Die With Zero - Book

[daylatedollarshort]

As I explained earlier, a portfolio double in value after 10 years assuming 7.5% annual return. A factor of 2 means I have double the income compared to if I had retired 10 years earlier. For example: a retirement income of $10K a month at age 55 versus a retirement income of $20K a month at age 65. Perhaps it was a misnomer.

As a side issue…since I am an engineer who likes to play with numbers…a guy who retires at 55 and lives 30 years translate to 30 x 12 x $10K = $3.6M. A guy who retires at 65 and lives 20 years translate to 20 x 12 x $20K = $4.8M. Hence early retiree loses $1.2M of higher quality of life in this example.

Granted people has more free time when they retire early but remember that people do get vacation time when working 10 years longer. Due to seniority my vacation time was 25 vacation days per year which was sufficient for me to increase my quality of life by $1M.

Why not work until you are 75 or 85 then to have even more money to buy yourself an even high quality of life? Why stop at 65?

 

[Music Lover]

As I explained earlier, a portfolio double in value after 10 years assuming 7.5% annual return. A factor of 2 means I have double the income compared to if I had retired 10 years earlier. For example: a retirement income of $10K a month at age 55 versus a retirement income of $20K a month at age 65. Perhaps it was a misnomer.

As a side issue…since I am an engineer who likes to play with numbers…a guy who retires at 55 and lives 30 years translate to 30 x 12 x $10K = $3.6M. A guy who retires at 65 and lives 20 years translate to 20 x 12 x $20K = $4.8M. Hence early retiree loses $1.2M of higher quality of life in this example.

Granted people has more free time when they retire early but remember that people do get vacation time when working 10 years longer. Due to seniority my vacation time was 25 vacation days per year which was sufficient for me to increase my quality of life by $1M.

I was getting 30 vacation days each year, plus I worked 4 day weeks 90% of the time, and also took leave without pay from mid-May to the beginning of July.

That was still too much work.

My quality of life is great and extra money won't change a single thing. I have a great GF, good health, and "enough" money to do everything I want. A bigger house, nicer car, etc. don't appeal to me. One of my favourite things to do is sit around a campfire strumming guitars with my friends and that costs me nothing. I'd rather to that than drop $500 at a high end restaurant.

 

[2177V]

Why not work until you are 75 or 85 then to have even more money to buy yourself an even high quality of life? Why stop at 65?

That is because getting $1M plus was enough for me to hire a servant who can wash my car, clean my swimming pool, work on my garden, and serve me meals and cocktails when I ask him to. Hiring two servants would not make me happier.

 

[RetiredAt55.5]

If I waited until 65 instead of 55, I'd have a lot more money.

But, my father passed at 63 from an aortic aneurysm and 2 brothers from cancer at 53 and 63.

Nothing's guaranteed.

 

[daylatedollarshort]

That is because getting $1M plus was enough for me to hire a servant who can wash my car, clean my swimming pool, work on my garden, and serve me meals and cocktails when I ask him to. Hiring two servants would not make me happier.

It still seems to me that pool services, car detailing services, gardening services, housekeeping services and Door Dash would be a less hassle and more cost effective way to outsource those tasks. But if you value the status of having a full-time "servant" then it was worth it to you work ten more years.

I like to read up on happiness studies like you have mentioned, and newer studies have concluded more money may be better than the oft quoted $75K annual income study. However, these newer studies usually mention factors like financial security, having good health care, control over one's life and not having to worry about losing your job. Most posters here, even those retiring 10+ years early, planned enough to cover those factors. I've never seen a study with factors like having a private beach or personal servant in any happiness study, but if you have a link I would enjoy reading about it.

Related link on a new Wharton Study: https://www.cnbc.com/2021/01/22/new-wharton-study-people-are-happier-when-they-earn-more-money.html -"During the Covid pandemic, income could matter a bit more for people’s happiness, Killingsworth says...“For example, if you have a financial cushion, you’ll be more able to ride out a period of unemployment, and if you have a high-paying job, perhaps it’s more likely you’ll be able to work from home and keep your job in the first place, all of which would give you more agency over your life,” he says...Ultimately, Killingsworth says that income is just one factor that influences an individual’s happiness — not the most important one. “If anything, people probably overemphasize money when they think about how well their life is going,” he said in the release....Indeed there are many factors besides money that contribute to a person’s happiness: Other research has shown that social relationships and connection are the most important contributors to happiness...Another thing to consider is how our work and earnings fit into our view of success. In Wharton study people were asked, “To what extent do you think money is indicative of success in life?” Those who equated money and success were less happy than those who didn’t hold the same view."

 

[ivinsfan]

That is because getting $1M plus was enough for me to hire a servant who can wash my car, clean my swimming pool, work on my garden, and serve me meals and cocktails when I ask him to. Hiring two servants would not make me happier.

Don't know if you are joking, but the term "sevant" went bye bye along time ago

 

[Teacher Terry]

Vchan, it seems odd to me that you reroofed your house but want to hire people to do much easier tasks. Anyway life has taught me that my family and friends are the most important thing plus my dogs. I have lost people I loved before retirement age and realized that time is the most important thing. One of my favorite posters (imoldareu) here who has passed on was a great role model for a retirement life well lived.

 

[Dtail]

Don't know if you are joking, but the term "sevant" went bye bye along time ago

I would say that VChan is not joking about having a servant.

 

[levindb]

As a retiree, I have 52 weeks of vacation a year, and if I do not use them, I lose them. Fortunately, every January 1, I get another 52 weeks.

For some people, having 25-30 days/year is all they want.
For other people, $3 million is all they want.

We each have our own priorities and preferences...some like steak, while others prefer Tofu.

The book tries to help folks understand that time and health are not endless, and at least we should think about choices that we may be making unconsciously...and I believe it does a good job at that.

 

[2177V]

Vchan, it seems odd to me that you reroofed your house but want to hire people to do much easier tasks. Anyway life has taught me that my family and friends are the most important thing plus my dogs. I have lost people I loved before retirement age and realized that time is the most important thing. One of my favorite posters (imoldareu) here who has passed on was a great role model for a retirement life well lived.

Hard physical work is challenging and keeps me young. Cooking, washing cars, cleaning my swimming pool do not keep me young and are a waste of my valuable time. I do appreciate that most people cherish their retirement time. However, quality of life is a factor too. A homeless guy has a lot of time on his hands but his quality of life is not so good.

I had retired after 34 years in the federal government at age 55 with a good pension and I could have stayed retired. However, I started working for the County under the Cal-Pers retirement system so I can double dip by taking home both my regular pay for the county and my federal pension at the same time. At age 65, I now earned two pensions plus a large IRA. I have no regrets because my county job had low responsibilities, high pay and good co-workers.

The balance between a higher quality of retirement life or more retirement time will depend on the individual.

While this is an early retirement forum, people needs to hear from both sides so they can make an informed decision. I made the decision to have the higher quality of retirement life and I fully respect people who gave up a higher quality of retirement life for a longer retirement.

 

[tb001]

Hard physical work is challenging and keeps me young. Cooking, washing cars, cleaning my swimming pool do not keep me young and are a waste of my valuable time. I do appreciate that most people cherish their retirement time. However, quality of life is a factor too. A homeless guy has a lot of time on his hands but his quality of life is not so good.

I had retired after 34 years in the federal government at age 55 with a good pension and I could have stayed retired. However, I started working for the County under the Cal-Pers retirement system so I can double dip by taking home both my regular pay for the county and my federal pension at the same time. At age 65, I now earned two pensions plus a large IRA. I have no regrets because my county job had low responsibilities, high pay and good co-workers.

The balance between a higher quality of retirement life or more retirement time will depend on the individual.

While this is an early retirement forum, people needs to hear from both sides so they can make an informed decision. I made the decision to have the higher quality of retirement life and I fully respect people who gave up a higher quality of retirement life for a longer retirement.

Perhaps, but there are many here who have both. We didn’t *need* to work longer to have the lifestyle we *want*. Sure we could have worked longer, but we already have a very high quality of life.

 

[Music Lover]

While this is an early retirement forum, people needs to hear from both sides so they can make an informed decision. I made the decision to have the higher quality of retirement life and I fully respect people who gave up a higher quality of retirement life for a longer retirement.

You are incorrectly assuming that people gave up a higher quality of life if they retired early.

 

[Dtail]

While this is an early retirement forum, people needs to hear from both sides so they can make an informed decision. I made the decision to have the higher quality of retirement life and I fully respect people who gave up a higher quality of retirement life for a longer retirement.

You are incorrectly assuming that people gave up a higher quality of life if they retired early.

Agree with Music Lover.
vchan - you are clearly associating a better quality retirement with the ability to spend more money.

Do you truly believe that the vast members of this forum only care about retiring early, but are willing to live a "lesser" lifestyle to achieve it?

The average posting member here has a multi million net worth and a perfectly happy lifestyle, whereby they don't feel like they are giving up anything.

I can tell you that some folks I used to support on Wall Street would probably consider your lifestyle to be beneath them, but that doesn't make them happier or sadder.

 

[MichaelB]

You are incorrectly assuming that people gave up a higher quality of life if they retired early.

I agree. There’s an underlying assumption that additional retirement funds come with no cost. I think members here are all aware of the trade-offs, have all compared the cost and benefit of working more, discovered the optimal point and made their choice.

 

[ncbill]

Time > money for most here otherwise why would they be perusing an ER forum?

The bottom line is that males waiting to age 65 to retire statistically will not live long enough to enjoy a full 30 years in retirement,.

But those retiring a decade earlier will.

And anyone claiming the richer your are the longer you'll live should go and read the Blue Zones book...those populations are living essentially subsistence lifestyles...they eat those healthy, unprocessed foods because that's the food they can afford...plus most get enormous amounts of daily exercise because that's what is required to put that food on their table.

In developing countries increased wealth usually means adopting more of a Western diet with corresponding increases in unhealthy outcomes like obesity, diabetes, & heart disease.

 

[Koolau]

That is because getting $1M plus was enough for me to hire a servant who can wash my car, clean my swimming pool, work on my garden, and serve me meals and cocktails when I ask him to. Hiring two servants would not make me happier.

Ahhh. I think you are beginning to understand the concept of "enough." At SOME point, we all find our "enough is "ENOUGH" level of income or net worth. Trading time to get to that level is valid if it is what you want. Only you can decide what "enough" is. YMMV

 

[finnski1]

As I explained earlier, a portfolio double in value after 10 years assuming 7.5% annual return. A factor of 2 means I have double the income compared to if I had retired 10 years earlier. For example: a retirement income of $10K a month at age 55 versus a retirement income of $20K a month at age 65. Perhaps it was a misnomer.

As a side issue…since I am an engineer who likes to play with numbers…a guy who retires at 55 and lives 30 years translate to 30 x 12 x $10K = $3.6M. A guy who retires at 65 and lives 20 years translate to 20 x 12 x $20K = $4.8M. Hence early retiree loses $1.2M of higher quality of life in this example.

Granted people has more free time when they retire early but remember that people do get vacation time when working 10 years longer. Due to seniority my vacation time was 25 vacation days per year which was sufficient for me to increase my quality of life by $1M.

I'm also an engineer who likes to play with math. There are lots of engineers on here that do the same. Heck I'm pretty sure everybody on here is well aware of the math and is good at it as well.

Not sure what you're trying to prove with the simple 4th grade math example. We are all aware of the trade offs of more money vs more time. Most have simply decided to have more time not working than more money and they can well afford it.

Let's see:
person A retires at 55. Happy and content for 30 years in your example.
You retire at 65. Happy and content for 20 years in your retirement.
I'll pick A.

 

[patela6]

Well said!

 

[daylatedollarshort]

And anyone claiming the richer your are the longer you'll live should go and read the Blue Zones book...those populations are living essentially subsistence lifestyles...they eat those healthy, unprocessed foods because that's the food they can afford...plus most get enormous amounts of daily exercise because that's what is required to put that food on their table.

vchan2177's servant will probably outlive him. - "People in the world’s Blue Zones......live in environments that constantly nudge them into moving without even thinking about it. This means that they grow gardens, walk throughout the day, and minimize mechanical conveniences for house and yard work....In fact, Blue Zones researchers determined that routine natural movement is one of the most impactful ways to increase your life span, and a common habit among the world’s longest-lived populations."

The longest lived people on the planet don't drink cocktails, eat steak regularly or have servants that wait on them hand and foot. They eat unprocessed peasant food like yogurt, beans and wild greens and have professions like goat herder, where they are on the move all day long.

 

[daylatedollarshort]

Ahhh. I think you are beginning to understand the concept of "enough." At SOME point, we all find our "enough is "ENOUGH" level of income or net worth. Trading time to get to that level is valid if it is what you want. Only you can decide what "enough" is. YMMV

I've never heard of any other poster here wanting a "servant" so that pretty much confirms we made the right choices for all of us by retiring early instead of working longer to save up for something we don't want or need.

 

[target2019]

Read the book

After reading the entire book Die With Zero, I can say with confidence that the author Bill Perkins has a different point of view than suggested in some of the posts.

The 8th chapter is Know Your Peak. One example given is that $2.5M certainly buys a better retirement than $2M. But the last $500K of savings probably brought more stress, thereby putting a hit on your health that could be significant in your remaining years. So the peak to know about is where time, wealth and health curves (discussed throughout the book) reach their maximum. This is the range of years where you can best enjoy major experiences.

The final chapter is Be Bold -- Not Foolish. Asymmetric risk is explained, and how will find opportunity with little downside risk. The examples given include specific career moves. In fact one of our children did that several times in the first few jobs, and has a long list of experiences that resulted from the "riskier" decisions. Most will probably think of just the salary and stock awards that could have accumulated by sticking with the first megacorp job. Maybe that's even the better choice for a typical middle-class employee. But for others there's adventure to be had, living extensively in other parts of the world and filling many bucket lists over. Of course the ability to absorb failure from risk declines with age. It suits the younger person who has more years to recover from a large loss if the risk does not pay off at all.

Until I read the jacket and conclusion, I didn't know that Bill Perkins has a list of significant accomplishments, such as energy trader, hedge fund manager, film producer, and high stakes poker player. Now that I've read the book and biographical data, his attitude and ideas seem obvious. The author's careers are an evolution of taking on more and more risk, which is not for the average bear. But smaller lessons can be learned by many from that.

As others who've read the book have said, now is a good time to spend some of your accumulated wealth on family experiences, for one example. By doing so we'll reap more experience dividends down the line in our remaining years.

 

[Teacher Terry]

Our ex governor (Kenny Quinn) was a multi millionaire and decided to go on his roof in Las Vegas to do a roof repair in summer. His wife begged him to not do it and hire it done. Unfortunately he fell off the roof at 75 and died. I would find something else to physically challenge yourself.

 

[aja8888]

Our ex governor (Kenny Quinn) was a multi millionaire and decided to go on his roof in Las Vegas to do a roof repair in summer. His wife begged him to not do it and hire it done. Unfortunately he fell off the roof at 75 and died. I would find something else to physically challenge yourself.

Yeah, roofs and ladders are tough assignments after age 65.

 

[levindb]

This is from another thread, but seemed appropriate for this discussion...
==============================================
The Beaujolais Bistro
A group of 40-year-old buddies discuss where they should meet for dinner. Finally it is agreed upon that they should meet at the Beaujolais Bistro because the waitresses there have low-cut blouses and really short skirts.

10 years later, at 50 years of age, the group meets again and once again they discuss where they should meet. Finally it is agreed that they should meet at the Beaujolais Bistro because the food there is very good and the wine selection is excellent.

10 years later at 60 years of age, the group meets again and once again they discuss where they should meet. Finally it is agreed that they should meet at the Beaujolais Bistro because they can eat there in peace and quiet and the restaurant is smoke-free.

10 years later, at 70 years of age, the group meets again and once again they discuss where they should meet. Finally it is agreed that they should meet at the Beaujolais Bistro because the restaurant is wheelchair accessible and they even have an elevator.

10 years later, at 80 years of age, the group meets again and once again they discuss where they should meet. Finally it is agreed that they should meet at the Beaujolais Bistro because everyone's heard it's good and they've never been there before.

 

[2177V]

I'm also an engineer who likes to play with math. There are lots of engineers on here that do the same. Heck I'm pretty sure everybody on here is well aware of the math and is good at it as well.

Not sure what you're trying to prove with the simple 4th grade math example. We are all aware of the trade offs of more money vs more time. Most have simply decided to have more time not working than more money and they can well afford it.

Let's see:
person A retires at 55. Happy and content for 30 years in your example.
You retire at 65. Happy and content for 20 years in your retirement.
I'll pick A.

A good retirement in my opinion is a retirement in which your standard of living in retirement is equal or better than your standard of living while earning an engineering salary.

At a minimum, this means your retirement income should be about 65% of your working salary assuming your house is paid off. People who retired with a lower standard of living can also be happy. I get that. In my case, my retirement income is about 180% of my former engineering salary when I was working full time. I could not have done that if I had retired at 55 and I did not take the opportunity to double dip.

Therefore....Your problem statement is wrong:
Let's see:

Person A who retires at 55 happy and content for 30 years.

Person B who retires at 65 with almost double the retirement income of person A, live like a king for 20 years and also has money to maintain his health better than person A and ultimately likely to live longer than 20 years.

I already picked B. Mainly because my job from age 55 to age 65 was an easy low stress job with friendly people and I enjoy coming in to work while double dipping and pulling in two paychecks with one job.

I admit that I was ready to quit in a heartbeat if my job started to sour. I always had an option to become person A but I never took that option mainly because the job was a 4 day 10 hours workweek with lots of vacation time. My thinking at that time was that having a 3 day weekend every single week plus generous vacation time is like having a "partial early retirement".

Most people under these circumstances would "probably" like to become person B if an opportunity opened up of having (1) an easy low stress highly paid second job, (2) lots of vacation time, (3) earning two paychecks with one easy job and (4) ultimately having a retirement income close to 2X than that of a 55 years old retiree.