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My Thoughts On Die With Zero (Book Review)

July 28, 2023


Until recently, I was perhaps the only person in the FI space who hadn’t read Die With Zero.

So, after 73 people had asked me my view on the book, I finally got around to reading it!

Granted, I still haven’t read Your Money Or Your Life… that’s on the list too 😅

Anyway, Die With Zero has become a widely read and highly recommended book in the personal finance community.  After reading it, I can see why.

This post will be a general overview of the book, and a collection of thoughts on which points stood out to me, what I liked and what I’m not sure about.

In reading the book, I’m actually surprised how many concepts overlap with what I’ve been saying on this blog in recent years, as I focus on getting people over the fearful hump of breaking the status quo and into a life with more freedom.

Let’s get into it!

 

What is Die With Zero?

Die With Zero is essentially about getting the most out of your money while you’re alive.  It suggests planning your life and finances around spending all your money before you die.

Now, this idea seems insane on the surface, especially for those of us who’ve been lifelong savers!  But the author, Bill Perkins, puts forward some unique concepts and ideas which makes it semi-convincing.  The idea isn’t just about spending all that money on yourself, but also passing it on to loved ones and making charitable donations, and considering the different stages of life.

In practice, it involves figuring out the amount of money needed for the rest of your life, deciding what experiences you want to have, how much they cost, and lining up the numbers to ensure that, according to life expectancy projections, you can expect to die with roughly zero dollars.

It’s easy to initially dismiss the idea as reckless or too risky, and it definitely could be in the wrong hands.  But let me flesh out how I interpret the book’s points before you decide.

 

Most wealthy people are afraid to spend on themselves.

As someone who’s now spoken to lots of wealthy people, I can confirm this is true.  Despite seeing expanding wealth and more passive income than they know what to do with, many folks are simply not comfortable spending extra money.

Even on small-ticket things, like extra coffees or restaurant meals.  You might recall I named this ‘relentless saver syndrome’ in a previous post trying to put this into perspective.

It’s quite bizarre really.  To have $1m more than you need, but still have uncomfortable feelings around spending an extra $5k per year on random nonsense.  Don’t misunderstand me, I’m all for principles, and certainly not one of these finance writers who shun frugality.  But these uncomfortable feelings often stem from an unhealthy fear.

Of course, most people in society don’t save enough.  So the point here, and the book itself, is more for those who are in a strong financial position (like this audience and the FI community in general).

The fear of running out of money for most people in this space is totally illogical.  You’re likely already in a great position, and you got there by knowing how to manage your money well.  You likely have backup plans and many levers you can pull if shit hits the fan.  So you should be operating with an abundance mindset and a healthy sense of perspective, not from a position of worry.

 

Lifetime earnings and enjoying the present

Consider your expected lifetime earnings and trajectory.  Will you earn a lot more in the future compared to now?

If yes, then saving may be less important.  Let me explain.  Imagine you’re on a low income, early in your career, with high future income prospects.  If you’re likely to earn significantly more in 5-10 years, relax and enjoy life (within reason).

Those small savings won’t make a big difference compared to your future cashflow.  Spending on experiences is likely to create cherished memories and a happier life in the grander scheme of things (much more so than possessions).

For example, Bill’s friend spent all his money on travel and experiences in his early twenties.  He now wouldn’t trade those memories for any amount of money.  Being older and having responsibilities means he couldn’t replicate that today even if he wanted to.

This can obviously be taken too far though, as people become used to spending everything they have, regardless of income level.  But for the mindful and sensible person, the message is to consider your spending in relation to lifetime earnings and income trajectory.

 

Memory dividends

Bill introduces the concept of memory dividends, which suggests that experiences provide enjoyment in the present and also continue to enrich our lives as we remember and share them.  Memories accumulate over time, creating a bank of cherished moments and stories.

This is probably the most popular concept in the book.  And while I agree with it in theory, I don’t think it’s as strong as it first seems.

If we’re totally honest, most of our past experiences, although enjoyable at the time, become foggy and blurry in our minds.  This doesn’t diminish the value of experiences, but it means we shouldn’t overestimate their long-term impact.

I’m reminded of something Mark Manson would likely say at this point.  Most of life – for everyone – is relatively unremarkable and average.  That’s not a bleak concept, it’s just reality.

Yes, we should aim to live joyful and fulfilling lives.  But think about how many ‘experiences’ you’ve had versus how many really stand out in your mind?  The ratio is probably mindblowingly small.

Grumpy old man side note:  This whole ‘experience’ fetish ends up manifesting itself, almost universally, in exotic holidays.  Not in volunteering, helping people, or spending hundreds of hours more with our loved ones.  And in this way, we succumb to another flavour of consumerism, enjoyed infrequently, as opposed to building greater meaning into our everyday lives.  So again, while I like the meaning and the message, I think it will be butchered and bastardised in its implementation.

 

Planning for a long retirement

I think the book’s target audience is wealthy middle-aged individuals preparing to live off their wealth.  Their goal is to enjoy life while ensuring financial security for the long term, including healthcare expenses.

While many people may only need money to last 20-30 years, the FIRE community often aims for 40-50 years of financial independence, requiring a less aggressive spending strategy.

That said, younger retirees have an ace up their sleeve: the ability to earn more income throughout our lives if needed, rather than depleting our portfolio.  Retiring early and spending down our wealth might not be wise, but hoarding money without purpose isn’t either.

The reality is, most of us are going to get wealthier after retiring, as we do new productive things with our energy, some of which will earn money.  But that’s when we can start giving more money away, spending more on family or travel or whatever we decide is important to us.

 

The point of wealth isn’t wealth itself

It’s foolish to blindly build wealth forever while neglecting to spend on things which add could add genuine value to your life.

For example, prying yourself out of the workforce to spend time with your kids.  Learning to play an instrument or learn a language.  Cashing out some retirement savings while you live overseas and explore for a year.

It’s about using your money to enjoy life, not using your life to accumulate money.  In this sense, the book’s message has a lot in common with the FIRE movement.

The point is to think carefully about how we spend our life.  Instead of optimising for money, Bill suggest to optimise for fulfillment.  That can equally include things that are completely free, or outrageously expensive.  But in either case, be deliberate and intentional rather than just accumulating money and then leaving a pile of assets when we die.

Until now, this philosophy can seem like an incredibly selfish one.  What about the kids or charity?

 

Give your money away earlier

Bill believes giving money away at death is suboptimal.

Instead, he suggests we plan to give to kids, charities, etc., during our lifetime. This way, we get to experience the joy of generosity while we’re still alive.

How do we to this?  Mentally or practically separate this money from your wealth.  Then give it away to your children or causes you want to support sooner.

There’s another interesting reason this approach is recommended.  Inheritances typically occur around age 60, when these folks are likely already financially stable.

If it’s your goal, giving money to your kids at a younger age, say 25-35 makes more sense.  Why?  These adults are (ideally) grown up enough at this point not to blow it, but still get the advantage of its use and compounding.

Charities also benefit from getting money sooner.  The money can’t do any good until they actually receive it.  Sooner they get it, the quicker they can make progress on whatever cause it is.

 

Life experience points

Another interesting concept is to think about our memories and experiences as if we’re accumulating points in life.

This can help us quantify the benefits of spending on things we value versus hoarding money.  I think this is a neat mental trick to help people spend more and avoid being overly conservative.

We may accumulate lots of unnecessary dollars but few ‘experience points’ throughout life, resulting in a less enjoyable journey than we could’ve had.

The book also argues that leftover money represents wasted life energy.  Dying with $1 million means we likely worked too long, and missed out on more time with family, friends, and hobbies, or spending on things which may have improved our lives and people or causes we care about.

 

You can adjust for your risk tolerance

I’m glad he covered this.  As I was reading all I could think was “Yeah, good luck trying to convince people to spend down all their money.”

Most of us in the FI space are somewhat cautious people.  We like saving because it shields us from the bullshit problems that come when we don’t have money.

As a group, we like risk in investing, but not risk in spending.  We like seeing the numbers go up, not down.  Many of us are conservative by nature.  Hell, you see people with 30x their annual expenses saved up and 2 other income streams, still worrying if they’ve got enough to retire, and multi-millionaires feeling guilty when they go out for lunch on a random Tuesday.

Risk tolerance is a wide spectrum.  Some people are comfortable with a spending/withdrawal rate on their portfolio of 5-6%.  Others are finger-biting even at 2-3%, if they ever amass the courage to retire at all!

By the way, I created a spreadsheet to keep a running estimate of my dividend income to help plan my finances.  If you’d like a copy for yourself, simply enter your email below and I’ll send it to you.

Importantly, Bill points out that if you approach your retirement spending and wealth planning from a position of fear or avoidance, you’re going to be working for many additional years as a slave to your own mind.

I couldn’t agree more.  In practice, he’s saying aim to die with as close to zero as you feel comfortable with.

 

Shift your spending

Younger people are encouraged to consider moving some of their spending forward.  One example is bringing forward certain travel experiences from 60s/70s to 40s/50s if possible.

Why?  Well,  you get more out of certain holidays when you’re in better physical condition.  A trip that may have included skiing, for example, you might want to do that earlier, and save those relaxing cruises until later in life.

This is a common sense way of approaching travel that people may not have thought about before, since it’s not nice to think about getting older and less fit!

 

Strike the right balance

There’s an important reminder that the three foundational pillars for enjoying life – money, free time, and health – are often hard to balance.

When we’re young we don’t have much money, but we have more time and health.  When we’re older, we have more money, but less health.  And in the middle, we have some money and some health but not much free time.

The illusive, magical trifecta is having all three.  Luckily for those of us pursuing financial independence, this is exactly what we’re aiming for.  Most of us will reach those middle years of our life with far more money and free time than our peers.  So as long as we maintain our health, life will be very sweet indeed.

Regardless of age, life quality is dictated largely by our health.  So this area is worth investing time and money into, because it has such a great long term payoff.

 

Peak net worth

After running countless simulations, Bill suggests that most people’s peak net worth date for the optimum enjoyment of money is between 45-60 years of age.

At this point we should be comfortable letting our wealth stop expanding and slowly start eating into it.

This concept will feel wildly uncomfortable for almost everyone reading this, since we’ve been working so hard on growing wealth for many years.  But if the goal is to maximise the usefulness of money before we die, a ‘peak net worth’ date is inevitable.

If you wait too long, it’s unlikely you end up at zero, so you probably spent too many years at work.  Not gonna lie… I’m not sure how I feel about this one.   I love the idea of giving money away over my life, but I don’t like the idea of the numbers not going up anymore 😅

Maybe when I’m older and richer I won’t see it the same?

 

For those who love working…

The book calls for these folks to spend more aggressively.  Because after you’ve built some wealth and there’s still more coming in, it becomes surplus.

For us in the FI space, this would mean maximising the enjoyment of any cash above our FI number.  So after retirement, if we make additional money somehow, that can be seen as bonus money for us to do whatever we like with.

I’m on board with this concept and have mentioned similar things in the past.  We’ve actually being doing this in little ways like going out for coffee and food a lot more recently, and in future years we’ll spend more on travel and charity.

In reality, no matter how wealthy, Aussies can blow basically all their money by their mid 60s and get the pension anyway.  A government guaranteed, inflation protected income stream, with an equivalent value of $1m for a couple and $600k for a single (based on 25x income).

Of course, this bring in an ethical argument, which we don’t have space to explore in this article.

 

My observations and takeaways

Some random thoughts I wrote down as I read the book…

—  Having wealth provides its own sense of wellbeing and peace of mind, even if it’s stagnant and not being used.  I feel this was overlooked.

—  Declining wealth is a huge psychological barrier to overcome, I don’t see many people getting past this.

—  This book could easily be taken too literally as promoting a ‘live for today’ hyper-consumer approach to life.  In reality, it’s meant for people with a lot of money who need to just let go and enjoy life more.

—  It’s a message of intentionality.  All through the book, it was hammered home that we need to think and be deliberate about our lives vs the standard mindless path.

—  If we have money, it does make sense to spend it on meaningful activities, things we care about, and those around us, so we can look back and be pleased with the life we lived.

—  The biggest way we can use our wealth to improve our lives is taking more TIME for ourselves.  I’m not sure this was emphasised enough, as the focus was more on optimising for spending money.

—  This book complements the FIRE movement and can take some of the edge off extreme savers who can’t bring themselves to spend much on anything and therefore miss the big picture.

—  A cynic might suggest Bill is a mysterious agent sent to prop up the consumerism hamster wheel, encouraging us to spend every dollar we have.  While that’s an unfair assertion, you’d be forgiven if that thought did pop into your mind at some point 😁

 

Final thoughts

Would I recommend this book?  Yes.  While I don’t agree with everything in it, I do think it’s worth reading for anyone with some wealth.

Most people are worried about running out of money in retirement.  But seemingly nobody is worried about running out of time to enjoy that money, and life in general.

The money is replaceable.  Time is not.  This is a powerful and important concept that’s worth thinking deeply about.

Regardless of whether you nail this framework perfectly and end up with zero dollars, you’re going to end up with zero time.  So think about how to use it for the best life you can build.

This means thinking hard about what will make you a happy old man/woman, knowing that you didn’t fluff around and waste your best years in some shit job, or operate your finances in a state of fear, never really enjoying yourself because you were always worried about having ‘enough’.


Thanks for reading! 

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My book: After 5 years and hundreds of articles and podcasts, I’ve now distilled everything down into an easy to follow book.  Designed as a complete roadmap to achieving financial independence and retiring early in Australia.  Available in paperback, ebook, and audio.

Mortgage broker: My personal broker of 10 years is More Than Mortgages.  If you’d like help refinancing or getting the right loan for your needs, get in touch with MTM. They have fantastic reviews for a reason. I’ve worked with them for 10 years and they’ve been excellent.

Sharesight: A great portfolio tracking tool for share investors, and free for up to 10 holdings.  It tracks all dividends, franking credits and capital gains, which is incredibly helpful at tax time.  Saves me a lot of time and headache!

Just so you know, if you choose to use these resources, this blog may receive a financial benefit at no extra cost to you.  Thanks in advance if you do.  And to be clear, I only ever recommend things I use myself and genuinely believe in.

26 Comments

26 Replies to “My Thoughts On Die With Zero (Book Review)”

  1. I did enjoy the book in some respects as we don’t want to go through life merely sitting at home counting our pennies and not having any fun or life experiences, The thing that I couldn’t swallow was the book is written by someone with a lot of money, enough money you can almost never spend. For the average Joe who has to work really hard to save I find it a little hard to swallow. If it was written by someone who is an average wage earner I might accept it a little more.

    1. Totally agree with you Gary. The different position of Bill vs a less wealthy person is a good point. I do think there’s some solid points in there that aren’t discussed much that we should keep in mind.

  2. Not sure if 72 people have recommended it to you yet, but for me whilst I devoured die with zero, Taking Stock by DocG resonated more with me.

    Taking Stock: A Hospice Doctor’s Advice on Financial Independence, Building Wealth, and Living a Regret-Free Life
    Book by Jordan Grumet

  3. Great review and perspective Dave. I agree with many of your thoughts however I disagree with your comments on memory dividends. I think that having many varied experiences and meeting different people early on in life contributes to your growth as a person. It helps shape who you become and influences the choices you make at different stages of life. That was my take away from the chapter on memory dividends.

    1. Thanks Lisa. Ahh ok we may have read that chapter differently then. I think where I disagree is the idea that the ‘memories’ themselves are the important parts. Our memories are usually terribly hazy and fade quickly, so I didn’t really buy the whole ‘memories compounding’ thing. Whereas I totally agree with engaging in experiences that can help you grow as a person and which you’ll be glad you did looking back later… despite the fact that your memory of them will be poor. It’s possible I just took it the wrong way if more people see it the way you did.

  4. Hi Dave, great review. The best reviews bring critical thinking and add to the conversation.

    I agree on the concerns of memory dividends. Bill himself is case in point in promoting a memory dividend on a outrageously expensive birthday holiday with his buddies.

    What I think is interesting about this book is how many people agree, nod their heads, claim its fantastic and smart and do nothing about it. Or cherry pick ideas but ignore the dieing with zero bit but nod their head re. experiences.

    My favorite bit of the book is a survival threshold, where he gives an alternative formula to the 4% rule:

    “Multiply your annual expenses by how many more years you expect to live, then multiply by 0.7. Perkins calls this number a “survival threshold,” or the minimum needed to retire comfortably. ”

    Its a concept I would like to see more detailed (i.e. does it include your house and what if you have high expenses now due to family). But is missing in the book and everywhere generally.

    Definitely like to your thoughts on that, Dave?

    1. Cheers Bludger!

      Haha, that’s a good point. What you describe – people doing nothing after reading it – is probably the same for most books! I dare say 99% of people reading this book will just end up going on more holidays and not doing much else different 😉

      I like the ‘minimum’ threshold idea too (if we’re talking about the same bit). I’m not sure on the total maths of it to be honest, it’s probably one of those tricky variable calculations like most of these retirement ones are. I’ve mentioned this sort of idea in the past by suggesting people ‘retire on the basics’ using a chosen withdrawal rate to get free sooner, then use part-time income to spend on extras they might want to enjoy. This, to me, is the simplest way of approaching it at a basic level, as any calculation to attempt accuracy is likely to be wrong given the unknowables.

  5. I guess many people remember life experiences differently. I’m fortunate that I seek to travel mainly for free in the early part of my career.

    Yes, I agree that this book is mainly written for people with a lot of money and more specifically the likes of Gina Rinehart! 🙂 Imagine having so much money and yet still greedy for what is clearly someone elses!

    Also I will agree that it’s pointless growing your wealth at accelerated rate once you’ve reached FI, so I will be monitoring income coming in and will plan other ways to spend the money if there are excess for certain years.

    1. Thanks for your thoughts Ronald. Sounds like a good plan, and nice work on getting the free travel earlier on via work!

  6. Hi Dave – I am curious what you thought about the idea of using some money to buy an annuity? I know they aren’t popular with investors. But they do take away the worry of running out of money especially if you do a deferred annuity and just have it for when you are in your eighties. What do you think? I loved your book and your blog. Thanks!

    1. I haven’t looked into it enough to make a proper judgement on it. But the idea is that it guarantees you always have an income stream for life. Worth remembering that in Australia we already have a decent income stream as a backup called the pension. Sure, it’s not huge, but as an inflation linked backup income it’s pretty good, especially for wealthy people who probably also have a paid off house (very likely for readers of the book).

  7. I listened to Aussie Firebug’s interview with Bill Perkins (the author of this book) last year while my son was looking to buy somewhere to live. He’s lucky! I ended up giving him 15K, which secured his mortgage.

    I thought that his point about giving money to your kids when they were young adults when they really need it made a lot of sense. It was happening before my eyes, after all!

    Since then I’ve helped another son with wedding expenses and another with money needed to attend Clown College in France. But being your typical cautious FIRE person, I’ve chosen to go back to work as a relief teacher to pay for those things.

    I agree with his concept of memory dividends and for me – that is definitely travel, An overseas trip every year is my aim. Memories from those trips flit across my mind every day in some way and bring me happiness. Money well spent!

  8. I agree with your overall assessment. There are obvious problems with the book, aside from the fact it really could have been 20 pages and the writing was meh. IMO, if you’re going to get a ghost writer, at least get a good one.

    BUT it’s a worthwhile concept and something everyone should think about.

    I don’t want to leave my kids with a bunch of money. I would much rather spend it on them and us now and in the future. So it did give me a lot to chew on in that regard.

    1. Thanks for your thoughts AR. Definitely some unique concepts in there I reckon… didn’t realise he didn’t write it himself?

  9. Hi Dave, I read the book and for me the big unknown at the end of life is medical expenses. My parents are in their mid-late 70’s and have had an increasing number of medical conditions as they age. Dad may be facing a dementia diagnosis and the thought that mum needs to live in the house whilst dad goes into care, for what can be an extended period and very expensive makes me too nervous to think about trying to die with $0. If I manage to retire early I would hate to be in a position of having spent it all only to need it to live in a reasonable health facility in my final years.

    1. Completely agree Cindy. Both my parents feared having to go into aged care and both of them were fortunate enough to have avoided it entirely. It’s also a huge concern for me and spending money on institutional aged care alternatives that allow me to stay in my own home will be a massive priority. Worst case scenario where I eventually need to go somewhere, it won’t be great but I’m pretty sure the more financial resources I have to call on the better.

      TBH I have no desire to read the book based just on the title and the obvious concepts that no one knows how long they will live and how their need for funds will change over that time. From Dave’s review it might not be as bad as I thought but I still doubt I’d get enough from it to justify the investment (by “investment” I mean the time to read rather than the cost of the book).

      1. Oh sorry if I missed this to you and Cindy, but he does cover this topic of late stage medical treatment and care in the book. I believe his recommendation was to plan for this in your expenses and section it off as ‘non spendable’ essentially, and combine that with insurances. He does go into quite a bit of detail that most people don’t actually end up spending very much on healthcare and oversave for it. He also seems to be against the idea of extending life for the sake of it, especially where quality of life is massively diminished later on. So it’s a bit more thoughtful than it might seem at first, especially from the title etc.

        So the idea is to actually map it out as best you can, rather than the common approach of “I don’t know how much it’ll be so I better not spend any of my wealth just in case”

  10. Hi Dave,
    Thanks for your time and input. I enjoyed your review.

    Dave I am 68. Computers are not my strong point. I don’t mind losing money I the stock exchange. I loath the idea of losing it to scammers.

    Please Dave give us some advice how to protect ourselves from scammers.

    I rather give it to charity than scammers.

    I throughly enjoy your emails.

    1. Hey Neil, thanks for reading 🙂

      Well, here’s what I do to avoid scammers as best I can…

      – Never answer the phone unless I know who it is (they’ll leave a message if important).
      – Never click on a link inside a text msg unless I know 100% what it is (even if it’s supposedly from a company I trust).
      – Never click on a link inside an email unless I trust the sender by checking the ‘from’ address. Quite often scammers have email addresses which don’t quite look right, especially if they’re trying to pretend they’re from a bank or some other trusted company.
      – Never give out your personal information (birthday, postcode, full name, etc) unless absolutely necessary + ideally you can verify the request is from a legitimate company
      – Assume anything on social media is a scam (a sale, an investment opportunity, etc) unless you know the person or can verify it’s accurate by researching it separately without clicking on it (even by clicking you’ll be targeted for more of the same in the future).
      – Ignore most electronic correspondence related to banking, ATO, investing, utilities, deliveries, where they want you to take action (reading it is fine). Even if the ATO needs to contact you, they will do so by written letter or by a proper phone call. Things that are super important will usually warrant an official document of some sort.
      – Continue being skeptical and on the lookout as it sounds like you probably are already, which is better than being too relaxed about it.

      None of this is perfect, and there are exceptions, but some of these things may be useful.

  11. Having developed a savings habit over your life, why would you then go and drawdown your capital to live off. That is effectively what our super system is and I don’t like it. If you invest your savings in income producing assets, you have an income stream which funds your lifestyle and keeps the capital intact.. Even the age pension is an income stream not a capital drawdown strategy. if you subscribe to the die with zero ideal, don’t buy a goose that lays golden eggs.

    1. His answer to that would be: you are either not enjoying that money to the fullest, or you worked longer than you needed to, or other people could use that money to do more important things with (kids, charity, etc).

      So it’s a balance between living for today and saving nothing (most people) and acting like you’ll like forever (cautious oversavers). Not one or the other. It can take some time with the idea to get comfortable with it, but I do think it has some merit. And obviously you don’t have to die with zero, but being willing to enjoy freedom earlier with less wealth and/or use more of that wealth for important things while alive is worth considering, rather than a strict ‘don’t spent the principal’ framework.

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