I don’t know why it took me so long to dive into the book 2021 Die with zero By Bill Perkins. I have read it much earlier book That broke By Stephen Pollan and Mark Levine a long time ago when it was published in 1998. So I have been interested in the concept for a long time, even if I’m not sure if I’m really striving for it.
Die with zero Is an updated view of whether it is possible – and advisable – to spend your money in this life, die effectively with nothing (except great experiences and wonderful memories).
Perkins claims to save all of us from “over -saving and lower life”. That sounds great, in theory. But dying broke just doesn’t sound like something I want on my target list.
I have read the book, and although I am not completely convinced, here are my biggest collection restaurants.
Look at money differently
Perkins looks at how we can all make better expenditure decisions by considering what he calls our “net Worth curve” and balancing it with our “fulfillment curve”. This helps us to navigate decisions about whether or not enjoying (or delay) experiences that are expensive but fulfilling.
I invested in many adventures when I was young. Backpacking around the world. Working and studying abroad. Learn to ski and dive and diving and eating alone in a restaurant on the other side of the world without feeling uncomfortable. Never – even if I go through later financial challenges – I once desired that I had more money instead of those experiences, so maybe the author is busy with something.
I am no longer young, but I am not that old either. And I still have many experiences that I would like to bank. I will definitely balance my net value curve against my filling curve in future expenditure decisions.
Experiential stacking while you are young
While the idea of Increasing the return and the composite interest Tell us to save when we are young, there is also the argument that our earnings Stem will increase as we get older, so spend while we are young – especially about things that we can only really do when we are young – is not always a bad idea.
What is more, spending on great experiences When we are young, can give us lifelong memories, skills and opportunities for building character, while our happiness per dollar is still quite high by nature.
Let’s face it. We are all going to spend while we are young, so what we spend is about. Most physical purchases generally do not give us joy long because of the process of Hedonic adjustment. That is, we soon adapt to have a new possession that quickly decreases the joy on the purchase day as soon as we own it. But expenditure on experiences when you are young can have the opposite effect. As Perkins says:
“In contrast to material assets, which seem exciting in the beginning, but often quickly write off, experiences are actually in value in the course of time: they pay what I call a memory dividend.”
Being realistic about old age
Many people are obsessed with retirement. They save and plan and dream. And maybe that pays off, but often not. We will not all reach a retirement age and not all of us will be healthy enough to enjoy it as we were planning. One of the most important regret of older pensioners is not to spend more money early, while they can still enjoy it.
Depending on how well we have planned, some of us are richer in old age than we have ever been, but the costs often fall as we get older. We are often not fit enough to do things that cost a lot of money.
It is understandable that we are worried not to have money anymore when we live a considerable era. Perkins calls this “lifetime risk” and suggests that it is something you can plan by being realistic about your possible lifespan and health span.
The author examines the calculations that you have to do in the book, but it is sufficient to say that among those who have consistent, lifelong, middle to high income, the fear of not disturbing money, is much more common than the reality of no money anymore.
In this book you will learn to assess your life ‘time bucket’, to assess how much free time, money and health you have at various points in your life, so that you can plan accordingly. And yes. Shit happens. You could blind at some point by the unexpected, but that is no reason not to have a plan.
Give away while you are still alive
Most of us want to leave an inheritance for our children or loved ones. But it is not really necessary to wait until you die to offer support to those you love.
There are various benefits (including tax benefits – so talk to your adviser about this) to give your children money throughout your life. Money that they can use to put a deposit on a house, pay off student loans or perhaps even pay children.
Because some of us live much longer than before, your children can be on or close to retirement age when they receive that inheritance. There is nothing wrong with passing on generation, if that is your goal, but that is not what this book is about. If you want to make sure that your children have the best possible life, it is probably better to help them when they need it throughout their life, instead of hoarding your money to leave a great legacy behind.
Of course there is much more to die with nothing than this. If it is a concept that interests you, I recommend both Die with zero And Dying brackish. And of course talk about your goals with a professional. There is an art to spend life wisely and consistently for life and you have to personalize your plan and ensure that you have considered all your risks and opportunities.
My last conclusion? I am still not convinced that I want to broke, if I am honest, but I am convinced that I want to use some concepts in this book to live better.
#dying #practical