I recently finished a book called “Die with Zero” by Bill Perkins.  Perkins, a successful hedge fund manager and poker player, argues the traditional mindset of maximising wealth for retirement is flawed. 

He identifies three key elements that are essential for living a fulfilled life: time, health, and money. He says the optimal enjoyment of life is at the intersection of these three factors.

• Time: This is a non-renewable resource. Once it’s gone, you can’t get it back. As you age, your available time decreases, making it an increasingly valuable asset.

• Health: Your health impacts your ability to enjoy different types of experiences. Like time, health tends to decline as you age. You’re likely to be more physically capable and have more energy when you’re younger. Therefore, certain experiences (like physically intense adventures or travel) may be more enjoyable or feasible earlier in life.

• Money: Money is the resource that allows you to buy experiences. Over time, through work and investments, you typically accumulate more money. But, as Perkins points out, having money in later stages of life when health has declined and time is short may not allow for the best experiences.

Perkins points out many people focus too heavily on the money element, often at the expense of time and health. They work hard to amass wealth for retirement but, by the time they retire, their health and energy levels may not be conducive to enjoying the experiences that money can buy and their primary focus is to continue accumulating wealth.

Perkins says we need to balance the three elements and take advantage of the time when you have both health and money to enjoy life’s experiences. He encourages spending and experiences during the periods of life when health is robust, rather than deferring all enjoyment and experiences until a traditional retirement age when health may limit your activities and desire to travel has waned.

He notes it’s also important to ensure that you have enough money for necessities, health care and potential emergencies in later life. Finding the right balance requires thoughtful planning and consideration of your own personal circumstances and goals.

Perkins advocates for a life rich in experiences. He suggests money is best used to create memories and fulfil life’s potential at all stages, not just in the post-work years. The title “Die with Zero” refers to the idea of having used your financial resources optimally to gain life experiences rather than leaving behind unspent wealth to the next generation.

But what about the kids, I hear you ask.  Perkins says instead of leaving behind a large inheritance (surplus funds not spent during your working life), it might be more beneficial to gift money to children at key moments in their lives when it can make a significant difference. Help with the down payment for a house, fund education or support them in starting a business. 

He also emphasises the importance of balancing future security with present enjoyment, spending money when you’re younger and healthier to make the most of it. He offers practical advice on managing spending, savings and investments to align with this philosophy.

The book invites readers to rethink their relationship with money, encouraging them to see it as a tool for creating memorable experiences throughout life rather than a security blanket for the future.

Based on Perkins pillars of Time, Health and Money, here are my five main takeaways:

1. Rethink Traditional Retirement Planning: Perkins challenges the traditional view of working hard to accumulate wealth for a comfortable retirement. Instead, he suggests using wealth to create fulfilling experiences throughout one’s life.
2. Memory Dividends: The author introduces the concept of “Memory Dividends,” which are the returns we get in terms of happiness and memories from the experiences our money can buy. Perkins suggests that these provide a much higher yield in terms of life satisfaction compared to financial returns from investments.
3. Experiences over Accumulation: Perkins underscores the value of experiences over the accumulation of wealth. Money should be seen as a tool for gaining experiences and making memories, rather than just a resource to be amassed and left behind.
4. Spend Sooner Than Later: Perkins encourages the idea of spending money when you’re younger and healthier, to enjoy what life has to offer. He emphasises that money is best used when you have the time and health to enjoy the experiences it can provide.
5. Balance Future Security with Present Enjoyment: While Perkins advocates for spending, he also stresses the importance of balancing financial security. The book offers advice on how to manage spending, savings and investments to enjoy life now, while still planning for a secure future.

When planning for optimal use of resources and life experiences, Perkins proposes working with a range of possible life spans based on actuarial data.  He says to consider other factors such as family health history, lifestyle and advances in medical technology.

He acknowledges the uncertainty and imperfection of these predictions and says it’s not about pinpointing a specific date, but about having a flexible plan and understanding that time, ultimately, is the most non-renewable resource we have.