Die with Zero?

By Bob Lai

Special to the Findependence Hub

Recently I met up with a good friend for a much-needed chat. Over the course of a few tasty cans of beer, my friend mentioned that he recently listened to the “Die with Zero” audiobook and really enjoyed the key messages of the book.

Curious, I borrowed the book from the local library and finished reading it in two days.

The book’s author, Bill Perkins, suggested that we should all aim to die with zero dollars in our bank account, or at least as close to zero as possible. He argued that too many people spend unnecessary energy working extra years only to earn money that they wouldn’t be able to spend in later years and die with a large sum of money in their bank accounts. This is definitely different from the traditional belief of saving money during your working career and spending your savings once you’re retired.

Why die with $200k in your bank account, considering it took you an extra five years to save it, when you could have stopped working five years earlier?

Perkins believes that our lives are the sum of our life experiences which can be quantified and optimized. Therefore, we should focus on spending our money when we are younger and obtain as many life experiences and memories as we possibly can.

My friend now believes in spending his money in the most optimal way to obtain memorable experiences for himself and his family while keeping a focus on saving for retirement in the best approach. This is similar to what I’ve been preaching on this blog – find your own personal balance between spending money to enjoy the present moment and saving money for your retirement.

The fallacy of “save-save-save” mentality 

For many of us on the financial independence retirement early (FIRE) journey, we think about saving money constantly. We think about what’s the best way to save money and how to boost our savings rate, so we can become financially independent earlier.

But the “save-save–save” mentality isn’t actually healthy. It’s actually giving the FIRE movement a very bad vibe.

I’ll be honest, I was certainly guilty of focusing purely on our savings rate early on our FIRE journey. I wanted to cross the finish line and hit the escape button. Over time, however, I found that I wasn’t enjoying the small things in life. I felt frustrated when we spent money eating out or having a cup of coffee and treats at a cafe; I was having arguments with Mrs. T over these small expenses, because I wanted to save more money to expedite our FIRE journey.

When I stepped back and looked at the bigger picture, I realized that the “save-save-save” mentality wasn’t healthy. It was actually quite detrimental, especially to my relationship with Mrs. T.

I knew I had to change.

So over time, I changed my view – saving is important, but it’s about finding the right personal balance between spending money to enjoy the present moment and saving money for the future.

What about the kids? 

At first, the idea of dying with zero bugged me when it came to passing down our legacy. We’ve always wanted to pass down our dividend portfolio to our kids and possibly grandkids so they can be ahead financially. Doesn’t “the die with zero” idea mean we are being selfish and not thinking about our kids at all?

I was glad that Perkins discussed this idea in great detail throughout the book. Basically, he suggested that we should allocate money to kids and give money to them much earlier to provide the biggest impact, rather than giving inheritances. The argument was essentially that we should ‘gift’ money earlier (and there is no gift tax in Canada) earlier when our kids can arguably make greater use of these financial gifts, rather than waiting later in their lives – when we die – when they probably do not need the money as much. Specifically, it might make greater sense to give our children money for a down payment for their first house in that very expensive market, rather than holding on many years and only passing on that money when we ourselves pass on.

For example, giving your kids $100,000 when they are in their sixties doesn’t have as much impact as giving them each $100,000 when they are starting a family.

The same concept applies to giving to charities.

So why wait to give your money away after you’re dead when you can provide a bigger impact and create a legacy by giving money away earlier while you’re still alive?

Arguably more importantly, you get to see the positive impacts of the ways in which your money is improving people’s lives.

To me, that makes a lot of sense and I can certainly appreciate what my parents have done for me – paying for my post-secondary education, taking us on trips, giving us money for our honeymoon, giving gift money to our kids, etc.

The more I think about it, the idea of allocating money to give to our kids and charities during our lifetime is more attractive than leaving the money in our wills. I will need to discuss more implementation details with Mrs. T as we get closer to our FIRE target. I also need to get her to read “Die with Zero.”

Time-bucket your life

My biggest takeaway from reading “Die with Zero” was the idea of starting to ‘time-bucket’ your life.

What are ‘time-buckets?’ Well, ‘time-buckets’ are a simple tool for discovering what you want your life to look like in broad strokes. You can do that by creating a timeline of your life and dividing it into a series of set time intervals, such as five or ten years. Then in each time interval, you write down ideas and experiences that you’d like to do. For example, run a marathon, build a house, volunteer at a local charity, go to Italy, visit Yellowstone, take your kids to Disneyland, etc.

The ‘time-bucket’ idea got me thinking…as I turn 40 later this year, reaching a major milestone, what do I want to do in the next five, ten, fifteen years and beyond?

Here are some things I would love to experience:

• See the Great Pyramid of Giza
• Take my kids to Disneyland
• Ski in Hokkaido
• Go to Machu Picchu
• See the Terracotta Warriors
• Take my kids to the British Museum
• See ‘The‘Last Supper’ in person
• Live in Denmark
• Live in Taiwan
• Go to Australia and New Zealand
• Attend my kids’ high school graduation
• Attend my kids’ university graduation
• Attend my kids’ weddings
• Go to Antarctica
• Write a cheque for $1 million to a charity
• Volunteer at a local charity

When I look at the list, I realize many of them are travel-related and I want to do them while I’m still young, instead of waiting until I’m in my 70s.

If I break down these experiences in time intervals of 5 years, it’d probably look something like…

40-45 years old

• Take my kids to Disneyland
• Ski in Hokkaido
• Take my kids to the British Museum
• Live in Denmark
• See ‘The Last Supper’ in person
• Go to Australia and New Zealand

45-50 years old

• Live in Taiwan
• Attend my kids’ high school graduation
• Go to Antarctica
• Go to Machu Picchu

50-55 years old

• Attend my kids’ university graduation
• See the Great Pyramid of Giza
• Volunteer at a local charity

55+

• Volunteer at a local charity
• Write a cheque for $1 million to a charity
• And many more adventures

As I compiled my ‘time-bucket’ list, the more I began to ask myself… why wait? At six and eight years of age, my kids are at the perfect stage to enjoy the magic of Disneyland. Do I really want to wait another five or so years to take them to Disneyland for the first time? The Disneyland experience will certainly be very different with younger kids versus teenagers.

I also realized the power of spending money now to enjoy life and to gain life experiences. Skiing in Hokkaido when I’m more than 55 years old certainly wouldn’t be as enjoyable as skiing in Hokkaido when I’m in my early 40s.

With that in mind, I can’t help but feel excited about the potential experiences and memories I will be able to gain in the next five, ten, fifteen years and beyond.

Final thoughts 

The more I think about it, the more I have to agree with Bill Perkins and his idea of ‘die with zero.’ Since no one can accurately predict when their time on Earth will come to an end, I think my personal approach can be summarized as follow:

It is important to save money for the future but do focus on spending money to gain life experiences and ever-lasting memories. Give money away to people and charities at times that would make the biggest impact. Most importantly, enjoy your life while you can and not think about all the regrets you have when you’re on your deathbed. 

Dear readers, what do you think about the die with zero idea?

This blog originally appeared on the Tawcan site on April, 2022 and is republished on the Hub with the permission of Bob Lai. Hi there, I’m Bob from Vancouver Canada. My wife & I started dividend investing in 2011 with the dream of living off dividends in our 40’s. Today our portfolio generates over $2,700 in dividends per month.