Die with zero book summary: 9 key takeaways
The average of death is 73.7 years old Die with Zero is a book about using 100% of your money to maximize enjoyment before that day comes Here are 9 key concepts from the book that will change how you think about money:
9 key concepts from Die with zero: getting all you can from your money and your life
1. Consumption smoothing
Consume roughly the same amount of wealth across your life. This means transferring money to your poorer years (youth, retirement) via debt or savings, respectively. Save less in your youth if you expect to make more money as you get older
2. Life = sum of experiences
Experiences don't have to be a big thing, and it doesn't have to be expensive. Running a marathon, trying a new local restaurant, taking your son for a walk in the park: all of these are experiences
3. Memory dividends
When you enjoy experiences, you get to enjoy the memories of those experiences. Like compound interest, the earlier you have those experiences, the longer you get to reap the rewards of those memories
4. Seasons of life
Your life has different seasons, and different experiences are enjoyed more during some seasons. Some experiences are locked out of certain seasons. Seasons are also defined by big life choices, such as marriage, parenthood, and retirement.
5. Flows of time, money, and health
Seasons are defined by the flow of time, money, and health, and major life changes
- In youth, you have time & health, but little money
- In adulthood, you have health & money, little time
- In old age, you have money & time, but little health
6. Play all four quarters
It's possible to guesstimate when you are going to die, insurance companies do it all the time. Doing so helps you think about your life in a more holistic fashion. It also helps you make the most of time when you realize how much of it you have left
7. Gifts > inheritance
It's suboptimal to wait until you are dead to transfer your wealth. If you live to be 85, your child will be in their 50s. The best time to give your children is between the ages of 26 and 35
8. Decumulation
At some point, the net worth number has to go down instead of up. typically between the ages of 45 and 60. Lowering your net worth on purpose requires a huge psychological shift
9. Bold youth
Take more risks when you have less to lose, typically when you are younger. Learn to distinguish between actual risk and irrational fear. Don't wait on taking chances that can't cause much harm to you