5 ways to save by quitting smokingNational No Smoking day - 9 March 2011
09 March 2011
National No Smoking Day takes place today as figures from the Office for National Statistics (ONS) show that nearly two thirds (63%) of current smokers in Britain are keen give up smoking.
The ONS research found that while health concerns were the most commonly mentioned reasons for people wanting to quit smoking, the next big motive was cost, with 31% of people citing it as the reason they wanted to stop. Giving up not only improves your health, but it can also give your finances a considerable lift. Below Which? shows you five great ways you can save money by dumping cigarettes.
More in your pocket
Smoking has been estimated to cost the NHS £5.2 billion a year. And at an average cost of £6.40 for a pack of 20 cigarettes, a 20-a-day smoker could save themselves around £2,336 a year by kicking the habit - a huge saving you could put towards anything from a new home cinema system or a family holiday.
Best rate savings accounts
Best rate instant-access savings accounts are currently paying lower rates than the best instant-access cash Isas. So, if you're happy to tie up your money longer term, a fixed-rate savings account could be a good place to invest all your cash saved by stopping smoking. For example, Aldermore's Five-year Fixed Rate Bond currently pays 4.90%.
The money you save by quitting could also be invested into a best rate cash isa. For example, if you deposited £2,336 into Santander's Flexible easy-access account paying 3.15%, you could earn more than £70 over the course of a year.
If you feel ready to invest in the stock market, you may also want to consider putting the money in a stocks and shares Isa.
Life insurance best buys
Life insurance premiums for smokers can be almost twice as high as they are for non-smokers. For example, a level-term policy offering £100,000 worth of cover over a ten-year term would cost a 54-year-old male smoker £52.18 with AA Insurance Services, compared with just £25.08 for a non-smoker - a vast saving of over £300 over a year.
Once you've successfully quit, it's worth contacting your insurer after a year to discuss a review your premium. Visit our guide to life insurance for much more information and advice.
Health and medical insurance
As smokers are more likely to die or have serious health problems, products such as critical illness cover or private medical insurance (PMI) which pay out on death or serious illness are normally a lot more expensive.
PMI covers the cost of being treated privately, either at a private hospital or in a private NHS bed. These types of cover should only be considered if you have good income protection in place.
Both critical illness cover and income protection are likely to be cheaper if you're a non-smoker. Critical illness cover pays a lump sum if you get a serious condition or illness, such as cancer, or if you have a heart attack or stroke. However, this is a luxury product that should only be bought in addition to income protection cover.
Which? Money when you need it
You can follow @WhichMoney on Twitter to keep up-to-date with our Best Rates and Recommended Provider product and service reviews.
Sign up for the latest money news, best rates and recommended providers in your newsletter every Friday.
Or for money-saving tips, and news of how what's going on in the world of finance affects you, join Melanie Dowding and James Daley for the Which? Money weekly money podcast
For daily consumer news, subscribe to the Which? news RSS feed here. And to find out how we work for you on money issues, visit our personal finance campaigns pages.