Saving More Than Just Money

By Cassie Kauffman, MA

"The first wealth is health." -Ralph Waldo Emerson

It is incredible to think about all the money that comes in and out of our hands every month and every year. If we had saved all that money we would be rich, we might think. Of course, as an adult, there is always going to be something we need to buy including the necessities of a place to live and food to eat. But what about all those "extras", the little things we don't think too much of unless we stop to add them up. There are money advice books that talk about the "latte factor" which is adding up the cost of a Starbucks or other brand of coffee and realizing that the small changes in our lives can add up to a large amount of cash. Well, how about the "tobacco factor"?  It may be much easier to stop the latte habit than the cigarette addiction, but of course they both add up to quite a bit both in terms of guarding our well-being and saving our finances.

What a great opportunity it is to have a chance to not only create better health, increase longevity in order to spend more time with those we love AND have the added bonus of saving a great amount of money. For instance, if a person smokes about a pack a day at $4 per pack, 365 days a year, that is $1,460 straight out of the pocket into the hands of the cigarette company, let's say, Philip Morris, manufacturer of the leading brand of cigarettes, Marlboro. Now some might say that's not too much, until they add in the costs of being sick, missing work and possibly losing a job or becoming permanently disabled, then it becomes a little more costly. For now, though, let's focus on the financial value of that easily extracted money, that 'disposable' income, if you will.

Most people who can afford a pack a day cigarette addiction are no longer teenagers. They are adults with jobs and earnings. They may even be saving for retirement or for their own children's education. Unfortunately, cigarette smoking and tobacco use in general is associated with higher rates of poverty and social disadvantage, therefore the opportunity costs for these adults to have at least $1,460 EXTRA to spend on tobacco instead of housing, food, vacations, clothing, etc is even greater when taken as a percentage of income. Now let's assume at least 5 years of smoking. That is over $7,000 spent just on tobacco. Let's also assume that this particular person thought favorably of the tobacco industry. If that person hadn't smoked for those 5 years and had put the $7,000 into Philip Morris stock instead of smoking it, they would have nearly doubled their money to $14,000 and would probably feel a lot healthier in both the body and the wallet.

Instead of thinking like a consumer, especially in the case of tobacco, think like an investor. For the sake of those who would never buy stock from a tobacco company (of which there are quite a few), think about what that $7,000 investment could earn in a direct investment such as a down payment for a house, a rental property or even a modest Certificate of Deposit. The house could have built up equity nearly 3 times the initial down payment, the rental property could be bringing in additional cash flow each month and even the CD would have grown substantially. By stopping tobacco use, the person is starting to control finances and health in a strong way. No longer is he at the whims of the industry to raise prices, or of regulations to increase tobacco taxation. No longer does she have to pray that her health will keep strong; she controls it. Money and health are two of the most empowering things a person can have in their lives. What a tremendous prospect the tobacco user has that few others will have. Except maybe those latte drinkers.