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Die With Zero - Track 009

Die With Zero

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  • From Penny Pinching To Lighting Money On Fire
    • The author swung from extreme frugality in his 20s to reckless spending after advice to enjoy earnings growth.
    • He bought overpriced goods and drained his emergency fund, producing few meaningful memories despite high spending. Transcript: Unknown Speaker At the beginning of this book, I told you about the time my boss told me I was an idiot. You might recall I was a penny-pinching guy in my 20s, proud of myself for managing to save up money on my meager salary. My boss, Joe Farrell, knocked some sense into me by reminding me that I was on the path to earn much more money in the coming years, so I was foolish not to spend whatever money I was making Now. Joe Farrell didn’t just make this advice up. The idea that it’s rational for young people to be freer with their money is shared by many economists, even though it runs counter to the advice most of us grow up hearing. When we’re around 8 or 9 years old, our parents tell us to save some of our birthday money instead of spending it all. When we’re all grown up, financial advisors tell us it’s never too early to start saving part of our paychecks. Many economists, on the other hand, think that thrift among young people is generally a bad idea. When economist Stephen Levitt, of Freakonomics fame, landed at the University of Chicago as a first-year professor, a senior colleague named Jose Shinkman told him he should spend More and save less. The same advice that Shinkman himself had gotten from Milton Friedman, the even more famous University of Chicago economist. Your salary will only go up. Your earnings power will only go up, Levitt recalls his older colleague telling him, in almost a perfect echo of what Joe Farrell told me. And so, you shouldn’t be saving now, you should be borrowing. You should be living today in much the way that you’ll be living in 10 or 15 years. And it’s crazy to actually be scrimping and saving, which is what at least someone like me who was brought up in a middle class family was taught to do. Levitt says this was one of the best pieces of financial advice he ever got. I’d say the same thing about the nearly identical advice Joe Farrell gave me, even though for a time I took it too far. Joe’s words opened my eyes to a whole new way of thinking about balancing your earnings with your spending, and I was like a zealous convert. There was me before that talk with Joe, and a very different me after. Before, I had been living much the way people in the FIRE movement are living today, doing everything on the cheap, watching every penny, and saving as much as I possibly could for the Future. Then Joe’s words flipped a switch in me. Real fast, I swung from being a fire guy to a guy basically lighting money on fire. In the next few years, my income kept rising, just as Joe said it would, and my spending kept rising too. I was having a lot of fun. But unfortunately, I can’t point to a particular experience I had in those years that yielded much of a memory dividend. That’s because I was going bananas. Just spending money to spend money instead of being selective. For example, I’d buy a stereo system with a higher sound fidelity than my ears could perceive. Or I’d go to restaurants that were more expensive, but not that different from restaurants I dined at before. Basically, if there was a more expensive version of something, I’d go for it without thinking about getting the maximum value. In effect, I just went from autopilot save to autopilot spend. (Time 0:00:09)
  • Why Economists Advise Young People To Spend More
    • Many economists argue young people should spend more and save less because earning power typically rises with age.
    • Stephen Levitt was told by a senior colleague at Chicago to spend now and borrow, echoing advice Milton Friedman gave his students.
    • The argument is that living standards will increase, so it’s rational to match current consumption to future expected income rather than hoard early earnings.
    • This runs counter to common upbringing advice (save birthday money) and typical financial-planner guidance to start saving immediately.
    • The point reframes thrift in youth as potentially foolish when it causes you to miss valuable experiences you could afford later. Transcript: Unknown Speaker When economist Stephen Levitt, of Freakonomics fame, landed at the University of Chicago as a first-year professor, a senior colleague named Jose Shinkman told him he should spend More and save less. The same advice that Shinkman himself had gotten from Milton Friedman, the even more famous University of Chicago economist. Your salary will only go up. Your earnings power will only go up, Levitt recalls his older colleague telling him, in almost a perfect echo of what Joe Farrell told me. (Time 0:01:01)
  • From Frugality To Lighting Money On Fire
    • The speaker recounts Joe Farrell’s advice that young people should spend more because earnings will rise, a lesson he and economist Stephen Levitt received.
    • After that talk he rapidly shifted from extreme saving (FIRE-style) to unchecked spending—“lighting money on fire.”
    • Income rose as predicted, and so did his spending, but much of it produced little lasting memory value.
    • He bought marginally better versions of things (higher-fidelity stereo, pricier restaurants) without gaining more enjoyment.
    • The spending even drained his emergency safety stash, leaving him vulnerable if he lost his job. Transcript: Unknown Speaker I’d say the same thing about the nearly identical advice Joe Farrell gave me, even though for a time I took it too far. Joe’s words opened my eyes to a whole new way of thinking about balancing your earnings with your spending, and I was like a zealous convert. There was me before that talk with Joe, and a very different me after. Before, I had been living much the way people in the FIRE movement are living today, doing everything on the cheap, watching every penny, and saving as much as I possibly could for the Future. Then Joe’s words flipped a switch in me. Real fast, I swung from being a fire guy to a guy basically lighting money on fire. In the next few years, my income kept rising, just as Joe said it would, and my spending kept rising too. I was having a lot of fun. But unfortunately, I can’t point to a particular experience I had in those years that yielded much of a memory dividend. That’s because I was going bananas. Just spending money to spend money instead of being selective. For example, I’d buy a stereo system with a higher sound fidelity than my ears could perceive. Or I’d go to restaurants that were more expensive, but not that different from restaurants I dined at before. Basically, if there was a more expensive version of something, I’d go for it without thinking about getting the maximum value. In effect, I just went from autopilot save to autopilot spend. My spending also jeopardized my future. I wasn’t just spending all my discretionary income. (Time 0:01:52)
  • Fixed Savings Rules Break Over A Lifetime
    • A fixed savings ratio like the 50-30-20 rule cannot be optimal across all ages because utility of money changes over a lifetime.
    • Your optimal spend-save balance should shift as income, age, and ability to enjoy experiences change. Transcript: Unknown Speaker Why simple balance rules don’t work for everyone? I’ve also come to realize that this balance keeps shifting as you move through life. That’s also quite contrary to most personal finance advice. For example, some financial experts urge you to save at least 10% of your income each month or each paycheck. Other experts will suggest other numbers, like 20%. But again, they suggest you do this every month or week or paycheck, regardless of your age or financial situation. Let’s look at the 20% recommendation, which comes from a popular budgeting formula called the 50-30 rule. 50-30 comes from Elizabeth Warren. Yes, that same Elizabeth Warren. Before she entered politics, Warren had been a law professor with a special expertise in bankruptcy, and also co-wrote books about why middle-class Americans go broke and how to avoid That dismal fate. She suggested the 50-30 rule, which she called the Balance Money Formula, as a way to help people maintain financial stability. According to this rule, you should budget 50% of your income for must-haves, like rent, groceries, and utilities, 30% for your personal wants, like travel, entertainment, and dining Out. And the remaining 20% on building your savings and paying down your debt. The rule sounds like a great and simple way to achieve that goal, especially for people who may not have a good grip on their spending. It certainly caught on. But if you want to go beyond financial stability, that is, if you share my goal of maximizing your lifetime fulfillment without going broke, then you’ll need a more sophisticated way Of thinking about balance. To my way of thinking, no way can the same ratio of spending to saving be right for everyone. And more important, no way should your savings percentage be the same when you’re 22 as when you’re 42 or 52. (Time 0:04:48)
  • One Savings Ratio Doesn’t Fit Every Age
    • The common 50-30-20 rule is a simple starting point but assumes the same ratio works for everyone at every age.
    • Morgan argues your savings percentage should change as you age, earn more, and your priorities shift.
    • Treat balance as dynamic: spend more when experiences have higher value (e.g., youth) and save more when future constraints make spending less valuable.
    • Rigid monthly percentages (10%, 20%, etc.) ignore life-stage differences in health, time, and opportunity that determine when money creates the most fulfillment.
    • To maximize lifetime fulfillment without going broke, use age-aware rules rather than a fixed savings ratio. Transcript: Unknown Speaker For example, some financial experts urge you to save at least 10% of your income each month or each paycheck. Other experts will suggest other numbers, like 20%. But again, they suggest you do this every month or week or paycheck, regardless of your age or financial situation. Let’s look at the 20% recommendation, which comes from a popular budgeting formula called the 50-30 rule. 50-30 comes from Elizabeth Warren. Yes, that same Elizabeth Warren. Before she entered politics, Warren had been a law professor with a special expertise in bankruptcy, and also co-wrote books about why middle-class Americans go broke and how to avoid That dismal fate. She suggested the 50-30 rule, which she called the Balance Money Formula, as a way to help people maintain financial stability. According to this rule, you should budget 50% of your income for must-haves, like rent, groceries, and utilities, 30% for your personal wants, like travel, entertainment, and dining Out. And the remaining 20% on building your savings and paying down your debt. The rule sounds like a great and simple way to achieve that goal, especially for people who may not have a good grip on their spending. It certainly caught on. But if you want to go beyond financial stability, that is, if you share my goal of maximizing your lifetime fulfillment without going broke, then you’ll need a more sophisticated way Of thinking about balance. To my way of thinking, no way can the same ratio of spending to saving be right for everyone. (Time 0:05:02)
  • Your Savings Rate Should Change With Age
    • The same savings-to-spending ratio (like 80:20 or the 50-30 rule) can’t be optimal across your whole life because your income and sources of value change.
    • When you’re young with rising future earnings, saving a fixed 20% can be suboptimal; modest, responsible borrowing to fund high-value experiences can make sense.
    • Conversely, at older ages you must start saving for retirement and income plateaus, but there still isn’t a single magic savings rate that fits every stage.
    • The trade-off is between foregoing present memorable experiences and depriving your future self — aim to save as close to the “perfect amount” for each life stage rather than a constant percentage.
    • This reasoning rests on the idea that your ability to extract enjoyment from money shifts with age, so allocation of life energy should shift too. Transcript: Unknown Speaker And when you have many years of rising income ahead of you, it really doesn’t make sense to save 20% of your income. That would mean foregoing memorable life experiences you could be having, and it also means working to pay for a richer future self. A suboptimal use of your life energy, that’s for sure. Okay, suppose you agree with me that a balance of 80 to 20 is suboptimal for many young workers, but what about older workers? Obviously, at some point, you will have to start saving for your retirement when you will otherwise have little to no income. And it’s not just retirement you need to save for. There will almost always come times in your life when your income will hit a plateau or your spending will need to rise or both will happen at the same time. For all those eventualities, you do need to save money at some point, no doubt about it. When that time comes, you don’t want to save too much, because you’d be foregoing experiences you may never have again. And you don’t want to save too little either, because that would deprive your future self. You want to save as close to the perfect amount as possible. You want to achieve the optimal balance between enjoying the present and providing for a good future. But even when you do (Time 0:08:02)
  • Money Loses Enjoyment Value As You Near The End
    • A person’s ability to extract enjoyment from money declines with age, becoming minimal at the deathbed stage where even a private jet is useless.
    • Because enjoyment per dollar falls over time, saving too much late in life can mean foregoing experiences you’ll never get back.
    • The optimal balance between present enjoyment and future provisioning shifts gradually as you move backward from death toward youth.
    • Knowing roughly when you’ll die should influence how you allocate time and money across different ages.
    • Small changes in time horizon (days, years, decades) meaningfully change the tradeoff between living for today and planning for the future. Transcript: Unknown Speaker You can give them a private jet to anywhere in the world, but they’re just not going anywhere. Whether they saved up a million dollars or a billion, the money won’t make a real difference in increasing their enjoyment of what they’ve got left in life. Admittedly, this is a grim way of looking at the end of one’s years, but it does put everything into sharp focus. At this point in life, the only person with less ability to extract enjoyment from money is the one in the morgue or the grave. What does that have to do with you as a healthy 40-year or however old you are? Everything. I often think about those deathbed scenarios because the fact that we all die has implications for every day of our lives. We’ve all heard the hypothetical question, what would you do if you knew you were going to die tomorrow? The person asking this question often follows your answer with, why don’t you do these things now? Well, the obvious answer is that you will probably not die tomorrow, so it’s foolish to act as if you will. In general, when you will die should affect how you spend your time. As I mentioned earlier, if you knew you were going to die tomorrow, you spent a day one way, and if it was two days from now, you would spend a day slightly differently, because you’ll still Have tomorrow. The same is true for three days from now, four days from now, or 20,000 days from now. The further back in time you go, the more the balance shifts between living for today and planning for the future. So if you work your (Time 0:09:48)
  • Health Becomes The Ultimate Travel Constraint Over Time
    • Tim Ferriss argues that as people age, constraints on travel shift: under 60 it’s time and money; by 75+ it’s health.
    • Travel uniquely reveals how well someone extracts enjoyment from money because it requires time, money, and health simultaneously.
    • Health declines from peak in late teens/20s, often gradually enough you don’t notice until it limits activities you once loved.
    • Researchers found health steadily increases as a constraint with age rather than appearing abruptly at a single birthday.
    • The implication: prioritize time- and health-dependent experiences earlier rather than assuming you can defer them indefinitely. Transcript: Unknown Speaker But of course, none of us have forever. We need to keep that in mind so that we take optimal advantage of the time we have and don’t fall into the trap of living our lives on autopilot. Travel is a good example. To me, travel is the ultimate gauge of a person’s ability to extract enjoyment from money because it takes time, money, and, above all, health. Many 80-year just can’t travel much or far. Their health prevents it. But you don’t need to be completely debilitated to want to avoid some of the hassles associated with travel. The less healthy you are, the less you’re able to cope with long flights, airport layovers, irregular sleep, and other travel-related stressors. A study of people’s travel constraints, what kept them from traveling to a specific destination, not only confirms this intuition, but goes further than that. Some researchers ask people of different ages what prevented them from taking a trip. They found that people under age 60 are most constrained by time and money, whereas people 75 and older are most constrained by health problems. In other words, when time and money are no longer a problem, health is. And it’s not as if there comes one age at which people suddenly start having health problems that prevent them from traveling. Health problems were increasingly a constraint as age increased, the researchers reported, and were a major constraint to the oldest respondents. It’s a harsh reality. (Time 0:11:45)
  • Health Shrinks The Value You Get From Experiences
    • Health declines gradually with age, so activities you loved in your 20s provide less enjoyment later even if you remain active.
    • The same dollar buys less experiential enjoyment as your capacity falls (e.g., fewer ski runs per day = 75% of prior enjoyment).
    • People under 60 are mainly constrained by time and money; those 75+ are constrained by health, so timing of experiences matters.
    • Practical adjustments (longer breaks, fewer runs) preserve activity but don’t fully restore the original experience.
    • Because enjoyment capacity is finite and wanes, prioritize high-enjoyment experiences when health and energy are highest. Transcript: Unknown Speaker I still like football. But even as a healthy 50-year I can’t possibly enjoy it as much as I did when I was 20. I can’t run as fast, and I’m much more prone to injuries. When you’re afraid of tearing a rotator cuff or busting your knee, football just isn’t as much fun. Friends who are around my age agree. At a certain point, your memories of having played football are a lot more pleasant than actually playing football. This happens with all kinds of physical activities. Last week, I was playing tennis and noticed that my knees were kind of hurting, so I stopped. That wouldn’t have happened 20 years ago. My friend Greg, who loves skiing and is in great shape for his age, recently went skiing for seven days in a row, something he could have done easily when he was 22. But afterwards, he was in a lot of pain and realized that skiing seven days straight is too much for him now. This diminished enjoyment from declining health also has a real impact on how far your dollar goes, and skiing is a good example of this effect. Let’s say that an aging skier decides to continue enjoying the sport by giving himself more breaks or longer breaks between runs. Great idea, but that doesn’t mean he’s getting the same experience as when he was younger and stronger. If he used to get in 20 good runs in one day on the slopes, now he can only manage 15. In effect, the same amount of money he spent on that day of skiing now brings him only 75% of the skiing enjoyment it did years earlier. (Time 0:13:27)
  • Soggy Dollar Near Miss Drives Home Aging Limits
    • The author recounts a near-drowning scare with his girlfriend’s 69-year-old grandfather while swimming to a beach bar.
    • The episode highlighted how aging relatives misjudge physical limits and reinforced urgency to spend while healthy. Transcript: Unknown Speaker Yost Van Dyke. There’s a great spot on the beach called the Soggy Dollar Bar. It has that name because there’s no dock. People anchor their boats a little ways offshore and literally swim up to the bar, paying for their famous painkiller cocktail with wet dollars. Some people prefer to catch a ride on the back of a seabob, which they can do. But if you like swimming, you can have the full wet dollar experience. Well, that’s what my girlfriend’s granddad, Chris, age 69 at the time, wanted to do when he came out to visit. He’s a former swim coach and was raring to go. So in he and I went, into the water. It was a short swim, 30 yards or so. But about 20 yards in, I heard Chris yell, how much further? I yelled back that he could stand, the water was shallow. But he didn’t hear me. When I got to him, he was breathing uncontrollably. I quickly thought about CPR and whether we can get a defibrillator in time if this went south fast. Luckily, it didn’t come to that. Chris started to regain his composure, and after 15 minutes, his breathing and heart rate were normal. So he and I were able to enjoy a painkiller with our soggy dollars. Whew! (Time 0:15:16)
  • You Can Shape The Curve Of Physical Decline
    • Different body systems decline at different rates, so there isn’t a single health curve—bone density, lung function, vision, cardiac health, cognition, and smell each follow their own trajectories.
    • Group averages hide wide individual ranges: some people start healthier and some maintain health better, so ranges matter more than a single line.
    • Your behavior matters: maintaining health (e.g., not smoking) flattens decline and raises how much you can enjoy experiences in each year.
    • Despite effort, you won’t be healthier at 65 than at 25 if you were in normal health at 25—decline is inevitable but its shape is partly under your control.
    • That trade-off explains why timing experiences matters: invest effort in health to shift when you can best enjoy high-value activities. Transcript: Unknown Speaker So ranges are more telling than single curves are. But no matter what specific health data you look at or how many curves you combine, 80-year are a lot less healthy than 25-year To some extent, the rate of physical health decline is up To you. The better you maintain your health, the less steep your decline. For example, the lung function curve for non-smokers is a lot flatter than the curve for smokers. The better your health in a given year, the more you will be able to enjoy your experiences that year. So yes, you will decline, but you have a say in the shape of that decline. That’s a good thing, because the better you’re able to maintain your health during your lifetime, the higher your lifetime fulfillment score will be. But don’t kid yourself. (Time 0:18:22)
  • Spend While You Still Have the Health
    • Health declines with age, but you can influence its slope by how well you maintain it (e.g., non-smokers keep lung function longer).
    • Many experiences are time-sensitive: if you’re able to wakeboard at 50, you may not be able to in seven years, so do it now.
    • Money matters because activities cost; delaying spending until you’re older risks losing the ability to enjoy them.
    • The key rule: prioritize spending on experiences when your health lets you fully enjoy them, not when you assume you’ll always feel young.
    • Treat some purchases as “now-or-never” decisions and allocate money accordingly rather than hoarding for later. Transcript: Unknown Speaker The other day, my friends and I rented a boat and I thought about wakeboarding, which is like snowboarding on water. At age 50, was I still in good enough shape to do it? Probably. Would I be in good enough shape seven years from now? Definitely not. This activity had to happen now or never, so I decided to go for it. I don’t want to get to the end of my days when I no longer have my health and realize there were things that I wanted to do that I didn’t do earlier, when I was able to. Your ability to enjoy many experiences in life depends on your health, but money plays a part too, because a lot of activities cost money. (Time 0:19:25)
  • Money Loses Utility As Health And Interests Narrow With Age
    • Emery warns that while feeling young is fine, you must be realistic about physical limits as you age because health determines enjoyment.
    • He recounts noticing elderly relatives who couldn’t spend money or had very narrow desires, illustrating that interests and capabilities shrink over time.
    • As health and creativity decline, many activities become impossible, so money’s usefulness falls—eventually you only want basic comforts.
    • Therefore you should spend money while you still have the health to enjoy experiences, not hoard it for an age when you can’t use it.
    • The decline in money’s utility isn’t linear from birth; it starts later and accelerates as physical capacity and interests narrow. Transcript: Unknown Speaker Here’s the point. Too many of us still view ourselves on an ongoing basis as being in our 20s, even though our real age is somewhere in our 50s, 60s, or even 70s. While it’s admirable to view oneself as young at heart, it is also necessary to be realistic and objective about your body and how it’s aging. You have to be mindful and aware of your physical limits and how they are steadily encroaching upon you as you get older, whether you like it or not. I first started thinking about these things after that time I gave my grandmother $10,000 and discovered she just couldn’t spend it. All she really wanted to buy at that point was a sweater for me. I started noticing the same kind of thing with other older relatives, and I thought, these are my ancestors, so I’m probably going to be that person too at some point. And it occurred to me that everybody becomes like that eventually. As you get older, your health declines and your interests gradually narrow. Just as your sex drive diminishes, your creativity usually declines too. And when you’re extremely old and frail, no matter what your level of interest is, just about all you can do is sit and eat tapioca pudding. At that point, money is useless to you. Because all you need or want is to lie in bed and watch Jeopardy. This was my conclusion. The utility or usefulness of money declines with age. It was also clear to me that the decline doesn’t start from birth. (Time 0:20:07)
  • Shift Savings Rate As Your Life Changes
    • Adjust your savings rate across life: save less when young, ramp up as income rises, then oversave in midlife and gradually spend down later.
    • Tailor this to personal factors like favored activities, income growth, and locale. Transcript: Unknown Speaker Whenever you shift in order to spend money, you are necessarily also shifting when to save. So, for example, instead of saving 20% of your income throughout your working years, some people would be better off saving almost nothing in their early 20s, as we discussed, then Gradually ramping up their saving rate during their late 20s and 30s as their incomes begin to rise. Then they should save even more than 20% in their 40s and then slow down their savings so eventually, as I explain in the next chapter, they actually start outspending their earnings. Notice that I’m being careful to say some people would be better off doing that. Everybody’s situation is different. For example, some people’s favorite activities, such as merely walking, are inexpensive. Others don’t require tip-top physical health. How much you should save also depends on how fast your income grows from year to year, where you live, and how fast your savings grow. Because of all these variables and all the possible combinations they produce, there is no one-size rule. There you have it. (Time 0:23:33)
  • Real Golden Years Occur Before Traditional Retirement
    • The ‘real golden years’—when health and wealth overlap—often occur before age 65 and are when you should do most spending.
    • Many people delay gratification past the point where future spending yields maximal fulfillment. Transcript: Unknown Speaker We’ve all been told, like so many hard-working, diligent aunts, that we need to save up our money for the golden years of retirement. But ironically, the real golden years, the period of maximum potential enjoyment because we have the most health and wealth, mostly come before the traditional retirement age of 65. And those real golden years are the years during which we should be doing most of our spending, not delaying gratification. Too many people are making the mistake of investing in their future well past the point when those investments will ever pay off in ways that increase their overall lifetime fulfillment. Why do they persist? I think a lot of it is just inertia, or as I call it, autopilot, of doing what’s worked in the past. Sometimes it’s better to spend now, and other times you’re better off saving up and investing your money for a potentially better experience in the future. At the extremes, this is easy to see. Obviously, if you keep hoarding your money and don’t spend any of it, your fulfillment curve will be minimal. And if you spend all your money now, you won’t have any for the future. (Time 0:24:57)
  • Trade Money For Time In Middle Age
    • Balance health, free time, and money by exchanging abundant resources for scarce ones: young people value time, middle-aged buy time with money, old people spend money on health.
    • Use cash to buy time-saving services when time is scarce. Transcript: Unknown Speaker Think about the three basics people need to have to get the most out of life. Health, free time, and money. The problem is that these things really all come together at once. Young people tend to have abundant health and a good deal of free time, but they don’t usually have a lot of money. Retirees in their 60s, 70s, and beyond, the other end of the spectrum, have abundant time and often more money than young people, but unfortunately, they have less health and thus a Diminished ability to enjoy the time and money they do have than the young do. What happens in between these two extremes? I think of this period as the real golden years because it usually includes a good combination of health and wealth. For example, a 35-year is still healthy enough to do most of the things a 25-year can do, but typically earns a lot more. A 40-year and even more so, a 50-year generally has slightly worse health than the 30-year but still has a pretty high degree of health, and generally a higher income than either the 25-year or the 35-year So people in these middle years, neither very young nor very old, typically have a different problem. They face a time crunch, especially if they have children at home. This time crunch is their biggest obstacle to having positive life experiences. Not that children don’t bring plenty of positive life experiences, they do. But between changing diapers, driving to various lessons and practices, and taking care of the larger household, there’s just less time for other experiences. The same is true if you don’t have children, but find yourself working longer hours earning money than you did in your 20s. To get the most positive life experiences at any age, you must balance your life, and this requires you to exchange an abundant resource in order to get more of a scarce one. Every group already does this to some extent, though I believe they often get the magnitude wrong. Specifically, young people exchange their abundant time for money, sometimes to a fault. They should prize their free time more than most do. Old people spend a lot of their money trying to improve their health or at least to fight disease. People in the middle years sometimes trade money for time. And the more money they have, the more of it they should be using to buy time. (Time 0:27:18)
  • Health Time and Money Peak in Midlife
    • Life value depends on three resources: health, free time, and money.
    • Young people have health and time but lack money; retirees have money and time but less health.
    • The middle years (roughly 35–50) often combine sufficient health with higher earnings, creating a ‘golden’ window for high-value experiences.
    • The main obstacle in midlife is a time crunch (kids, work), not lack of money or health.
    • To maximize lifetime fulfillment, shift some spending toward ages when you can both afford and physically enjoy experiences. Transcript: Unknown Speaker Think about the three basics people need to have to get the most out of life. Health, free time, and money. The problem is that these things really all come together at once. Young people tend to have abundant health and a good deal of free time, but they don’t usually have a lot of money. Retirees in their 60s, 70s, and beyond, the other end of the spectrum, have abundant time and often more money than young people, but unfortunately, they have less health and thus a Diminished ability to enjoy the time and money they do have than the young do. What happens in between these two extremes? I think of this period as the real golden years because it usually includes a good combination of health and wealth. For example, a 35-year is still healthy enough to do most of the things a 25-year can do, but typically earns a lot more. A 40-year and even more so, a 50-year generally has slightly worse health than the 30-year but still has a pretty high degree of health, and generally a higher income than either the 25-year or the 35-year So people in these middle years, neither very young nor very old, typically have a different problem. They face a time crunch, especially if they have children at home. This time crunch is their biggest obstacle to having positive life experiences. Not that children don’t bring (Time 0:27:18)
  • Invest In Health Early To Avoid Compounding Decay
    • Prioritize health investments early because small declines compound into large future losses in enjoyment and mobility.
    • Do preventative actions like better diet and strength work to flatten decline and increase lifetime fulfillment. Transcript: Unknown Speaker Nothing has a greater effect on your ability to enjoy experiences at any age than your health. In fact, health is actually a lot more valuable than money because no amount of money can ever make up for very poor health. Whereas, people in good health but with little money can still have many wonderful experiences. And that’s not just true in the extreme case of terrible health. Just being significantly overweight can put a damper on your enjoyment of life, if only because of all the extra pressure additional weight puts on your knees. I’ll bet you know people who, because of bad knees or weak muscles or just self-consciousness about their bodies, avoid many experiences that others around them take pleasure in, Such as hiking or ziplining or delighting in the water and sun on the beach. Or they go on the hike with everyone else, but they’re huffing and puffing, really struggling to eke out any kind of enjoyment out of this potentially fun activity. Some of these people might even have been athletes when they were younger. It’s just that when they stopped being physically active, they continued to pile along the calories until they were 30 or 50 pounds overweight. It’s easy for that to happen, especially for people with jobs that consume most of their waking hours and energy and require sitting in front of a computer screen all day. And to what end? When a demanding job finally brings you financial success, do you still have the key ingredient, health, for enjoying that success? Healthcare providers understand this problem better than most of us, just because of the many suffering patients they see. But even people working in healthcare aren’t immune to neglecting their own health. Let me give you just one example. This one with a happy ending. Stephen Stern, a chiropractor in Massachusetts who went public with his own decades-long struggle with weight, had been treating aching patients for decades and yet allowed his Weight to yo-yo. He’d take up exercise and lose some weight, but then he’d stop exercising and gain all the weight back, losing whatever physical fitness he had worked hard to achieve. When Stern was 59, he finally realized he couldn’t let this pattern continue, not if he wanted to avoid the fate of his less fortunate patients. As an article about him put it, he’d seen patients his age and younger who’d lost the ability to do things they loved, not just through injury or illness, but often through simple neglect Of their bodies. He knew that when people at this stage of life lost physical capabilities, often they never got them back. So Stern was determined to become fit again before he turned 60. This time he took a more gradual path to fitness than he had in the past. His body could no longer take the intense training regimens he had put himself through in his younger years. But he could still regain a great deal of fitness through walking and calisthenics. And this slow but steady approach worked. His old knee pains disappeared, and by age 66, he found that he could perform impressive feats of strength and balance, like a bent knees handstand. His efforts at improving his fitness paid off in renewed confidence and competence, and in joyous experiences he wouldn’t otherwise have, like summiting mountains with his daughter. Though he can now do things most 30-year cannot, he knows he’s never going to be as fit as a fit 30-year What he’s actually accomplished is peak health for his age. I’m an older man, and I move the way an older man can move. Stories like Stephen Stern’s are inspiring. We all want to hear that it’s never too late. But that’s not why I’m telling you the story. The reality is that sometimes it’s really too late to reverse the decades of neglect and abuse, something stern understood. And even when it’s not too late, it’s always better to have started investing in your health earlier. What I’m really trying to get across is that improved health improves everything in your life, makes every experience more enjoyable at every age. In our three-pronged model, where fulfillment from a single experience is a function of health, money, and free time, health is the single biggest factor, or multiplier, affecting The size of a person’s lifetime fulfillment curve. Our simulations show that even a small permanent reduction in health at some point in a person’s life amounts to a large reduction in the person’s lifetime fulfillment score. Why would that be? Why does health affect lifetime fulfillment more than either free time or money? When adjusting the health input, we are adjusting the rate at which your body will decline. How fast your body’s health declines depend on how in shape or not you are now. So if you are 2% from optimal health now, you may be 20% from optimal health 10 or 15 years from now. Basically, there is a compounding effect to being in poor health. I don’t claim to be a doctor, but here is an example of how I see it working and how it impacts your enjoyment of activities. Let’s say you are 10 pounds overweight. That doesn’t seem so bad at first, but each pound of excess weight means 4 extra pounds of force on your knees. 10 pounds of excess weight is equivalent to 40 pounds of excess force your knees were not designed to handle. Naturally, over time, the cartilage in your knees will deteriorate and tear, and perhaps your bones will start to rub against each other. Your natural shock absorbers have been worn out, making it painful for you to walk for any extended period, and running is pretty much unbearable. This leads to more weight gain and other associated problems. It’s no wonder that knee replacement surgery is one of the fastest-growing surgeries in the USA, closely tracking the rise in obesity. In any case, that seemingly inconsequential 10 pounds ballooned via compounding into other serious health problems and a lack of enjoyment of activities associated with walking. As I’ve stated before, movement is life, and your experiences will be greatly diminished when your movement becomes painful or limited. There are many paths of decay until we ultimately die. We all wish to have the greatest physical function until we die, yet many of us will have greater exponential decay at an earlier time in our lives, resulting in lower ability and lower Enjoyment, as a result of how we have treated our bodies. Einstein supposedly called compound interest the greatest force in the universe. Small changes in health can lead to a negative compounding that has enormous impacts on your lifetime fulfillment and experience points. The good news from all of this, if you take even small steps to improve your health now, improving even 1% and avoiding the negative compounding effects, you will have vastly increased Your total experience points. There’s a clear implication in this observation, and it’s one you’ve doubtless heard before. People of all ages should be spending more time and money on their health. (Time 0:29:59)
  • Chiropractor Stephen Stern’s Slow Path Back to Fitness
    • Stephen Stern, a Massachusetts chiropractor, struggled with decades of weight yo-yoing despite treating patients with similar issues.
    • At 59 he decided he couldn’t repeat the pattern after seeing patients lose abilities from neglect, not just injury.
    • He aimed to regain fitness before 60 but chose a gentler program because his body no longer tolerated intense training.
    • By focusing on walking and calisthenics he relieved knee pain and recovered substantial fitness over time.
    • The example shows small, sustainable habits can restore capabilities lost through long-term neglect. Transcript: Unknown Speaker Let me give you just one example. This one with a happy ending. Stephen Stern, a chiropractor in Massachusetts who went public with his own decades-long struggle with weight, had been treating aching patients for decades and yet allowed his Weight to yo-yo. He’d take up exercise and lose some weight, but then he’d stop exercising and gain all the weight back, losing whatever physical fitness he had worked hard to achieve. When Stern was 59, he finally realized he couldn’t let this pattern continue, not if he wanted to avoid the fate of his less fortunate patients. As an article about him put it, he’d seen patients his age and younger who’d lost the ability to do things they loved, not just through injury or illness, but often through simple neglect Of their bodies. He knew that when people at this stage of life lost physical capabilities, often they never got them back. So Stern was determined to become fit again before he turned 60. This time he took a more gradual path to fitness than he had in the past. His body could no longer take the intense training regimens he had put himself through in his younger years. (Time 0:31:33)
  • Health Multiplies Lifetime Fulfillment
    • Health acts as a multiplier on how much you enjoy experiences across your life, more than money or free time.
    • Small, permanent declines in health cause large drops in lifetime fulfillment because health loss compounds over time.
    • Your current health sets the rate of future decline: being slightly off now can become much worse decades later.
    • The author illustrates the compounding effect with a concrete example showing how modest excess weight increases physical strain (and thus reduces enjoyment).
    • Conclusion: investing in health earlier yields outsized returns on lifetime enjoyment compared with delaying that investment. Transcript: Unknown Speaker In our three-pronged model, where fulfillment from a single experience is a function of health, money, and free time, health is the single biggest factor, or multiplier, affecting The size of a person’s lifetime fulfillment curve. Our simulations show that even a small permanent reduction in health at some point in a person’s life amounts to a large reduction in the person’s lifetime fulfillment score. Why would that be? Why does health affect lifetime fulfillment more than either free time or money? When adjusting the health input, we are adjusting the rate at which your body will decline. How fast your body’s health declines depend on how in shape or not you are now. So if you are 2% from optimal health now, you may be 20% from optimal health 10 or 15 years from now. Basically, there is a compounding effect to being in poor health. I don’t claim to be a doctor, but here is an example of how I see it working and how it impacts your enjoyment of activities. (Time 0:33:42)
  • Buy Back Your Time With Money
    • Outsource time-consuming, low-enjoyment chores (like laundry or cleaning) when the money you’d spend is less than the value of your time.
    • Example: at $40/hour, two hours of laundry costs you $80 in time; paying a service $50/week is a net gain.
    • Spend that reclaimed time on high-value activities (kids, exercise, friends) that create memories and satisfaction.
    • Ferriss started outsourcing chores in his 20s despite lower income to prioritize experiences — those weekends became lifelong memories.
    • As income rises, trade more money for time because time is finite and yields greater marginal value than extra cash. Transcript: Unknown Speaker Suppose your work nets you $40 an hour and suppose laundry takes you two hours each week because you’re slow and inefficient at this chore. A professional service that has better equipment and does laundry all day every day is much more efficient than you are and can turn a profit even while charging you $50 or less. Is it worth it to spend $50 per week on a service that picks up a week’s worth of your dirty laundry and delivers it clean and neatly folded the following week? Absolutely, because at $40 per hour, two hours of your time is worth $80. This is true even when you are not using that time to earn money. You can be using the time to take your kids to the park, or read a book, or meet a friend for lunch, or whatever you would enjoy more than doing the laundry. Laundry is just one example. The same logic applies to any undesirable chore, like house cleaning. To me, this kind of outsourcing always seemed like a no-brainer. So much so that I started doing it in my 20s, when I had a much lower income. Even then, I would choose to spend a Saturday morning rollerblading in Central Park and going to brunch at Sarabest rather than cleaning my apartment. And thank the Lord that I chose to spend that money because I now have lifelong memories of many pleasant weekends. The more money you have, the more you should be using this tactic because your time is a lot more scarce and finite than your cash. I’m constantly trading money back into time. I’ll never get more than 24 hours in a day, but I can do my utmost to free up as much of that finite time as I possibly can. (Time 0:39:40)
  • Spend Money To Buy Time And Better Experiences
    • Paying others to do chores (laundry, cleaning) trades cash for scarce time and often produces greater life satisfaction.
    • A field experiment found time-saving purchases reduced time pressure and improved daily mood, and repeated lifts in mood raise overall life satisfaction.
    • Paying to avoid disliked tasks both removes negative experiences and creates space for more positive ones, increasing happiness.
    • Even if you regret past trade-offs (working instead of experiencing in your 20s), you can rebalance by prioritizing experiences while you still have health and free time.
    • The value of an experience shifts with age, so think about when to spend to maximize enjoyment rather than just saving for later. Transcript: Unknown Speaker Here’s how I see it. If you pay to get out of doing tasks you don’t enjoy, you are simultaneously reducing the number of negative life experiences and increasing the number of positive life experiences, For which you now have more time. How can that not make you happier with your life? You might realize with some regret that you got the balance wrong. For example, let’s say that you’re now 35 or 40, and in your 20s, you spent all your time making money and therefore missed out on lots of great experiences. Although you’ll never get those years back, you can try to rebalance your life now. Therefore, you need to really focus on having more experiences now, while you still have a high degree of health, and spending more than a person your age who didn’t trade all that time For money. For every moment, there is an ideal experience to be having in that moment. (Time 0:42:02)
  • Your Personal Interest Rate Rises With Age
    • Personal interest rate rises with age: older people require much higher compensation to delay experiences because those experiences may not be available later.
    • Terminal illness pushes the rate effectively infinite—no payment can justify delay. Transcript: Unknown Speaker You know how I’ve proposed that your ability to extract enjoyment from money declines with age? Well, the corollary to that is that the older you are, the more someone should have to pay you to delay an experience. How much they should pay you is what I call your personal interest rate, which rises with your age. This idea immediately hits home for people in finance who are used to thinking about interest rates and the time value of money. Let me explain. Suppose you’re 20 years old. At this age, you can afford to wait a year or two to have an experience, because you can typically have the same experience later. Therefore, your personal interest rate is low. Someone doesn’t have to pay you much for you to be willing to delay the experience. Let’s say you wanted to take a trip to Mexico this summer, but your boss said to you, I could really use you here this summer. I know you wanted to take this Mexico trip, but would you consider taking it next summer instead? I would pay you X percent of the price of the trip to do that. Okay, interesting offer. So how high would X have to be for you to agree? 10%, 25% Now suppose you’re 80. At this point, delaying the experience becomes much more costly. So your X would have to be much higher than when you were 20. Even if someone paid you 50% of the price of the trip to delay, you should not necessarily take the offer. Your personal interest rate at age 80 may be higher than 50%. It might even be higher than 100%. What happens if you’re terminally ill? Once you know that you won’t be around a year from now, your personal interest rate is off the charts. There is no amount of money someone can pay you to delay a valuable experience. So your personal interest rate rises with age. (Time 0:42:54)
  • Personal Interest Rate Rises With Age
    • The author defines a “personal interest rate”: how much someone must pay you to delay an experience, and it increases as you get older.
    • At 20 your personal interest rate is low — you can wait for experiences because you’ll likely get them later.
    • By 80 the cost of delaying is much higher; even 50% compensation may not be enough.
    • If terminally ill, the personal interest rate is effectively infinite — no payment justifies delaying valuable experiences.
    • Reminder: we often behave as if this rate is constant, but treating it as rising should change how you time experience spending. Transcript: Unknown Speaker Well, the corollary to that is that the older you are, the more someone should have to pay you to delay an experience. How much they should pay you is what I call your personal interest rate, which rises with your age. This idea immediately hits home for people in finance who are used to thinking about interest rates and the time value of money. Let me explain. Suppose you’re 20 years old. At this age, you can afford to wait a year or two to have an experience, because you can typically have the same experience later. Therefore, your personal interest rate is low. Someone doesn’t have to pay you much for you to be willing to delay the experience. Let’s say you wanted to take a trip to Mexico this summer, but your boss said to you, I could really use you here this summer. I know you wanted to take this Mexico trip, but would you consider taking it next summer instead? I would pay you X percent of the price of the trip to do that. Okay, interesting offer. So how high would X have to be for you to agree? 10%, 25% Now suppose you’re 80. At this point, delaying the experience becomes much more costly. So your X would have to be much higher than when you were 20. Even if someone paid you 50% of the price of the trip to delay, you should not necessarily take the offer. Your personal interest rate at age 80 may be higher than 50%. It might even be higher than 100%. What happens if you’re terminally ill? Once you know that you won’t be around a year from now, your personal interest rate is off the charts. (Time 0:43:00)
  • Use One Now Versus Two Later To Decide Delays
    • Use a one-now-versus-many-later test: ask would I rather have one trip now or two similar trips X years later, factoring expected investment returns.
    • Only delay replicable experiences that benefit materially from waiting. Transcript: Unknown Speaker When you face a choice such as whether to go on a trip on your next vacation or to save your money for later, ask yourself, would I rather have one trip now or two such trips X years from now? Here’s how to figure out what X is. Whenever you have some discretionary income, whether it’s $10, $100, $1,000 or more, you have a choice. You can spend the money now or you can save it for later. If you save it for later, there’s potential for the money to grow. Because unless you’re putting it under your mattress, you’re investing in something like the stock market that promises a rate of return above the rate of inflation. This inflation-adjusted interest rate is called the real interest. The longer you let the investment grow, the more money you end up with. So after a number of years, your principal, $100 for example, could double to $200 or even triple to $300. The real interest rate varies, but let’s take the example of 8% annual growth. That’s a little more than the average stock market return since its inception, again, after adjusting for inflation. At that rate, your $100 becomes $147 in 5 years. In 10 years, it becomes $216. More than enough to buy two of whatever experience you thought about buying now. The question is, should you wait nine to ten years to get two of the experiences you could have today? It’s totally up to you. And your answer will depend a lot on the kind of experience it is, as it should. For you to even consider the choice of one now versus two or more later, the experience has to be one that can be replicated. Once-in events like weddings and graduations of family and best friends obviously can’t. You should also think about whether the experience might actually be better if you delay it. Sometimes by waiting, you can use the extra money to buy a significantly better version of the same experience. I could tell you, for example, that experiencing Las Vegas at 40 is much better than Las Vegas at 20, assuming you have significantly more money at 40 than 20. It’s like two different Las Vegases. I’m not saying that no 20-year should go to Las Vegas. My point is there are times to delay gratification because doing so will net you more life experience points. So it depends on the experience you’re trying to have. (Time 0:45:47)
  • Use The App To Compute An Optimal Spending Plan
    • For precise lifetime spending, use the Die With Zero app to compute an optimal annual spending plan based on health, time, and money inputs.
    • The app personalizes recommendations but isn’t required to act on the book’s principles. Transcript: Unknown Speaker Introducing the Die with Zero app. Throughout this chapter, I’ve been talking about balancing the spending and saving you do throughout your life. I’ve already explained in general terms that you should shift spending to more or less the right ages. And you understand three factors that most affect your ability to enjoy your life energy. Health, free time, and money. But if your goal is to maximize lifetime enjoyment, that means finding out how much to spend each year. A number that varies depending on each person’s circumstances. To find that number, I needed a computer program that takes in each person’s individual circumstances and runs a bunch of calculations to determine the optimal spending plan for that Person. I’m happy to say that, with the help from an economist, I’ve developed this app. Now, using this app isn’t necessary for getting more out of your life energy. You’ll be able to do that just by following the advice throughout this book. But if you want to be even more optimal, if you want to squeeze out every available bit of your life energy, the app can help. (Time 0:48:52)
  • Act On One Health Improvement You Can Start Now
    • Reflect on health-limited experiences you can have now and pick one way to invest time or money to improve health for future enjoyment.
    • Start with concrete actions like learning better eating habits or doing more enjoyable movement. Transcript: Unknown Speaker Think about your current physical health. What life experience can you have now that you might not be able to have later? Think of one way in which you can invest your time or your money to improve your health and thereby improve all your future life experiences. Learn about how to improve your eating habits to improve your health. One of the many books on this subject, one I know well and always recommend, is Eat to Live by Dr. Joel Fuhrman. Do more of the physical activities that you already enjoy, such as dancing or hiking, that will also improve your enjoyment of future experiences. (Time 0:50:05)