Executive Summary:

Maximizing Enjoyment of Wealth: In his book, Die With Zero, author Bill Perkins argues that the goal should be to maximize the enjoyment from your money while you’re alive, not just amass the most wealth.
Memory Dividends: Perkins introduces the concept of “memory dividends,” where the value of experiences grows over time, just like your investments. These experiences provide lasting memories, fulfillment, and enjoyment long after they happen.
Rethinking Wealth: Rather than focusing solely on maximizing net worth, Perkins advocates for investing in meaningful experiences earlier in life, when you’re healthy and able to enjoy them.
Balancing Enjoyment with Financial Security: While embracing Perkins’ philosophy, it’s critical to balance living for today with ensuring long-term financial security. This includes strategies like understanding safe withdrawal rates and doing ongoing retirement planning.
Give While Alive: Lastly, Perkins suggests passing wealth to heirs earlier in life when they need it most, rather than waiting until after death.

What if the goal of retirement wasn’t to leave behind the most money, but to maximize the enjoyment you get from your money while you still can?

In Bill Perkin’s book, Die With Zero: Getting All You Can From Your Money and Your Life, he challenges ‘traditional wealth management’ by calling for a more intentional approach to spending wealth throughout your life. Instead of focusing solely on maximizing wealth or leaving a large inheritance, Perkins encourages people to use their money to maximize meaningful experiences while they are still healthy (and alive) and able to enjoy them.

Central to Bill’s philosophy is the idea of investing in experiences (not just assets) that create lasting memories, or “memory dividends,” that provide ongoing value and fulfillment. Funny enough, Bill argues that just like traditional investing, investing in experiences is more valuable the younger you are, as it gives you extra years for those memories to “compound”, maximizing the total lifetime benefit you get from each experience.

To understand memory dividends, Bill writes:

“Think back to one of the best vacations you ever had, and let’s say it lasted a full week. Now think about how much time you spent showing pictures of that trip to your friends back home. Add to that all the times you and the people you traveled with reminisced about that trip, and all the times you’ve thought about it yourself or given advice to other people considering going on a similar trip. All those residual experiences from the original experience are the dividends I’m talking about—they’re your memory dividends, and they add up.”

In other words, memory dividends are the additional benefits we receive from our experiences long after they have ended.

The concept of memory dividends is a powerful one, as it encourages us to not only focus on investing to build wealth but also investing in experiences to build memories and enrich our lives. And these days, Perkins’ philosophy is gaining attention as more people want to balance living for the moment, while still setting themselves up for the future.

In this article, I want to layer my skills, views, and philosophies as a Financial Advisor on top of Bill’s philosophy of squeezing all the enjoyment out of your money while you can. Of course, I’m not advocating literally dying with no money left, as I believe that’s the opposite of what most people should be aiming for. But, I do believe there’s a strong case to be made for maximizing the enjoyment you get from your money while you’re still alive.

Let’s walk through that case together, starting with me and my awesome wife, Paige.

My Personal Experience With Memory Dividends

When my wife and I met, we were in our mid-20s, both working full-time, but with very little responsibility outside of our jobs (her as a receptionist at a medical office and me as an electrician). In other words, no kids, no pets, no mortgage – just a couple of young, working, and relatively unburdened people.

We were avid rock climbers at the time and would do a lot of weekend trips around the state – shout out to Utah and its collection of wonderful rocks! Naturally, we started to wonder how it would be for us to take a bigger trip, exploring crags all around the US. Maybe a couple of weeks, maybe longer?

One thing led to another, and the adventurous Paige decided it might be better for us to think bigger and spend a month and a half traveling around Europe, exploring the crags and sites abroad.

And so we did.

I didn’t realize it at the time, but that trip would create some of our fondest memories, contain some of the most unique experiences of our lives (homesteading on a small farm in Italy), and most importantly, (at least for now) would be once in a lifetime. That’s not to say we couldn’t ever travel to Europe for an extended period again, but, I don’t anticipate we’d be interested in traveling like we did: climbing gear and backpacks in tow, cheap Airbnbs, hostels, and even free accommodations through work exchange programs, all while flying by the seat of our pants with a loose (at best) itinerary.

When it was all said and done, we traveled for six weeks, visited four beautiful countries – Greece, Croatia, Slovenia, and Italy – and climbed rocks in some of the most striking places we’ve ever seen.

Fast forward to today and we’re in our 30’s, with a couple of young kids, and a ton more responsibility. We can’t travel like we did then without significantly disrupting our lives. But what we do have is the memory dividends from that ‘once-in-a-lifetime’ experience we created together.

Of course, from a financial perspective, we didn’t maximize our net worth with our decision to quit our jobs and travel around Europe. Instead, the trip probably cost us thousands of dollars at the time. But, it’s some of the best money we’ve ever spent, and it’s the reason I feel so aligned with Bill’s idea to maximize the enjoyment you get from your money while you can.

Now, let’s explore what that can look like for you.

What “Die With Zero” Really Means

Perkins’ concept of “Die With Zero” is not about spending down every last penny but rather about rethinking the purpose of wealth. He argues that too many people hoard their money with a focus on leaving a large inheritance or simply out of fear of running out. Instead, Perkins advocates for a strategic approach to spending—one that maximizes enjoyment and fulfillment during your lifetime.

His core message is that money can’t bring you joy once you’re gone, so the goal should be to use it while you’re alive to create meaningful experiences.

Again, the idea of “memory dividends” is central to this philosophy. Perkins believes that experiences, particularly those created earlier in life, provide a lifetime of return on investment. Just like Paige and I’s trip to Europe, the memories from these experiences grow more valuable over time, much like financial dividends, enriching our lives with each passing year.

So it’s not about spending your money for the sake of spending it, it’s about using it to enrich your life by doing the things you love, with the people you care about the most. Sounds great, right? But what about the risks?

The Risks of Literally Dying With Zero

While Perkins’ philosophy encourages maximizing enjoyment during your lifetime, it’s important to acknowledge the risks.

Running out of money in retirement can be a serious concern, especially if you live longer than anticipated or face unexpected expenses. Healthcare costs, in particular, can be unpredictable and significantly impact your financial situation in later years.

That’s why outliving your money is a key consideration in financial planning.

So, while it’s essential to enjoy your money during your life, it’s also critical to build a plan that ensures your needs will be covered for as long as you live. This might involve strategies such as utilizing safe withdrawal rates or running annual retirement projections to ensure that you are on track for success, and fine-tuning your plan as needed.

So, while Perkins’ philosophy is thought-provoking, it must be balanced with the practical realities of long-term financial security.

How You Can Maximize Enjoyment of Your Money

To fully embrace Perkins’ philosophy requires a mindset shift, and here are some examples to consider:

Don’t delay: Instead of exclusively waiting until retirement to enjoy your wealth, consider spending on meaningful experiences throughout your working years – possibly through a sabbatical or other extended time off.
Earmark funds: Next, just like you earmark funds for an upcoming purchase or investment, consider earmarking funds each year to spend on experiences.
Identify Optimal Experience Timing: When it comes to experiences, it’s critical to realize that not every experience is available (or desirable) at every age. For example, most people can’t or don’t want to go heli skiing in their 90s, so it’s critical to do that experience while you still can.

Again, balancing experience-driven spending with security is crucial. While it’s great to spend money doing the things you love with the people you love, it’s also essential to invest for the future, understand safe distribution rates, and have a plan for future needs.

A well-thought-out strategy can help you make the most of your money while ensuring you don’t jeopardize your long-term financial stability.

But What About the Kids?

In his book, Bill has an entire chapter dedicated to the question he says always comes up: “Sure, this sounds great, but what about the kids?”

For many wealthy families, leaving an inheritance for the next generation is a key goal, and some will even build in a specific amount they plan to leave after they pass. But, Bill argues that you shouldn’t wait until you’re gone to give money to the next generation. Instead, he believes that by giving money while you’re alive, you not only get to reap the benefits of watching the next generation enjoy the money, but you’re also more likely to give the money when it’s needed the most (when your heirs are young and starting their families, buying homes, putting kids through school, and more).

In Bill’s book, he explains that he has already given his kids close to 90% of their inheritance, which has empowered him even further to maximize the enjoyment he gets from his money, without worrying about what will be left for the kids.

In addition, he argues that by waiting until you die to give an inheritance, you’re subject to the three R’s: ”Giving random amounts of money at a random time to random people (because who knows which of your heirs will still be alive by the time you die?).”

Of course, there are valuable tax considerations to understand when giving money while you’re alive versus waiting until after you’ve passed, so it’s important to do your research when deciding what’s right for you.

If you want additional insights into the pros and cons of giving while you’re alive vs waiting until you pass, check out our article: Transferring Wealth: The Pros and Cons of Giving While You’re Alive vs After You’re Gone.

Wrapping it All Up

In the end, you don’t need to literally “die with zero” to take valuable lessons from Perkins’ philosophy.

Instead, his approach reminds us to live more fully and enjoy the wealth we have while we’re still here to benefit from it. To not delay experiences until it’s too late, and to consider passing wealth to the next generation when they need it the most, and, when you’re around to watch them enjoy it.

Ultimately, by reflecting on how you spend your money, and prioritizing experiences that bring lasting joy and fulfillment through memory dividends, you can find a healthy balance between living in the moment and securing your financial future.

Albion Financial Group is an SEC registered investment advisor. The information provided is intended solely for educational purposes and should not be construed as an offer or solicitation for the purchase or sale of any particular securities product, service, or investment strategy. Past performance is not indicative of future performance. Additional information about Albion Financial Group is also available on the SEC’s website at www.adviserinfo.sec.gov under CRD number 105957. Albion Financial Group only transacts business in states where it is properly registered, notice filed or excluded or exempted from registration or notice filing requirements.