Die With Zero?

"What am I even doing?"  Have you ever asked yourself that question?  Maybe it's the first thought you have when you wake up in the morning?  Or it comes while sitting at your desk as your timecard moves into the 70th hour of work for the week?  Or perhaps it was even while sitting in my office discussing account balances and investment returns.  Why save?  Why postpone?  Why do many of the financial things so many of us do without even thinking about it?  So often we're told to be good little ants - virtuously saving and planning for the future - preparing for that day when the metaphorical "winter" of our lives arrives - retirement.  But stop for a moment and consider a question.  Are we doing it all.... wrong?

That's what a book I recently read, "Die With Zero," by Bill Perkins, argues.  Perkins, a successful energy trader and hedge fund manager, posits that instead of saving and saving and saving some more, much of our adult life should instead be filled with.... spending!  And while it would be foolish to live every day as if it were your last, the sad truth is far too many people delay gratification for far too long.  Too often the most anticipated experiences of our lives are delayed to a point when they can't be fully enjoyed.  And, for the most unfortunate, money is saved for an experience that never gets experienced.  

Think about it - have you ever wanted to try water skiing? or visit Italy?  The reality is both of these experiences have an optimal time in our lives.  Some experiences, like water skiing, are best enjoyed when we are younger.  After all, would you advise your 90 year old mom or dad to go water skiing?  Of course not!  Water skiing is most enjoyable when you are younger and your body isn't weak and brittle - maybe in your teens or 20s.  What about that trip to Italy?  Sure, as a toddler we might enjoy Italian gelato, but I suspect we'll get a whole lot more out of seeing the Roman Colosseum or the canals of Venice when we're in our 30s or 40s. 

So, Perkins aruges, in lieu of working even more hours and socking away even more money while in the prime of our lives, we should instead seek to convert our earnings into priceless memories by matching our "net worth curve" with our "spending curve."  What this effectively means is most of the biggest and best experiences of our lives will naturally occur when our physical bodies can enjoy them most and when we can afford them - probably between age 30 and 55.  Perkins goes on to discuss memory dividends, which gain value over time as they pay out the enjoyment you had with a particular experience far after that experience ended.  

Of course, Perkins doesn't argue that you should spend all of your money (I wouldn't be discussing this book if he did)!  Rather, this is a book about balancing extremes and, to be fair, probably more about dragging the ant towards the grasshopper, than the other way around.  Want to learn more?  Send me an e-mail and I'll get a copy of this book to you in the next week.  Then we can talk about it at our next meeting!  

I've wanted to see the U.S. Women's National Soccer Team for a long time now, but tickets are expensive!  No matter, this summer I bought a pair and took my daughter, a soccer player, to the match.  The U.S. beat Ireland 4-0.