A smoking joke that just got serious

The joke goes like this.

There’s a guy taking a smoke break with his non-smoking colleague.

“How long have you been smoking for?” the colleague asks.

“Thirty years,” says the smoker.

“Thirty years!” marvels the co-worker. “That costs so much money. At a pack a day, you’re spending $1,900 a year. Had you instead invested that money at an 8% return for the last 30 years, you’d have $250,000 in the bank today. That’s enough to buy a Ferrari.”

The smoker looked puzzled.

“Do you smoke?” he asked his co-worker.


“So where is your Ferrari?”

According to the National Cancer Institute, the average cost of a pack of cigarettes is $6.28, which means a pack-a-day habit sets you back $188 per month or $2,292 per year. Certainly, the amount is an average and it may differ from one country to another.

Now let’s do some maths with some simple calculation below:

  1. Save for a year and started to invest with a capital of $2,292. Subsequently, invest monthly $188.
  2. Simply put all your money invested into SPY (which is the S&P500 index ETF).
  3. From 1 January 1994 to 30 September 2020 (total of 26 years and 9 months), your account balance will have $330,955!
  4. Note that it covers the dot com bubble, the 2008 financial crisis, and the coronavirus crash, yet your account continues to grow.

Key takeaways:

  1. It is not difficult to learn how to invest, some investment strategy can be simple yet effective.
  2. Invest early regardless of any amount. It is a myth to believe that you need a high capital to start investing.
  3. Quit smoking and start investing!