Die with Zero Ultimate Summary (very thorough) by Hue Chen

Thank you to Beth Azor, Barry Wolfe for recommending this book.

I live in a building with many retirees, I've heard time and time over that they felt they saved too much. That they should have enjoyed life more while they were younger.

NOTE: Not to sound too elitist, but this book's audience is really for millionaires & billionaires - whether you currently are one or you plan to be one. If you have the tendency to over-spend already .... to the point that you will have no savings at all for retirement, this book is not for you. This book is for those who tend to be over-savers and overly conservative (ie: me).

The basic premise of the book is that LIFE consists of

1. The collective decisions you make,
2. The experiences you have based upon those decisions and
3. The memories created by those experiences.

A worthy goal in life is to figure out how to maximize your life enjoyment and not your money accumulation.

If you think that your life enjoyment IS your work, it is likely you need to think harder and be more creative because when you are 90 years old you'll think back on all of your experiences and realize what really brought you enjoyment. Lets figure that out now!

Every $1 million that you die with could have been 3 years of enjoying memorable experiences with your family and friends, checking things off of your bucket list. By dying with $1 million you may not have squandered your money, but instead you squandered your life-experience hours!

Most people who have kids read "Die with Zero" and immediately think "What about leaving money to my kids?"

• Leaving money to your children upon your death is both random and is left to chance. Will they need the money at that time? Could they have used the money sooner? What if you outlive them?
• The average age of receiving an inheritance is 60 but the age at which the money would be most needed is between 26 and 35. Most of the time, the money arrives too late to make a difference.
• Putting your kids first means that you take care of them much earlier.

"What if I run out of money?" is another common concern.

• Are you working and saving as if you are going to live until 150 years old? Using life-insurance tools, figure out your likely lifespan. Use 90 for our example. You can purchase an annuity today that starts a payment of $5,000/mo when you turn 67 and continue to pay for the rest of your life. If you purchase this annuity at age 45 in 2023 that may only cost $350,000
• For unexpected large medical bills, the purpose of good health insurance or long-term care insurance policies are to smooth out the unexpected. Depending on your health, the costs may vary widely. For this very reason, the money you spend on keeping yourself in good health in your 20s, 30s and 40s will come back to you many times-over later in life. Perhaps it's $40,000 per year in total insurance costs.
• We make poor insurance and annuity underwriters. The "run out of money" concern can be addressed by a strategy of annuities and health insurance. Talk to your insurance agent for more info. [comment below if you can recommend one]

You spend less money in your "No-Go" years as compared to your "Go-Go" years.

• "Go-Go Years" = Your 20s to 40s, the time of your life when you have endless energy and experience rapid growth. You may have less money but you have a fair amount of time and the highest potential to be healthy.
• "Slow-Go Years" = Your 50s to 70s, the time of your life when you notice you're not as energetic as your early years. Parts of your body start to ache, but you can still travel, perhaps in business class rather than economy. You have more money, less time and diminishing health.
• "No-Go Years" = Your 80's to 90s, the last part of your life. As long as it doesn't hurt too bad, you leave it alone. Travel is definitely not as enjoyable or even possible. You have more money, more time, but you're the least healthy in your life.
• If you were spending $10,000/mo in your Go-Go Years, you might only spend $5,000/mo in your No-Go years. Even though your health expenses are higher, your house and car are likely paid off, you aren't going on many trips, you aren't buying many new items.
• You also spend far less in the later stages of life since the health limitations hamper the amount and types of experiences that could be had.

Your 20s - 40s

Asymmetric risk/reward: When the downside is low and upside is high it is actually MORE risky not to take the chance. Take the biggest risks when you have little to lose.

• Invest in your health early: The ROI on $$$ spent on your health at age 30 is 100X better than spending that same amount at age 75. There is a compound interest effect in investing in health early. For example, if you never become obese, your knees may never need surgery. With good knees you continue to move around so you may never have cardiovascular issues. With a lengthy time of mobility, agility and strength you'll be able to climb mountains at 68, bike trails at 72, and go sailing at 80. Join a gym, get a personal trainer, eat good food, the ROI is better than anything else you could put your money in over the course of a lifetime.
• Create a bucket list. Divide it into time-buckets depending how healthy you need to be to do them (ie: hiking Machu Picchu should be in your 20s or 30s). Likely the list will be front loaded, that is why you will spend more in your early years. Don't be afraid of taking Mini-Retirements.
• Live in the moment and be present. Too often we don't savor the moment, we are programmed to continuously look for the next best thing.
• Don't be afraid to move for better opportunity: You could make $70,000 more in California compared to Georgia but you are hesitant to move because you want to be near your family. In reality you might only see your parents four or five times a year. It cost $2,500 for a last-minute first-class flight from LAX to ATL. t would probably be less than $70,000 for the five times that you come. So in reality it is costing you $60,000 to stay where you currently are at. This is an example.
• It has been proven that spending money on experiences brings you more happiness than spending money on things. When you spend money on experiences, share amazing events with loved ones, those memories will live in your bank of memories for the rest of your life. During your "no-go" years when you are no longer able to ski down the black diamond, sit on a plane for 30 hours, hike a mountain or do an all-nighter, you can look back on those memories and pictures and re-live those moments in your mind. The joy those memories bring are the dividends that your memory bank is paying you. You need a certain physical state to get the most out of your money.

Your 50s - 70s

• Most people live their life on "auto-pilot," going with the inertia of earning money and going through life's motions but never truly understanding what fulfills them or could bring them joy. Most people live as if the "go-go" years will never end, putting off experiences to an undefined "later."
• We (you and I) make very poor insurance and annuity underwriters. Many people's excuse for making and/or saving millions more than they need is to have enough for unexpected circumstances, but that is exactly what purchasing insurance is for. If you were to purchase insurance or annuities at a known premium for the remainder of your life and not save millions more than you need to, it is likely more financially advantageous but more importantly you'll much more time to spend on life's enjoyment.

Come up with a plan to decumulate the money you accumulated.

• People avoid the subject of death like it's never coming. Plan your funeral now.
• Figure out the age where you want to hit your "Peak Net Worth."
• Your Peak Net Worth is the amount needed to live the rest of you and your spouses' lives at a level that is comfortable (even after taking into account gifts to family and charities along the way). More on that below.

Your 80s - 90s

What good is wealth without health?

• When you enter your last couple decades of life, you may experience the concept of Dying many mini-deaths. What this means is that there will be a last-time for everything and it doesn't have to coincide with your last day of living. The last time you take a plane, the last time you go to a concert, the last time you go on a rollercoaster, the last time you go dancing, the last happy hour with all of your high school friends, last festival, last day of work, last time to play tennis, last hike... Make sure you take the time to do those things before you cannot do them anymore.
• Don't finish rich in money but poor in experiences.
• Your real legacy isn't about money. Most people who are in 50's or 60's would rather their parents spend and enjoy their hard-earned money on themselves. Once you're near 60, it is likely you no longer need the extra help financially (you could have used it in your 30's though).
• Make sure you have great health insurance.
• This is controversial, however, the book brought up the following example. Imagine towards the end of your life, you had a extremely serious illness that required you to be bed ridden within a hospital. It is possible for the hospital to keep you alive for another 30 days, but at the cost of $1 million. Perhaps you have that money because you saved for just the circumstance. That $1 million, if you were to follow the book, would have allowed you to stop working 3 years sooner and experience all that life had to offer. So in essence, you traded 3 years of experiencing in your healthy years for 30 more days of life in you last year and at a quality of life that is very low. Consider making your healthy, good years as full as possible so that when your time comes you will have no regrets.

Calculating your optimal net worth according to the book (not sure if I agree with it - HC)

• Figure out how much per year you and your spouse can comfortably live off of and likely lifespan.
• Take 70% of the annual amount you can comfortably live off of as what you would want to save. (ie: if you feel like you can comfortably live off of $200,000 after housing, travel, charities, etc., then you would use $140,000 for each year).
• Your likely lifespan will be around 80 depending on your health, lifestyle and genetics.
• If you are 45 and use 85 as your lifespan for example, that is another 40 years.
• Assuming the $140,000 figure, that would mean $140,000 X 40 = $5.6 million.
• If you don't have that much at 45, then run the analysis using your projected earnings until you get to a point where how much you saved vs. the number of years left times $140,000 intersect.
• My personal opinion is that this is super tough to predict due to inflation, taxes and general economic performance. I'm pretty good at math but there are too many variables to consider. Just invest in income producing real-estate and make sure by the time you're 65 that you have very little debt on that real estate. Real estate is an excellent hedge against inflation and can create tremendous wealth over the course of a few decades. Sell-off the real estate as you need the liquidity.

Now that you have a plan, don't move the goal post!

• My peak Net Worth not including your primary house is probably around $6 million. Assuming my investments still yield 8%, that is $480,000 per year of dividends. That is amount that my wife and I could easily live off-of and do all of the charity, traveling, activities that we desire. This also provides some buffer for years that macroeconomic earnings are lower.
• Often people will say "if I save $1 million, then I will be set." When they get to $750,000 saved, they move the goal post to $3 million, then $10 million and so forth. At some point you are working past the point of optimal utilization of that money. People work past that point because they formed a habit of working. They work so much that they lost the creativity to turn that money into mind-blowing experiences.

DEFINITIONS

• In your middle years, when you are making money and have little time, you need to exchange money for time. This is called Time-Saving Purchases. Pay someone to move for you, pay someone to do your laundry and clean your house. Pay someone to do the things that take up time which you no do get enjoyment out of. As long as what you pay them per hour is less than what you earn per hour, that is positive leverage. Use the time savings on memorable experiences in order to add to your memory trust.... which will eventually pay out a memory dividend for the rest of your life.
• The concept of "Personal Interest Rate" is a bit complex. Basically you measure that in time. By how much time will you delay an experience if you could get double the experience later. If you ask a 21 year old "would you delay your 10 day trip to Europe this year if you could have a 20 day trip to Europe for the same price in 4 years?" What would they likely do? Change the number of years until they arrive at a number that they will agree to then that is their Personal Interest Rate - ie: if that person would accept double the experience by waiting 2 years instead of 4. Ask that same question to someone that is 75 years old and the time they would be willing to delay, it is likely the response would be 0 years delay no matter how much better the experience.
• There is also something called an Incremental Joy of Money. When you are 21 years old, flying 26 hours in coach to Thailand, staying in a hostel but seeing the world is tremendously fulfilling and enjoyable (and cost $3,000 perhaps). To get the same amount of enjoyment on a trip to Thailand at 65 years old, you may need to fly first-class, stay at a 4 star hotel and travel by a luxury van, costing maybe $30,000. You may get $10 worth of experiences for every $1 spent on experiences in your 20's with that perspective.
• A Memory Dividend is the lasting benefits of re-experiencing past experiences. If you are 60 years old and look back at pictures from your 30's climbing Mt Everest and reliving that moment, that is a Memory Dividend. Since you can relive those moments in your mind as often as you like, those memories experience compound interest!

Lifetime Fulfillment Curve

CASE STUDY: The Top Five Regrets of the Dying:

A Life Transformed by the Dearly Departing by Bronnie Ware

“I wish I'd had the courage to live a life true to myself, not the life others expected of me.”

“I wish I hadn't worked so hard.”

“I wish I'd had the courage to express my feelings.”

“I wish I had stayed in touch with my friends.”

“I wish I had let myself be happier”

Case Study: Sylvia Bloom, the legal secretary that amazed $8.2 million by the time that she passed away.

• She worked at the same company for 67 years and mimic her bosses stock picks over her life time. She worked until she died at 96 years old.
• To be able to have the money to invest: (a) she lived in a rent-controlled apartment, (b) took public transportation, (c) spent very little on herself.
• She did not have children on her own and donated over $8 million to charities upon her death.
• The book states that Sylvia Bloom is very generous but could have both maximized her life enjoyments and helped her charities decades sooner.
• She could have traded millions of earned dollars for years or decades of time to enjoy life, accumulating Memory Dividends especially during the years that she was most healthy. While she left her fortune charity, the parting of her and her fortune was an inevitability since you cannot take the money with you. Perhaps those charities could have used more spread out contributions decades sooner.
• Sylvia would be an example of the opposite of what the book is suggesting.

Case Study Chuck Feeny, the billionaire who was trying to go broke by giving away his fortune during his lifetime.

• Chuck Feeny is the billionaire who created an empire of Duty Free shops.
• His lifetime donations amount to $8 billion and during the last years of his life his net worth was down to less than $1 million.
• Chuck wanted to have a very active and mindful philanthropy experience. Coconsciously guiding the funds to where it would do the most good.

" If you want to give it away, think about giving now. It's a lot more fun than when you're dead".- Chuck Feeney

• He lived a life of extreme generosity as well as one that maximized his life enjoyment. This is what the book preaches.

The author recommended these books:

• Your Money or your Life: 9 Steps to Transforming Your Relationship with Money and Achieving Financial Independence. By Vicki Robin.
• Eat to live: The amazing nutrient rich program for fast and sustained weight loss, by Joel Fuhrman

The Author also recommended this Movie: Brewster's Millions

Here's another blog on the book "Die with Zero", it is very good: https://unwrittenbusinessguide.substack.com/p/the-unwritten-guide-on-how-to-die

Finally - if you would rather just watch a YouTube video talking about Die with Zero. Try this one: