PDF Summary:Die With Zero, by Bill Perkins

According to hedge-fund manager and energy trader Bill Perkins, your goal should be to die with zero dollars in your bank account because you’ve used all your money to lead the fullest possible life. Perkins explains that people generally tend to over-save and under-experience, but at the end of our lives, we’ll actually value experiences more than the money we saved. In Die With Zero, he proposes a strategy for maximizing enriching experiences throughout your life and minimizing unspent funds.

Perkins gears his book toward an audience with disposable income whose earnings will likely continue to grow over time. He acknowledges that his advice isn't a substitute for a professional financial planner, and he focuses on big-picture spending and saving principles rather than specific financial advice. We’ll supplement Perkins’s recommendations with other financial advice and alternative views on how to make the most of your wealth.

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How to Spend All Your Money by the Time You Die

Now that we’ve explored Perkins’s argument for why you should spend all of your money by the time you die, we’ll look at his advice on how to do so strategically and responsibly. We’ll break his recommendations into three sections, all of which revolve around proper timing: spend while you’re young, plan your long-term spending trajectory, and spend on the ‘right’ things at the right time.

Spend While You’re Young

Perkins writes that one good way to die with zero is to spend more money when you’re young. If you don’t invest in experiences while you’re young, you risk missing out on many of the best moments in your life. For Perkins, forgoing experiences when you’re young just to save money is illogical. You might not get the chance to have those experiences again, and they won’t be the same when you’re older. For instance, your 25-year-old self might be thrilled to go skydiving, while your 65-year-old self might not be.

(Shortform note: It’s true that some experiences are best enjoyed—and purchased—at a young age: Studies show that our bodies begin to decline in strength, endurance, and balance in our 50s. If you wait until then to have experiences that rely on physical health, you might not be able to have them or enjoy them as much as you might have as a younger person.)

However, you’re almost certain to be financially richer later in life, and financial costs that might seem daunting when you’re young will at that point likely seem inconsequential compared to the value of an experience. For example, say you’ve always dreamed of opening a toy store. It might make sense to spend nearly all your money or even borrow money to make it happen while you’re young. If the business fails, you’ll likely make the money back throughout your career, and you’ll be able to say you gave your dreams a chance. If you wait until later in life, your financial risk tolerance or ability to take a financial hit might be too low, or you might not be willing to risk failure.

(Shortform note: Some people don’t have to wait until retirement or old age to become rich: Studies show that the average age of first-time millionaires is only 37. People who work at the cutting edge of technology or have a degree in engineering stand a better chance of becoming millionaires than people in other fields. Such lucky individuals might be able to have rich life experiences at any age because they have so much wealth that whatever they do incurs little financial risk. However, to succeed as a tech entrepreneur, you probably have to work far more than most people (perhaps even up to 120 hours a week, if you have aspirations to become like Elon Musk), which would eat into your time to have experiences.)

The other reason you should start spending young is that if you wait until you’re deep into retirement, you’ll likely run out of time to spend all your money in a meaningful way. Perkins explains that many, if not most, Americans increase their net worth up to and sometimes through their retirement years. At this point, your physical abilities and desire to spend money on many experiences are likely lower than in previous decades. Therefore, you may die with a balance in your bank account. For example, by age 80, you might prefer to stay home and read a good book than to take a road trip to a National Park, so the money you could have spent on the trip will sit in your bank account.

(Shortform note: Some disagree with Perkins’s assertion that if you hang on to your money into retirement—and possibly until you die—you’ll lose the chance to spend it meaningfully, arguing that leaving a legacy to charity when you pass away is a very meaningful way to spend your money. In your will, you can leave a charitable bequest to an organization of your choice, where the money may well do more good for others than it would if you simply spent it on yourself. Still, a middle approach might be best so that you don’t forgo all enjoyable experiences: You might spend on yourself and also set aside an amount to donate to charity when you pass.)

Plan Your Long-Term Spending Trajectory

Another way Perkins advises you to spend all your money before you die is to plan how and when you’ll spend and save over the long term. While Perkins advises you to not forgo valuable experiences in your youth, he doesn’t advise you to spend recklessly throughout your entire life. Instead, you should spend the first part of your life saving more than you spend and the second part of your life spending more than you save.

The best way to precisely plan your saving and spending trajectory would be to know exactly when you’re going to die and then plan backward so that you’ll have spent all your money by then. Since this isn’t possible, Perkins suggests making an educated guess about when you’ll die and then planning your spending and savings based on your results. He suggests using the Actuaries Longevity Illustrator or the Life Expectancy Calculator to estimate how long you can expect to live and how long your money will need to last.

Once you have a rough idea of when you’ll likely die, you can determine when it’s ‘safe’ to start spending more than you’re saving. For instance, you’ll want to start spending more earlier if you think you’ll live to 70 than if you expect to live to 95.

(Shortform note: Creating a spending trajectory may seem like a sensible idea in theory, but implementing it might be more complicated. For one thing, there are unforeseeable circumstances—like global pandemics—that can throw a wrench into spending plans. The pandemic not only brought global tourism to a virtual standstill, but it also led to significant job losses. So if you were planning on spending money on travel or accumulating wealth during the pandemic, you may well have found yourself needing to rechart your spending trajectory. And on a more somber note, the pandemic led to a massive loss of life, particularly in the aging population, which may have rendered some peoples’ life expectancy calculations moot.)

Since we all have different patterns of saving and spending, life expectancies, health challenges, and desired experiences, the precise time to start spending more than you save will be different for each person. So, too, is the amount of money each of us would need to meet our basic expenses and maintain our standard of living should we stop bringing in additional funds. Therefore, Perkins devised the Spend Curve App, which can be found on the book’s website. This app personalizes his advice to help you figure out how to balance your saving and spending throughout your adult life.

(Shortform note: Another consideration to take into account when determining at what point to spend more than you save is your possible desire to downsize in retirement. Many retirees choose to move to a smaller home to eliminate the hassle and expense of keeping up a large house. However, downsizing can sometimes cost a lot up front: Some homeowners must invest in costly renovations to make their houses marketable while others might have to rent while they search for their next home. If you’re thinking of downsizing, research what you might have to spend up front and use that figure in the Spend Curve app or your own calculations.)

While everyone’s spending trajectory will be different, Perkins adds that for most people, it makes sense to build your net worth up to the age of 45 to 60. By this age, you may have reached your highest-yet earnings at work, saved for retirement, acquired assets, and, especially by age 60, you won’t be too far from being able to collect social security and Medicare (if you live in the United States).

(Shortform note: People who are currently under 55 may indeed reach their highest earnings at work and save for retirement in the age frame Perkins mentions, but it may be the case that those people won’t enjoy the same social security benefits that current middle-aged people do. J.L. Collins argues that by the time the large Baby Boomer generation has fully retired, there won’t be enough money to fund social security in the same way for subsequent generations. This means benefits will be smaller and will cost you more.)

Additionally, any money you’ve invested up to this point will continue to earn interest and further contribute to your funds as you age. At this point, Perkins suggests you start saving less and spending more to get the most meaning from your earnings before you die.

Perkins acknowledges that building your net worth up to age 45 may require making some spending sacrifices, and therefore, you may not get to have all the experiences you’d like during this period. His message is that you shouldn’t wait to invest in rich experiences that add meaning to your life, not that you should spend like there’s no tomorrow; balance is key.

(Shortform note: Perkins’s views on spending and saving stand in direct contrast to the—perhaps more common—view that the more money you have, the better off you are. People who believe this would likely continue saving past the age of 45, thereby sacrificing many fulfilling life experiences. But what makes such people value money so highly? Some believe that workers who receive performance bonuses develop an unhealthy obsession with accumulating money. Not knowing what the performance bonus will be or how it stacks up against colleagues’ bonuses leads people to think about them a lot, which in turn feeds into an unhealthy and unbalanced relationship with money.)

Spend Money on the Right Things at the Right Time

The idea that you can’t possibly fit all the life experiences you’d like to have into retirement is central to Perkins’s argument. Your physical abilities, risk tolerance, and energy levels tend to decline as you age, making certain experiences time-sensitive. Therefore, you should do the things that interest you—and spend money on them—when you’re most physically able to.

For example, say you’ve always dreamed of becoming an accomplished outdoor rock climber. Chances are you’ll perform better and enjoy yourself more if you take up rock climbing earlier in life. You’re likely to be physically stronger, better able to recover from injuries, and more accepting of the inevitable discomfort that comes with the sport before you reach an advanced age. Therefore, it makes little sense to wait until retirement to invest your time and money in the sport.

(Shortform note: Perkins writes that you won’t be able to derive the most enjoyment from certain activities at retirement age, and this idea could form the foundation for a case for the four-day workweek. Four-day workweeks, which are increasingly being tested and implemented, give employees more time to enjoy meaningful non-work activities during their career years rather than waiting until retirement. Four-day workweeks also lead to greater productivity, employee morale, and improved workplace culture, making them a win-win for both employees and employers.)

The time-sensitive nature of many experiences is why Perkins urges you not to fall into a pattern of saving every cent and thinking you’ll get to enjoy your money when you retire. To combat this tendency, Perkins suggests writing down the experiences you want to have and the corresponding time in your life when it makes the most sense to have them. For example, you probably should take up skydiving in your 30s or 40s rather than waiting until 70, but you can play chess through retirement.

Along with the book, Perkins has developed an app called the Time Buckets Toolkit App, which can be accessed on the book’s website. This app helps you organize your desired experiences into “buckets,” or time periods, so you can time when you should invest in them.

(Shortform note: What if you’re not sure of the experiences you still want to have in your lifetime? If that’s the case for you, perhaps you don’t yet have a strong sense of purpose. In The Monk Who Sold His Ferrari, Robin Sharma argues that a purpose serves as a guiding light, directing you toward certain experiences and away from others. When you know what your purpose is—whether it be to raise a happy family or write an award-winning book—it will be much easier to pinpoint what experiences you want to have and when it’s best to have them.)

Just as your ability to get the most out of specific experiences can decrease with age, so can the richness of the experiences you share with friends and family. Therefore, Perkins suggests using your money to create experiences for and with others at the right time, as well. For example, while kids can certainly enjoy a trip to Disney at any age, parents might choose to take them to the park when they’re younger to maximize the “magic” of the experience.

To give you the motivational push you might need to commit to the experiences you want to have, Perkins writes that there will be a “last chance” for everything in life. Your real last chance is, of course, the day you die, but there will be plenty of “last chances” along the way. For example, there will be a last time to take growing kids trick-or-treating, a last time your knees can handle a mountain summit, a last time you feel like sitting on an airplane for 14 hours to see a new continent, and so on. Therefore, you must not let “last chances” pass you by.

A More Constructive Way to View Time

The notion of a “last chance” is a product of a linear view of time. In this linear view, time is seen as moving inexorably forward and having a beginning and an end. A linear view of time is, of course, the most common and reflective of our actual life experience—we can’t go back in time, for instance. However, this view also can lead to unconstructive regrets, perhaps around not sharing experiences with loved ones at the right time, as Perkins counsels you to do.

Therefore, it might be healthier to view time as a spiral: Time continues to move forward, but the same opportunities and challenges re-arise cyclically. This gives you the chance to meet those challenges and opportunities differently. So, for instance, you might regret not sharing more meaningful experiences with your daughter when she was growing up. By viewing time as a spiral, you can recognize a new opportunity to engage with your progeny by having more experiences with your grandchild. While it’s still wise to consider “last chances” for certain activities, once you’ve missed a last chance, it might be healthier to think that the opportunity for that activity will eventually “spiral back” to you.

Consider Your Risk Tolerance and Take Precautions

Your financial risk tolerance will likely shape your response to Perkins’s recommendations on how to spend all your money before you die. Readers with a low risk tolerance might find some of his advice difficult to digest, citing, for example, potential medical complications, damage to property, or a stock market crash as reasons to save instead of spend. Perkins acknowledges the possibility of negative unforeseen circumstances and suggests looking into insurance policies that guard against unforeseen circumstances. This will allow you to invest in experiences while minimizing catastrophic financial risks.

(Shortform note: In The Psychology of Money, Morgan Housel provides additional approaches to minimize your financial risk. If you have investments, limit those investments to only a fraction of your entire savings. That way, if you lose money, you’ll still have plenty of savings to draw on. Additionally, have backup sources of funding in case your main source—like income from a job—disappears. This might simply be a savings account that you only tap into in emergencies. For people who are extremely risk-averse, a combination of these and Perkins’s approaches might be the best way to spend all your money before you die.)

For example, if you’re worried about crippling debt due to medical complications, you might look into long-term care insurance (which can cover costs not covered by health insurance should you ever need help performing activities of daily living). Alternatively, you might purchase life insurance to protect your loved ones should you die unexpectedly. Perkins also suggests an annuity to guard against the ‘risk’ of outliving your money.

(Shortform note: It can be challenging to navigate the world of insurance, so other experts supplement Perkins’s recommendations with their own. In The Wealthy Barber, David Chilton recommends only purchasing life insurance if you have dependents and your living estate (your assets minus your liabilities) wouldn’t be enough for your dependents to live on. If you’re interested in an annuity, make sure you understand the tax implications. These can often be complex, so it’s recommended that you work with an advisor to set it up. Finally, if you’re considering long-term care insurance, be aware that companies may deny you benefits for conditions like addiction or injuries sustained during war.)