not smoked, we assumed that at the end of each year they invested the money they would have spent on cigarettes and that they started smoking at age 16. We used an investment return rate of 4.5%, which is less than the 6.4% average FTSE return over the past 25 years to reflect taxes or suboptimal investing. Of course, there is no guarantee that historical returns will be repeated—someone achieving a lower return would have less money by age 75, someone achieving a higher return would have more money by age 75. You can see how the data for how wealth accumulates over time in the table below.

Limitations of this study

For our calculations we assumed that a lifetime smoker smokes according to current smoking rates for each age of life, using the most recently available Office of National Statistic data from 2017. However, since smoking rates have trended down over time it's possible that the numbers in this study are too low for older generations and too high for young generations. Similarly, the cost of a pack of cigarettes changes over time—using the current cost of £9.24 across all ages will hopefully produce a reasonable metric for the average cost of a pack of cigarettes over the life of an average smoker today. Finally, there is of course no guarantee on investment returns—we selected 4.5% as a reasonable approximation given FTSE returns over the past 25 years, but ultimately this exercise is for illustration purposes only.