Die with zero

How much money is “enough”? Are you working toward a specific number in order to retire? Perhaps you think you’ll know when the right time comes? Or maybe you’re so busy with your office, patients, mortgage, and student debt that you haven’t had time to consider it. And if someone asked you what your savings were for, how would you respond? To enjoy retirement? Invest? Donate?

In his book Die with Zero: Getting All You Can from Your Money and Your Life, Bill Perkins suggests that we should all aim to die with as little money in the bank as possible. I read the book last year, and it had an enduring influence on how I think about building my “wealth.” The premise of the book (as I adopted it) is that we need to redefine wealth. Wealth is not the same as net worth. Net worth refers to your assets minus liabilities, whereas wealth should encompass a more holistic view of how you spend your life’s resources. I should clarify that this book was not written for millionaires; its philosophy is meant for anyone who is working and has savings.

The author, an electrical engineer turned hedge-fund manager, proposes a strategy to avoid “over-saving and under-living.” He explains that most of us are saving now in order to give the money to our older, richer selves. Considered in this way, saving is a form of delayed gratification. We invest money to earn dividends so that we will have more money to spend on positive experiences later in life. However, as the book describes, there is a fundamental problem with this approach—wealth is nothing without health. Some experiences either cannot be enjoyed or would be less enjoyable when we are older. Early in his finance career, the author turned down an opportunity to backpack through Europe with a buddy because the $10 000 loan and high interest rate seemed irrational. Looking back on it as a financially secure 30-year-old, he realized that he had lost the opportunity to broaden his horizons with hostels, sightseeing, parties, and new friends, because that no longer appealed to him in his current stage of life. He was troubled by the fact that when he finally decided he could “afford” the trip, it no longer had the same value. This resonated with me. Is anyone else hoping to trek in El Salvador, learn to play tennis, or build a cabin during retirement?

To me, the most metamorphic concept in Die with Zero was “experience dividends.” In this nontraditional view of wealth, the author posits that experiences are investments, rather than expenses. For example, imagine you are a 50-year-old physician who invested in a family trip to Disneyland when your children were young. The initial experience created a surge of joy, but so does each recollection of the trip. Your memory pays you dividends in the form of smaller surges of joy each time you recall the kids happily screaming on the teacup ride or holding a melted ice cream while asleep in the stroller. If you envision the initial experience as the highest bar on a chart and each subsequent memory comprising a tail of smaller bars, the memory dividends may, summated over a lifetime, even surpass the value of the original experience. My goal is to be experientially wealthy.

Dying with zero does not mean spending your kids’ inheritance or wasting money on frivolous pursuits. The book simply encourages you to make donations and gifts when you can, rather than waiting until death. Charities can make a bigger impact if you give them your money today, instead of at some undetermined time in the future. They, too, are investing for experience dividends.

Time is a nonrenewable resource. However, many of us are too busy working to thoughtfully consider how to use the money we accumulate while we are spending our time. Die with Zero proposes that we think of the phases of our life as buckets, make a wish list of experiences, and then figure out which bucket each experience should fall within. Invest in creating memories today that will make you happier in the future. I think Drake said it best: YOLO.
—Caitlin Dunne, MD, FRCSC

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