Die with Zero

What if delaying gratification and saving for retirement isn’t the responsible way to live? What if it’s actually causing you to waste your life?

1. Time is a limited resource, treat it wisely

Time is finite, and its value surpasses that of material wealth. Yet many people act as though time is infinite, delaying opportunities and experiences. The story of John and Erin illustrates this vividly. When faced with terminal cancer, John and Erin decided to maximize the time they had left, creating lasting memories. This underscores how life can change abruptly, and waiting for tomorrow to enjoy today is risky.

Too often, young individuals prioritize saving for a distant retirement over enjoying life in the present. Financial responsibility is important, but it shouldn’t come at the cost of missed experiences. For instance, climbing the Spanish Steps or waterskiing may not be as delightful—or even feasible—at an advanced age, despite having money. What good is wealth if you lose the health or ability to enjoy it?

Changing this mindset involves rethinking the purpose of money. It’s not just for security but also for enabling fulfillment. The author, inspired by a coworker’s advice, decided to balance saving with living. He realized it’s foolish to hoard money in your youth only to hand it to your older, potentially wealthier self.

Examples

• John and Erin’s last precious months together
• A young traveler climbing Rome's Spanish Steps with ease versus an elderly counterpart
• The author’s shift from extreme saving to enjoying life in his twenties

2. Experiences yield lifelong “memory dividends”

Spending on experiences rather than things creates memories that continue to pay emotional dividends for life. This concept parallels financial investments, where a one-time expenditure can yield long-term returns. A trip to Europe, for instance, isn’t just about the joy of the moment but also the countless smiles and stories it brings over the years.

Every time you revisit pictures or share tales about your adventures, you earn these dividends. These memories add intangible wealth to your life. The author recounts how his father, in poor health, found great joy in a college football highlights reel. Even when new experiences weren’t possible, old memories brought happiness.

The younger you are when you make these investments, the higher the payout. Early trips or learning specific skills give you decades to relive and cherish those moments. This path ensures you accumulate a wealth of stories and emotional strength as you age.

Examples

• Recalling a fulfilling European trip through photos
• The joy the author's father found in a memory reel of his athletic achievements
• Long-term satisfaction from youthful adventures like skydiving or learning an instrument

3. Avoid working for free by dying with zero

Many people unwittingly “work for free” by saving excessively and leaving behind unused wealth. Consider Elizabeth, a woman who saved diligently for retirement but died with $130,000 unused in her account. This money reflected years of unpaid labor that could have been spent enjoying life.

The "Life-Cycle Hypothesis" suggests spreading wealth evenly throughout life, aiming for a net worth of zero at death. Predicting one's lifespan isn’t exact, but this method avoids over-saving at the cost of present happiness. Elizabeth could have retired earlier or spent her surplus wealth creating richer experiences.

By shifting your focus, you use money as a tool to enrich your life at every stage, not just as a cushion for old age. It’s about achieving balance—being financially secure yet not holding on so tightly that you miss the pleasures wealth can bring.

Examples

• Elizabeth’s years of unused savings equated to over 6,000 hours of labor
• The Life-Cycle Hypothesis guiding optimal wealth distribution
• Spending to create memories and avoid a stagnant financial legacy

4. Plan inheritance during your lifetime

Parents often save to leave an inheritance but rarely consider giving it during their lifetime. Research shows most inheritances come when children are around 60 years old—an age when additional wealth provides less value. Instead, transferring money earlier can help children improve their lives while still young enough to fully benefit.

Imagine a 30-year-old using inherited money to pay for a home, fund their children’s education, or travel the world. These payments create opportunities and experiences that serve as “memory dividends” throughout their lives. This also fosters a stronger parent-child relationship through shared happiness.

If the fear of health costs holds you back, long-term care insurance may be a more effective solution than saving for worst-case scenarios. This approach enables proactive wealth distribution while still ensuring financial security for emergencies.

Examples

• Average inheritance arriving too late at age 60
• A young adult using early inheritance to buy a home or go back to school
• The alternative of long-term care insurance to reduce financial hesitation

5. Change is constant, so seize the moment

Each phase of life comes with its unique joys and opportunities, but these are fleeting. The author uses the “time-bucket” method to divide life into segments. Each bucket represents opportunities that suit that period. For example, a younger bucket might include physical adventures like hiking Everest, while an older one could focus on intellectual pursuits.

When his daughter grew out of watching a movie with him, the author realized that version of himself, a father to a small child, was “gone.” These smaller deaths help us appreciate the transient nature of life and the importance of fully inhabiting each stage.

Time-bucketing ensures you make the most out of each stage instead of putting off opportunities indefinitely. It’s a reminder to act, spend, and live now for the milestones that fit your current life chapter.

Examples

• A father realizing his relationship with his young daughter has evolved
• Time-bucketing for physical challenges versus intellectual growth
• Experiencing hobbies and passions that are age-specific

6. Spend strategically in retirement

The fear of running out of money in retirement leads many to over-save. To determine the right amount, calculate your net worth and consider your expected lifespan and spending needs. Often, you need less wealth than you imagine due to compound interest.

Keeping your net worth slightly above your survival amount helps you avoid unnecessary sacrifices. By maintaining balance, you enjoy life without jeopardizing financial security. For instance, quitting a job slightly early might still be feasible based on accurate retirement projections.

Saving just enough instead of excessively allows you to live more fully without worrying unnecessarily about an overly distant future. This shift requires mindful assessments of your spending and savings habits.

Examples

• Calculating $480,000 as a retirement target for an expected lifespan
• Allowing compound interest to supplement retirement funds
• Quit working earlier by balancing resources wisely

7. Pursue bold dreams early

Taking risks is easier—and often more rewarding—when you’re young. Starting an acting career at 21, for example, offers time to recover from failure and the chance to pursue other multitudes of opportunities. At 35 or older, risks are harder to justify due to established responsibilities.

Young adulthood is the optimal time for “asymmetric risks” where potential rewards outweigh downsides. Delaying these risks could cause regret. Later success, while possible, leaves less time to enjoy the fruits of that effort.

Life offers a shrinking window for bold ambitions. The true gamble is in failing to chase your dreams when you're best positioned to do so.

Examples

• A 21-year-old aspiring to be an actor with minimal setbacks from failure
• Losing the chance to try risks when tied to family responsibilities
• Late success offering fewer years to enjoy rewards

Takeaways

1. Begin time-bucketing your life to pair experiences with the right age, ensuring no dream or passion is postponed indefinitely.
2. Assess and adjust your savings plan to balance financial growth and present enjoyment. Don’t let fear dictate unnecessary sacrifices.
3. Share wealth early with loved ones instead of waiting for inheritance. Let your money contribute meaningfully to your family’s life now.