I remember speaking to my Dad weeks before he passed away. He felt so guilty because he went on a little vacation and spent $10,000. I told him he should do that more often. His kids are doing just fine on their own. We don't need anything you might leave us. I told him to please enjoy it and don't feel guilty at all. He earned it and should enjoy it in his retirement.
Watching Erin read the quote: "Say it. Say it Erin." Erin ... does not disappoint. Now, I'm 63 years old and retired. I have this piece of advice for any and everyone. Want to control your stress? Keep your finances under control. Want to be happy? Pay off your credit cards, pay off your home, pay off your auto loans. Your stress level will fall and your happiness will increase. I've seen too many people living on the edge of their financial resources. Then times get tough. They lose a job and can't find a job. They lose the house with a mortgage, second mortgage and third mortgage. They used that money for boats or RVs or motorcycles. Bankruptcy ensues. The marriage is stressed or broken. Forced into retirement and they are forced to live on next to nothing and if a health crisis happens, everything else can be gone as well. Yes, enjoy your life .... but save your money.
You nailed it Gary When all debts (including the house) is paid off..then and only then you can afford to be generous Be careful on giving $ to Charities..my own mum that lived near RI gave 200k to Jamaican Scam Artists..what a waste! Another thing is to have income streams..NOT PENSIONS..when you die all pensions stop..if you have income streams your kids will get your income streams Borrowing is evil..paying with cash is sacred...this comes from Pastor Dave Ramsay who worships at the altar of Financial Independence Can i get an amen?
Good advice!! I have one more thing to add. Be very careful about how you interact financially with people that hold this kind of philosophy. Once they have exhausted their resources their only choice will be to turn to you.... I speak from experience.
Coming from a 57 y/o old to the young crowd... 1) Save 10% in your 401K and no more. Rest 20%-30%-40% of your income in a brokerage A/C and into Dividend growth ETFs. This way if you choose to retire early, you can easily do it with the earning/dividends from your brokerage A/C. No need to bust your ass till 65 if you want to retire early! 401K is only good but for a very long time horizon! 2) Geo arbitrage to a LCOL country and buy private insurance until you reach Medicare age!
I agree with all of the main points from the book. Super savers can take their health for granted, and life is about balance. I'm personally not fulfilled by budgeting, saving, and investing. I'm fulfilled when getting to my financial goals allows me to have experiences with the people I care about. Money is a trust-based currency to get goods and services with, not a goal in and of itself.
Very true! (and I still stand by if can be really hard to nudge super savers into spending - speaking as a super saver - but it's just as important to spend on things you enjoy) You sound like you have a really great balance! 😊
Totally agree with you about the “going in debt” part for experiences.. it’s absolutely ridiculous …..I read it too and thought that if a young person read this and followed this a lot might be broke all their lives.. and to be honest when you are in debt you won’t be enjoying life coz you are constantly stressed everyday……
For us, super savers, the book must dwell on the shelf in front of our eyes ..(After reading the book , being 65, I certainly aimed for new targets....no regrets and not looking back) For me and my wife it served as an eye opener. I definitely agree with the remarks you mentioned. Thank you, and please summarize more up to date personal finance books.
Aaron, you are wise beyond your years. I've only recently started looking at my life in these terms, looking at giving away my wealth to my airs now so that I can enjoy seeing the fruits of my labor. Being a part of first homes, weddings and graduations that I've helped along the way will bring me more joy and anything I purchased for myself. Watching you glean ideas that compliment and and some that are extremely contrarian to your beliefs is enlightening. Glad to see you take away so much from one book.
My wife and I are 64, in our eighth year of retirement. We saved more than most at our income level but I wouldn’t call us super savers. As we think about memories, the best memories are the great vacations we had and the time we spent with our loved ones. I also think about the possibility of outliving our money, which is unlikely but nevertheless on my mind a lot. No, I don’t want to die with zero because we can’t predict our death very well. But I do encourage everyone live the day-to-day below your means so you can have great experiences throughout your lives. The balance is hard to hit but trying to live a balanced life with a good job, good savings and great experiences along the way is my advice for a worthwhile and fulfilling goal.
Good morning, keep up the good work, I still can't get over your financial story about being completely debt free and feeling so good about owning a home. You're doing a great job with your channel!
This one really spoke to me. It is important to find life experiences that make you happy but don’t cost a lot of money. We have a tendency to equate high dollar things with things that make us happy.
Im learning how to spend more, after saving all these years. It's not easy to change a habit, specially when you feel guilty spending. My first full time Job after leaving school, as a teenager back in the early 80's paid me AU$2.60 an hour. That was a hard drudgery working in a factory, back then. Now life is so easy.
Difficult to just change gears and start spending. Especially when everything is paid off, you have all the household goods you need, cars, etc. What do you spend it on - just eat out and travel more ? That gets old after a few years. But we are trying to do more fun things and the trick that helped was taking a weekly "allowance." I chose $500/week. I hit the bank machine for cash and will use that to puck up a lunch tab/etc. when out with friends. If I don't spend it, I keep track in a spreadsheet and save up for large purchases - we have upgraded flights to first class a few times which was nice on those 8-10 hour flights. That has helped us, but as we get older we just want less so we are gifting more to young relatives and charities. Whatever works - good luck mate !
Had an economic professor in under grad. He said his daughter asked him since he was an economic professor, he was going to leave her a lot of money right? He told her, no, since I'm an economic professor, my plan is to spend my last penny as I take my last breath, you're on your own kid.
@@ErinTalksMoneyI think you get them launched and give them the tools to be fiscally responsible, after that…. When I was 20 and finishing college my mom said I’m selling the house and you have three months to find a place to live. Best thing that ever happened to me. I got myself together quickly and never looked back.
I read this book too... I'm a saver so I expected to read some contrary opinions. He makes some really good points on the value of experiences and some of the trade offs involved. However I think he underestimates how miserable people are when broke, how much having wealth gives you options, and the value of never going broke.
the author is assuming that working is a waste of time but I think most times it can give our life some meaning. Just ask retirees. I retired at 42 and I am 50 now. Although I hated my job at the time it did give me some purpose everyday, I enjoyed talking to co-workers, I took advantage of weekends. As a retired person, sometimes the only person I talk to in a day is my kid. Yes, I travel, but even that gets old.
Erin: I’ve always wondered about this book. Haven’t bought it yet. Your insightful, challenging, nuanced personal take on this book 📕 and it’s assertions is exceptional! In this age of lazy, regurative, black and white thinking, this video and your channel as a whole are a true breath of fresh air!
Erin you are fantastic! I can't recall a book summary better than this. So informative and clear. I love it. You did a great job. And I learnt something today. Thanks.
Your getting better and better every video. You are clearly getting more comfortable and sound much more conversational than when you started. All I can say is way to go! Big,big thumbs up!
One can learn from many sources. You don't have to agree with every word but as someone who is planning to retire early a lot of the concepts of this book sound spot on IMHO. Of course, don't blow it all on one night in Vegas but your life is precious and it should be enjoyed to the fullest. I know too many people who died prematurely and never really enjoyed their life and money. That, happens more than you think.
The book makes some excellent points and some terrible ones. It is clearly written by an extremely wealthy person who is removed from the realities of the middle class. The good points are: 1. prioritize experiences, 2) enjoy your life as much as possible while you are able-bodied enough to do so, and 3) help your children financially when they are young (as long as they are hard working and will put the money to positive use). The bad points outweigh the good ones, however. They are 1) Spend money now because spending money is the only way to enjoy experiences (false), 2) spend more than you earn, 3) estimate your likely longevity and plan to spend your money down ...this is easier said than done and assumes you'll not eventually be a $300k per year long-term care burden on your children. The greatest anxiety you can face in your golden years is .....running out of money.
Hi Erin! Life is all about balance. You can’t be such a tightwad that you never spend and you save, save, save. On the other hand you need to be wise and save for the future and take care of your family and others where possible. I think your sentiments were right on with this book. Good to see that you are repping your alma mater! I think of freezing cold though when I think of Northern Michigan! Have a great week Erin!
I loved northern Michigan - coldest weather I have ever experienced was -45 🥶 🥶 🥶 (PS, I don't like the cold....but Michigan is beautiful ...in the summer 😂 )
Erin, my parents are currently working through Roth conversion- so that my brother and I don’t pay it in taxes. I told them exactly this, LAST WEEK, spend it all- enjoy your money, you set us up so we (hopefully) won’t need it. Also me: checking my spreadsheet to see how much money my kids will inherit, based on conservative assumptions, after my wife and I pass away at any age from retirement to 120. I love your passion!!!
I have that same attitude - to my parents, you worked hard, you enjoy what you have saved for a lifetime. Then I would want to turn around and save it up when I eventually have a kid to pass it on to them to make their life easier 😂😂
I'm doing the exact same for my daughter so take it from me, they are doing everything they want to do in life and don't want to see their hard earned money going to Uncle Sam when you only have ten years to pay the taxes. Likely, it will be on top of your working income and put you in a high tax bracket. It makes them feel good, empowered even. Hope that puts it in perspective for you.
I loved the book. The graphs/triangles in the book are great visuals to help folks understand that many activity windows close and guard against over frugality at the expense of missed life experience opportunities. The story of the trader that took the trip to Europe when in his mid 20's is a great example of maximizing an experience that is age sensitive on the level of joy the experience can create. Wholistically, I agree with the message of the book and as an early retiree, it is so hard to open the spigot and spend after a lifetime of savings. Continued compounding above your expense burn only means your estate will grow at the expense of missed opportunities aka using the tool of money to create lifelong memories for yourselves or your offspring that continue to pay dividends. Keep posting the great content!!
I hear you - experiences truly do pay a different kind of dividend, a valuable memory dividend! The book had a lot of great points! (I just cannot wrap my head around, "spend more than you earn.")
Great video! I'm a saver and I enjoy your content. Life is a balance with money , always be prepared for a rainy day. Live your life the way that makes you happy!
Life is about balance. We have spent on experiences that we will remember for a lifetime and have also saved for the rainy day or the time when we don't have to work if we choose not to. For us it has been about buying what we need and occasionally splurging on experiences that we want. Did we buy the biggest house we could? No, we bought what we needed because we knew we wanted to have enough left over to go on vacations, save for the future, and be there for the ones we love. Do we buy new vehicles every few years? No, we haven't had a car payment in years because cars just don't mean that much to us other than to be reliable and get us from point A to point B. Honestly, I get what the author of the book is saying, but I also cringe on parts of it. Yes, spend some today, take some risks when you are young, but also save for your future self as well. One of the gifts we are giving to our kids is that they don't have to worry about us as much as we age. We've got it covered.
I get the feeling that Mr. Bill Perkins is a little out of touch with the lower and middle class of America. He is the son of a professional football player, went to a 'preparatory school', and now is a hedge fund manager, and film producer. The advice he is giving MAY be for those who already have some level of money to support their life style. Can you see someone making $22,600.00 a year in this market buying a home, having children, and meeting all other financial requirements and still planning to go on a cruse to somewhere? My feelings are that this book is written for the upper class who already have a firm financial basis.
I had that same thought. Professor Google estimates his net worth at $60,000,000 - so it is probably easy to make such bold statements when you are at that level of success.
Same applies to all these unrealistic headlines like " you should save this much by this age" or " you need this much to retire". It's all BS that's so far removed from the real world hardships of the average man/ woman.
First, it was smart to rent the book from a library. With that said, you do not know your needs when you grow old. It really depends on the kids you have, but many times giving your kids money is doing them a disservice if all they do is spend to "keep up with the Jones" or live beyond their means. It is extremely important for your kids to learn to live within their means while they are young. It is not selfish to save money for your old age so that you do not become a burden on your kids. Nursing homes are extremely expensive. The alternative is letting your kids take care of you at home which is an extreme burden. I watched three daughters go on shifts to be with their parents in the home 24/7 to take care of them. After about 3 years, it got to the point that the parents had to go in a nursing home as it was beyond their ability to care for them. If it was not for the savings the parents had, the burden on the family would have been extreme. The children were very thankful that their parents had the money in savings during this time. With that stated, many (and maybe most) people may not go in a nursing home. However, you do not know which group you will fall in when you are old. You were right to be outraged about living beyond your means and counting on future pay raises. You do not know if the pay raises will happen, and, if you will even have a job 1 year from now. This book mixes some good advice with a lot of bad advice.
I really enjoyed your analysis and review of this book given that I have a very similar mindset/perspective as you do about money and time (as I'm sure many others watching do too). I've decided to borrow this book from my local library. I don't expect to agree with much of it, but given life is an endless pursuit of knowledge, one must lend an ear to the other side and take their preachings in equal measure if they wish to attain any sense of a whole understanding of something.
This book is definitely for financial fanatics to remeber life isnt about accumuluating money. But, if you live paycheck to paycheck or suffer from debt, not time to read this book
Love your response in this video. Your passion around #5 was awesome, and I agree with you. I do agree with the author on generosity after death is no where near the same as generosity during life. The money has to go somewhere.
I don't plan to die with zero. I want to leave something to the kids that will make life comfortable, but not so much that it would impact the way they live! That "kids" money will also be our cusion for some catastophic event late in life, that could derail the retirement of a surviving spouse. As, nice shirt. NMU I would asume.
Anyone that has run a Monte Carlo simulation on their retirement savings should realize that in the VAST majority of successful retirement plan scenarios you will reach the end of life with FAR more money than you "need." That's prudent. Not wasteful.
Erin this author sounds like a young idealistic kid who comes from money, anyone who grows up poor doesn't think this way. You will do whatever it takes to never be poor again!
Just because something is expensive doesn't mean it's going to add that $ amount of value to your life. I got a pretty good idea of what will add real value to my life, and I do spend money on the things that bring me enjoyment. Other than maybe some trips when I get a bit more money, I'm happy and always grateful for what I have in my life and feel like there's really not much else I need that I couldn't buy right now.
I actually agree with the author on giving when you’re alive. You’re making a sacrifice and taking on risks which is a generous effort. The intent is all there. When you’re dead you’re essentially leaving behind your leftovers. Technically it’s giving because it’s a gift, but the intent of giving isn’t really all there.
I like the fact that this book has many seemingly disparate pcs of advice. It shows that the author is open minded and understands that we're not all built the same with the same objectives and goals. It's important to remember that we don't all have to agree 100% of time. When it comes to advice, know yourself well enough to understand what advice you should take to heart and what you should ignore. Use what works for you and leave the rest.
You’re best video yet! I’m 50 and trying to save as much as I can for retirement.. My goal is to retire from my crappy ole job at 59-1/2 at the latest.. There’s a lot of happiness in having money in your account.. trying to spend it down to zero.. that would not be good for my health.. if I have money when I die.. I’m sure my wife will enjoy herself.. lol
I had planned to work to 60 as late as my 55th birthday. A year later, I could see my job stress was being misdirected at my wife. Not in an extreme way but she is such a great person, I knew she didn't deserve to have to live with a guy that seemed to be angry at the world . I decided I would retire 6 months later. I'm a planner and knew everything would work out. I didn't expect my retirement account would still have the same balance, five years later, with no Social Security. And I have been generous and doing what I want. You sound responsible so don't be surprised if you retire a few years earlier. You can always get a "fun" job to supplement.
Without knowing how long you will live, it is difficult to do what the author suggests. Also, being frugal is a source of happiness for some people; the author shouldn't try to gaslight them into spending more money. The danger of this author's advice is how it would affect people with low income and low net worth. It would likely only lead to more spending for them when they should be doing the opposite. Regarding giving money to the young, many parents do save for college funds for their kids, and things of that nature.
Good morning. I liked your video. I had a whole book written about my perspective on life as a response. I deleted it and changed to just good morning.
@@ErinTalksMoney Most folks don't like my view of life and the end of it. I do agree with you, you don't play on credit. When I raced I raced on my funds. When those funds dried up I quit racing. My friends that raced said they race on credit card and then paid them off in the winter. Nope, not for me. That makes no sense. I know for a fact that they never paid them off over the winter. All that interest paid on top of the general expense of racing. Now I have used credit cards for other reasons. When my business went south I tried to keep it alive using my credit cards. I reduced my paycheck so I could keep it going. But in the end I wound up with about $45K worth of CC debt and another 10K to the IRS. Then the company folded. Was it worth it. Fiscally, no. I learned a lot though and from that perspective it was probably cheaper than college and more applicable. :-)
while watching this (great video) hubby asks what meal out will cost for upcoming birthday; told him; he points pair of shoes he wants instead! Get real, “you will get both!” We are OLD, buy what you want and yes we will eat steak at restaurant for your birthday!He’s too funny!
What if you miscalculate your expiration date by 10, 20 years? You will do your kids a big disservice by now being financially dependent on them. Leaving my kids a huge inheritance is not my top priority but at least expect to keep our principle intact from date of retirement and that will be a nice windfall. I believe that is happy medium.
Liked your criticism. Personally, me and my wife spend on experiences but still keep on saving .(we are retired) Excellent idea to introduce and discuss relevant books.
The comment about inheritance is very on point. We are in our early 60’s and our parents are in their 80’s. We don’t need any money from them. Makes more sense to go to the grandkids, or give it a lot earlier. We want to die with zero also, but figuring out when you will die is impossible, even if you get very ill. I’m a big believer in enjoying life along the way, BUT, money is not the only thing that matters. Once you are old you realize that your needs, wants , and desires are still real. Living in poverty for 20 years when you are old is no better than living in poverty when you are young! Our plan is to spend down assets over the next 20 years, but we have zero debt, a plan to maximize Social Security, and some longevity annuities. Oh and yes we have a reverse mortgage, which is actually LOW risk if the balance is “zero’ which ours is, which then makes it a growing line of credit for emergencies only. We still should have a bit of our portfolio at 85 with our spend down plan, if we don’t we will just take less trips.
It was worth watching this just to see the part starting at 8:50 The way you got so upset was both amusing🤑and a testament to your passion about saving and investing. Basically, I agreed with everything you said.
My father had this attitude to die with zero. I found it to be a very selfish attitude. He left nothing for his wife which life is difficult now for her. I paid for his funeral which was an expense that was unwanted when I was grieving.
That's not at all what the book recommends, though. Nothing in the book says "screw other people, spend all your money on yourself". Quite the opposite - it talks a lot about providing for your spouse and kids while you're alive, and while they're young enough to get the most out of it.
This is one of your most refreshing videos, taking on an ideology that goes completely opposite of your own, yet coming away with some useful advice. Seems the hedonistic apologist author of that book ignored the most basic concept of money management - that nobody can predict future expenses! If you don’t have a reliable safety net, how much extra is too much? Nobody ever knows! Only fools pretend to know the future.
This book really resonated with me. The author is quick to say on the first page they are not a certified financial planner and that someone struggling to make ends meet may not get the same value from the book. When it comes to one of your sticking points with the book regarding possibly taking on debt for experiences... I agree with the context as he framed it and him adding the disclaimer to his statements: - "And just to be clear: When I say it makes sense to borrow money when you're young, I'm not saying you should be racking up credit card debt, such high-interest loans are a bad idea for almost anyone. Borrow modestly and responsibly." Throughout the book, the author advocates for balance in life when it comes to saving and spending. If you're doing the responsible things by budgeting, saving & investing at a young age... though find yourself short when a once in a lifetime trip with a friend comes up, what are you going to do? DOOR #1: "Sorry I can't go... all my money is tied up for my 65 year old self", or... DOOR #2: "hold the phone... I'm going to get creative, be responsible with some debt temporarily... but I'm going to do what I can do make this happen". That sounds in line with the author's advice of 'borrow modestly and responsibly'. The example he provided of a friend/colleague taking time away from work, taking on some temporary debt to go on a European vacation was a good one that follows the same train of thought. Don't light money on fire continually for experiences - but for a one-time event in your younger days while you have lots of earning power ahead of you, it can be a good trade that will make you 'richer' for making that choice, just as it did for his colleague.
If you die with a million in your bank account, you are giving your children additional life. You are only wasting your life if you don’t think giving your children a better life is more important than your own joy.
Love the “money is a tool” quote. My wife and I are very young and 25-26 and we are planning on saving and investing super heavily over the next 5 years and when we turn 30 we are going to quit our jobs to go hike the PCT. 2650 from Mexico to Canada. I could not be more excited
Don't be afraid to do it in segments at various points in your life. Think of it as a celebration for various goals you have set. It will keep you primed and excited for the next phase.
I disagree that adult children cannot benefit receiving their inheritance in their 50’s and 60’s. Many people haven’t saved enough for retirement or still have a mortgage or are putting their children through college. The inheritance can help a great deal.
Our culture is too focused on the individual life. Imagine compounding wealth over generations! The wealth I build I intend to be piled on top the wealth my children build to change the trajectory of my family tree. How about future generations being able to help more people than I can within my life with my limited resource?
Love your rant and "I need to take a minute" reaction to that most outrageous advice. I would have burnt that book. There is a statistic that shows wealthy people are more likely to live past 90 and continue to have life experiences till they die without worrying that their health bills becoming a debt to their children. That means I have a choice between experiences now or a long life of experiences. Yes, I do believe in taking time out from work to enjoy life and I have done so several times, spending only money that I have in excess of emergency funds and absolutely no mortgage. The concept that I can enjoy spending borrowed funds is too hard for me to grasp. I am happy to help my family and friends... to some extent. I get real angry when I help pay for my nephew's college, only to find that my sister's family bought themselves a new Mercedes on a auto loan .... especially when I make sensible choices in life, like buying a brand new VW sedan all cash. In the end, what did all my nephews and nieces learn from this? Beg or borrow from that cheap aunt who has lots of money. If we continue to be so "generous", we are responsible for breeding that kind of thinking.
I can't burn the book it was a library book - I would have had to pay for it if I did that 😂 Teaching money lessons to kids is such a. hard area to navigate. Especially when you have money. It's easy to say no, we don't have the money - well maybe easy isn't the word, but easily understood. On the the other had, how do you say no, when you are perfectly capable of affording it? Hw do you teach them. that we are saying no because this is not in alignment with our values, it's not a need, or the intent is to teach you delayed gratification. How do you teach kids to have that hunger to make something of themselves, to save for a rainy day, to build wealth on their own, when they clearly see that you have already made it - and they feel some sense of entitlement to what you have? I think these are incredibly difficult things to pass on - and they become very real issues to consider when parents are quite successful.
I hear you on the relatives who want to borrow. I always think to myself am I willing to gift this money to them without expectation of repayment? We had one cousin just straight up ask us for $5,000. We asked what for? To put some racing brakes and some other equipment on a car they already couldn’t afford. Hard conversation, but we didn’t give them the money. A year later the car was repossessed due to missed payments. This is a person still living with his parents at age 29. Sigh.
@@stephenwright133 Here is how I think I want to handle that one. Just pay it forward, but only once. Here is how it works; I loan money to Joe. Then when Frank wants to borrow money I tell him "sure thing, Joe has your money and you can collect it from from him."
Great summary - but part of what you are missing is people do physically and mentally peak at 30ish. After this peoples health declines and then they die. I'm 60 and when I look at this video I think of my 2 friends who died of cancer last year. The one who has a brian tumor and will never work or travel again.
Hi Erin, I love watching your videos. And I agree 100% with you on the idea of going into debt is a terrible idea. And I like the fact that your changing up where your filming your videos. It’s nice to see a different background scenery every now and then. Keep up the great work! I know you do a lot to prepare for your videos so I wanted to say thank you soo much for your hard work You are awesome! 😊
Thanks Mark!! I finally bought a camera 😂 Up to this point all my videos had been filmed on my iPhone! This is the first one that I shot on the new camera - makes me feel a little fancy pants 😂
@@ErinTalksMoney Erin, you did a great job filming with your new camera 😊 I don’t know if you do or not, but would it be possible to get an autographed picture of you?
Okay i agree with the book. If you wait till you are dead to give money you are selfish zero debate. You dont have a choice it has to go somewhere. Ive been listening to erin. Probably 10 videos of hers. I dont agree some things in this book. But ive been saving crazy no. Its boring and easy. Over spending my money was fun, challenging and i pushed my body, my mind to the fullest. But id rather be mike tyson than a warren buffet. Id rather be marylin menroe than oprah winfry. Erin you rocked it at the end thats why you are married and living your life.
Makes perfect sense to me. I don't live to make money, I make money to live. Unless I have plans for the money upon death, I could care less what is left.
As I think about retiring in the next 2-3 years at around age 62 I think the best approach is to delay social security until 70, put about 10% of your money into an annuity to supplement that guaranteed income of social security (since you don't now how long you have to live) and spend the rest of your retirement $$ down and enjoy you healthy retirement years, which for most people is their 60's. The advice most financial advisors give to only spend 4% of your retirement each year (to protect the principal) is simply ridiculous in my book. I also know so many people that stay in their job until 65 because of their employer sponsored health care. Thanks to Obamacare, it is now easier than ever to get private health insurance. I am not going to work from 62 to 65 just for a health care premium. Those are prime retirement years to enjoy yourself.
Save what you need to retire with enough money, but don't save more than that. Calculate your annual expense, adjust for inflation, and make a monthly saving target. Spend the rest of it on improving quality of life.
There is a theory in economics that people spend out of their "permanent income", meaning the rational amount that you will earn across your lifetime. It's why we have mortgages, car loans, and student loans. In a lot of instances, it makes sense. However, when the "rent" on the time value of money exceeds your actual income growth rate, you're gonna have a bad time.
That theory has some major holes though, the biggest one being compound interest. $1,000 invested now could turn into $10,000 or even $100,000 in the future. And the opposite effect when you owe money can be even worse, due to the insane interest rates on credit cards and some loans. So someone might only earn $2 million from work over their lifetime, but bring in another $5 million from investments, most of which will come from money they invested in their early years.
Another great video Erin! Also a good juxtaposition to your just got a mortgage video. I pretty much agree with your entire take on this book. Thanks again for a well thought out, rational perspective. And as a Michigander, thanks for promoting “Up North” with you tee!
The author is making a fundamental mistake by equating spending money with happiness. I agree with the basic premise that experiences in life are worth more than your bank account. However, you can still have great experiences without spending all your money. Money also provides a sense of well being that you can handle any difficulty or hardship that life throws at you. This author seems to want people to live in the moment exclusively and ignore the potentially catastrophic consequences.
I don't believe that's the author's intent. The intent is to die with $0. Hence you used all your money up by your last day. Hence you should optimize your life. Unless you are leaving the money to a loved one, we can agree that leaving the money to uncle Sam isn't what you worked all your life for.
Die with zero is tricky because we don't actually know when our expiration date is. How do we know when we will run out of time or run of money? I also struggle with FOMO/YOLO vs saving for the future. That $1000 vacation trip now could be worth $10,000 in 10 years invested.
If your goal was to die broke and you make it to say over 70 you could put all your money into a single premium immediate annuity. Once you're over 70 the mortality credits make this a half decent choice but I wouldn't put all my money into it, but if your goal is to die broke you could
I joke with my kids about spending my last nickel to pay the backhoe operator who throws the last bit of dirt onto my grave. Mostly to just inspire them to save and not count on anything coming to them. I do think “savers” need to be reminded to spend sometimes. My mom was a saver and died early, never getting to use the $ she saved. I am a saver too, but am just now shifting my thoughts to spending. My kids are just about out of the house and mortgage just about gone. Now it is time to start spending before my health declines too far to fully enjoy.
@@elmateo77 ummm… no that is not at all what I said. First off I said it was a joke, and 2nd off my Dad was still alive and got $ when my mom died. 3rd I used the $ I did get to adopt my 2 children. But you can go on jumping to conclusions about my life and finances.
@@loborocket, I also joke with my kids like that, it's hard when they have grown up with no money issues, I grew up in a family that had little and I just naturally wanted my kids to have everything. But as they got to High school I made it clear they need to get good grades and get to College if they wanted any chance at the same life they were used to. So far so good. Sorry about your Mom.
My brother subscribes to this approach. But he won't be able to do it. He and his wife, DINKs, have made much more money than they spend. They are in their 70s and have travelled the world. Not much more for them to spend on in their remaining years.
I'm mid -thirties and most days I still feel like I'm twenty - so, so far so good! I remember having my 30th birthday with a former employer, and he told me, well your 30, it's all down hill from here! 😂
We need to keep in mind that it's possible that we may leave this world without achieving all our life's goals. When you achieve one goal, you'll want another. We want to keep ourselves constantly motivated. When we wake up in the morning, what keeps us going is there is a goal ahead. I don't think none of us would ever reach a point where we feel we have done everything we have wanted. And even if did feel it, we wouldn't be thrilled. Who wants to live even one day where there is nothing to be done?
Beatthebush channel has a good take on this book, a couple things I remember: 1) this is impossible, since no one knows when they’ll die, and 2) author doesn’t practice what he preaches.
Absolutely not. Peace of mind is worth a great deal to me. In particular, the peace of mind of knowing I'm unlikely to ever run out of money. I would get far more anxiety from trying to cut it close to the bone, than joy from spending that extra money. From this review, it sounds as though the author may be totally discounting this. As for the argument that you get more joy out of passing along unneeded wealth before you die than after? There's something to that, which is why I donate to charity in my working years at all. But there _is_ such a thing as anticipatory joy and pleasure from knowing I _will_ be giving someone a gift - even if I will not be around to get the thank-you note, as it were. And I think the author may be totally discounting this as well.
Dear Mom and Dad. Please don't Die with $0. Yes, I want you to enjoy your money. But I don't have $15,000 per month to pay for your needed assisted care.
Here is a person who has never visited a government run retirement home.... Next time ur off on a holiday.. go find such an establishment in the country you are visiting..... what you see is coming to your country in your lifetime.
Well, that was fun...Thx, sorry after 64 years I'm a saver. Call me whatever you want after I'm gone. And I feel giving the kids a bunch of money in their 30s does nothing but build laziness, but I did pay off all their college debt. Now they need to figure it out on their own,
Nice honest review. I agree, it's stupid to just assume you're going to be rich down the road so mortgage your future today... That's a sure way to be not successful.
Absolutely! You always hope that there are brighter days ahead - or that your income grows - but life holds no guarantees - and I'm not about to finance my future.
Back in the late '90s there was a similar book called "Die Broke" by Stephen Pollan and Mark Levine. Similar idea, but dated somewhat now. I'm older, and I know a number of people my age who are in a real bind because they didn't plan for being retired and/or unable to work. They woke up and realized Social Security wasn't going to be enough. It's not fun. I managed to plan ahead, and right now I have a comfortable lifestyle. However, one major illness could change that. I don't have long-term care insurance--I never could afford it, and at my age now, I can't get it for any kind of reasonable price. The author says you're going to end up on Medicaid anyway, but I hope he realizes exactly what that means. He should visit a mostly-Medicaid nursing home sometime--a few hours there might change his mind. I'm fortunate that I can save money for "eventualities" as well as for things I enjoy.
Yeah, but it seems so self-discouraging though. You work hard and save and live a financially responsible life only to end up (possibly) seeing every bit of your hard work and your legacy get handed over to the medical / industrial complex in the last 24 - 36 months of your life, just so, as Chris Rock famously put it, "at least you'll die on a mattress!"
Completely agree. My grandmother had a stroke and spent the last 8 years of her life in a nursing home. Having money to augment government insurance was the difference between having a room by herself in a quality home vs spending the last 8 years with random stranger roommates who would die and then be replaced...
I remember speaking to my Dad weeks before he passed away. He felt so guilty because he went on a little vacation and spent $10,000. I told him he should do that more often. His kids are doing just fine on their own. We don't need anything you might leave us. I told him to please enjoy it and don't feel guilty at all. He earned it and should enjoy it in his retirement.
You hit the nail on the head Erin. Debt is very stressful. And it is slavery. "The borrower is the slave to the lender." Live within your means.
Watching Erin read the quote: "Say it. Say it Erin." Erin ... does not disappoint.
Now, I'm 63 years old and retired. I have this piece of advice for any and everyone. Want to control your stress? Keep your finances under control. Want to be happy? Pay off your credit cards, pay off your home, pay off your auto loans. Your stress level will fall and your happiness will increase. I've seen too many people living on the edge of their financial resources. Then times get tough. They lose a job and can't find a job. They lose the house with a mortgage, second mortgage and third mortgage. They used that money for boats or RVs or motorcycles. Bankruptcy ensues. The marriage is stressed or broken. Forced into retirement and they are forced to live on next to nothing and if a health crisis happens, everything else can be gone as well. Yes, enjoy your life .... but save your money.
Amen! 🙏
Nailed it! I'm 61 and just marked 5 years of retirement, same behavior as you!
You nailed it Gary
When all debts (including the house) is paid off..then and only then you can afford to be generous
Be careful on giving $ to Charities..my own mum that lived near RI gave 200k to Jamaican Scam Artists..what a waste!
Another thing is to have income streams..NOT PENSIONS..when you die all pensions stop..if you have income streams
your kids will get your income streams
Borrowing is evil..paying with cash is sacred...this comes from Pastor Dave Ramsay who worships at the altar of Financial Independence
Can i get an amen?
Good advice!! I have one more thing to add. Be very careful about how you interact financially with people that hold this kind of philosophy. Once they have exhausted their resources their only choice will be to turn to you.... I speak from experience.
“You’ll own nothing, and you’ll die happy”!
Coming from a 57 y/o old to the young crowd... 1) Save 10% in your 401K and no more. Rest 20%-30%-40% of your income in a brokerage A/C and into Dividend growth ETFs. This way if you choose to retire early, you can easily do it with the earning/dividends from your brokerage A/C. No need to bust your ass till 65 if you want to retire early! 401K is only good but for a very long time horizon! 2) Geo arbitrage to a LCOL country and buy private insurance until you reach Medicare age!
thank you!
I agree with all of the main points from the book. Super savers can take their health for granted, and life is about balance. I'm personally not fulfilled by budgeting, saving, and investing. I'm fulfilled when getting to my financial goals allows me to have experiences with the people I care about. Money is a trust-based currency to get goods and services with, not a goal in and of itself.
Very true! (and I still stand by if can be really hard to nudge super savers into spending - speaking as a super saver - but it's just as important to spend on things you enjoy) You sound like you have a really great balance! 😊
I'm a super saver because I grew up poor. I lived with a man who was never there for me. I feel that money gives you independence and freedom.
I could agree that saving money without a purpose is a waste.
Totally agree with you about the “going in debt” part for experiences.. it’s absolutely ridiculous …..I read it too and thought that if a young person read this and followed this a lot might be broke all their lives.. and to be honest when you are in debt you won’t be enjoying life coz you are constantly stressed everyday……
For us, super savers, the book must dwell on the shelf in front of our eyes ..(After reading the book , being 65, I certainly aimed for new targets....no regrets and not looking back)
For me and my wife it served as an eye opener.
I definitely agree with the remarks you mentioned.
Thank you, and please summarize more up to date personal finance books.
Aaron, you are wise beyond your years. I've only recently started looking at my life in these terms, looking at giving away my wealth to my airs now so that I can enjoy seeing the fruits of my labor. Being a part of first homes, weddings and graduations that I've helped along the way will bring me more joy and anything I purchased for myself.
Watching you glean ideas that compliment and and some that are extremely contrarian to your beliefs is enlightening. Glad to see you take away so much from one book.
My wife and I are 64, in our eighth year of retirement. We saved more than most at our income level but I wouldn’t call us super savers. As we think about memories, the best memories are the great vacations we had and the time we spent with our loved ones. I also think about the possibility of outliving our money, which is unlikely but nevertheless on my mind a lot. No, I don’t want to die with zero because we can’t predict our death very well. But I do encourage everyone live the day-to-day below your means so you can have great experiences throughout your lives. The balance is hard to hit but trying to live a balanced life with a good job, good savings and great experiences along the way is my advice for a worthwhile and fulfilling goal.
Good morning, keep up the good work, I still can't get over your financial story about being completely debt free and feeling so good about owning a home. You're doing a great job with your channel!
Thanks Bob - I'll be debt free again as some point!
This one really spoke to me.
It is important to find life experiences that make you happy but don’t cost a lot of money. We have a tendency to equate high dollar things with things that make us happy.
Im learning how to spend more, after saving all these years. It's not easy to change a habit, specially when you feel guilty spending. My first full time Job after leaving school, as a teenager back in the early 80's paid me AU$2.60 an hour. That was a hard drudgery working in a factory, back then. Now life is so easy.
Kinda like u've seen the sun rise in your life.
Difficult to just change gears and start spending. Especially when everything is paid off, you have all the household goods you need, cars, etc. What do you spend it on - just eat out and travel more ? That gets old after a few years. But we are trying to do more fun things and the trick that helped was taking a weekly "allowance." I chose $500/week. I hit the bank machine for cash and will use that to puck up a lunch tab/etc. when out with friends. If I don't spend it, I keep track in a spreadsheet and save up for large purchases - we have upgraded flights to first class a few times which was nice on those 8-10 hour flights. That has helped us, but as we get older we just want less so we are gifting more to young relatives and charities. Whatever works - good luck mate !
Had an economic professor in under grad. He said his daughter asked him since he was an economic professor, he was going to leave her a lot of money right? He told her, no, since I'm an economic professor, my plan is to spend my last penny as I take my last breath, you're on your own kid.
ouch! lol I always liked Warren Buffett's advice, leave your kid enough to so something, but not so much that they do nothing
@@ErinTalksMoneyI think you get them launched and give them the tools to be fiscally responsible, after that…. When I was 20 and finishing college my mom said I’m selling the house and you have three months to find a place to live. Best thing that ever happened to me. I got myself together quickly and never looked back.
I read this book too... I'm a saver so I expected to read some contrary opinions. He makes some really good points on the value of experiences and some of the trade offs involved. However I think he underestimates how miserable people are when broke, how much having wealth gives you options, and the value of never going broke.
the author is assuming that working is a waste of time but I think most times it can give our life some meaning. Just ask retirees. I retired at 42 and I am 50 now. Although I hated my job at the time it did give me some purpose everyday, I enjoyed talking to co-workers, I took advantage of weekends. As a retired person, sometimes the only person I talk to in a day is my kid. Yes, I travel, but even that gets old.
Erin: I’ve always wondered about this book. Haven’t bought it yet. Your insightful, challenging, nuanced personal take on this book 📕 and it’s assertions is exceptional! In this age of lazy, regurative, black and white thinking, this video and your channel as a whole are a true breath of fresh air!
🙏
With a younger wife who is not financially focused I am working to keeping things simple, which also mean leaving much more than Zero.
Erin you are fantastic! I can't recall a book summary better than this. So informative and clear. I love it. You did a great job. And I learnt something today. Thanks.
Your getting better and better every video. You are clearly getting more comfortable and sound much more conversational than when you started. All I can say is way to go! Big,big thumbs up!
I appreciate that!!! Thank you!! 😊
One can learn from many sources. You don't have to agree with every word but as someone who is planning to retire early a lot of the concepts of this book sound spot on IMHO. Of course, don't blow it all on one night in Vegas but your life is precious and it should be enjoyed to the fullest. I know too many people who died prematurely and never really enjoyed their life and money. That, happens more than you think.
The book makes some excellent points and some terrible ones. It is clearly written by an extremely wealthy person who is removed from the realities of the middle class. The good points are: 1. prioritize experiences, 2) enjoy your life as much as possible while you are able-bodied enough to do so, and 3) help your children financially when they are young (as long as they are hard working and will put the money to positive use). The bad points outweigh the good ones, however. They are 1) Spend money now because spending money is the only way to enjoy experiences (false), 2) spend more than you earn, 3) estimate your likely longevity and plan to spend your money down ...this is easier said than done and assumes you'll not eventually be a $300k per year long-term care burden on your children. The greatest anxiety you can face in your golden years is .....running out of money.
Hi Erin! Life is all about balance. You can’t be such a tightwad that you never spend and you save, save, save. On the other hand you need to be wise and save for the future and take care of your family and others where possible. I think your sentiments were right on with this book. Good to see that you are repping your alma mater! I think of freezing cold though when I think of Northern Michigan! Have a great week Erin!
I loved northern Michigan - coldest weather I have ever experienced was -45 🥶 🥶 🥶 (PS, I don't like the cold....but Michigan is beautiful ...in the summer 😂 )
@@rafaelw8115 Whatever buddy
Erin, my parents are currently working through Roth conversion- so that my brother and I don’t pay it in taxes. I told them exactly this, LAST WEEK, spend it all- enjoy your money, you set us up so we (hopefully) won’t need it.
Also me: checking my spreadsheet to see how much money my kids will inherit, based on conservative assumptions, after my wife and I pass away at any age from retirement to 120.
I love your passion!!!
I have that same attitude - to my parents, you worked hard, you enjoy what you have saved for a lifetime. Then I would want to turn around and save it up when I eventually have a kid to pass it on to them to make their life easier 😂😂
I'm doing the exact same for my daughter so take it from me, they are doing everything they want to do in life and don't want to see their hard earned money going to Uncle Sam when you only have ten years to pay the taxes. Likely, it will be on top of your working income and put you in a high tax bracket. It makes them feel good, empowered even. Hope that puts it in perspective for you.
Love how lively you are in this videooooo
I loved the book. The graphs/triangles in the book are great visuals to help folks understand that many activity windows close and guard against over frugality at the expense of missed life experience opportunities. The story of the trader that took the trip to Europe when in his mid 20's is a great example of maximizing an experience that is age sensitive on the level of joy the experience can create. Wholistically, I agree with the message of the book and as an early retiree, it is so hard to open the spigot and spend after a lifetime of savings. Continued compounding above your expense burn only means your estate will grow at the expense of missed opportunities aka using the tool of money to create lifelong memories for yourselves or your offspring that continue to pay dividends.
Keep posting the great content!!
I hear you - experiences truly do pay a different kind of dividend, a valuable memory dividend! The book had a lot of great points! (I just cannot wrap my head around, "spend more than you earn.")
Great video! I'm a saver and I enjoy your content. Life is a balance with money , always be prepared for a rainy day. Live your life the way that makes you happy!
Well said!
Life is about balance. We have spent on experiences that we will remember for a lifetime and have also saved for the rainy day or the time when we don't have to work if we choose not to. For us it has been about buying what we need and occasionally splurging on experiences that we want. Did we buy the biggest house we could? No, we bought what we needed because we knew we wanted to have enough left over to go on vacations, save for the future, and be there for the ones we love. Do we buy new vehicles every few years? No, we haven't had a car payment in years because cars just don't mean that much to us other than to be reliable and get us from point A to point B.
Honestly, I get what the author of the book is saying, but I also cringe on parts of it. Yes, spend some today, take some risks when you are young, but also save for your future self as well. One of the gifts we are giving to our kids is that they don't have to worry about us as much as we age. We've got it covered.
I LOVE this!!! Thank you for sharing Stephen! 😊
love your take on the book.
Thanks!! 😊
I get the feeling that Mr. Bill Perkins is a little out of touch with the lower and middle class of America. He is the son of a professional football player, went to a 'preparatory school', and now is a hedge fund manager, and film producer.
The advice he is giving MAY be for those who already have some level of money to support their life style.
Can you see someone making $22,600.00 a year in this market buying a home, having children, and meeting all other financial requirements and still planning to go on a cruse to somewhere?
My feelings are that this book is written for the upper class who already have a firm financial basis.
I had that same thought. Professor Google estimates his net worth at $60,000,000 - so it is probably easy to make such bold statements when you are at that level of success.
Same applies to all these unrealistic headlines like " you should save this much by this age" or " you need this much to retire". It's all BS that's so far removed from the real world hardships of the average man/ woman.
First, it was smart to rent the book from a library. With that said, you do not know your needs when you grow old. It really depends on the kids you have, but many times giving your kids money is doing them a disservice if all they do is spend to "keep up with the Jones" or live beyond their means. It is extremely important for your kids to learn to live within their means while they are young.
It is not selfish to save money for your old age so that you do not become a burden on your kids. Nursing homes are extremely expensive. The alternative is letting your kids take care of you at home which is an extreme burden. I watched three daughters go on shifts to be with their parents in the home 24/7 to take care of them. After about 3 years, it got to the point that the parents had to go in a nursing home as it was beyond their ability to care for them. If it was not for the savings the parents had, the burden on the family would have been extreme. The children were very thankful that their parents had the money in savings during this time. With that stated, many (and maybe most) people may not go in a nursing home. However, you do not know which group you will fall in when you are old.
You were right to be outraged about living beyond your means and counting on future pay raises. You do not know if the pay raises will happen, and, if you will even have a job 1 year from now.
This book mixes some good advice with a lot of bad advice.
I really enjoyed your analysis and review of this book given that I have a very similar mindset/perspective as you do about money and time (as I'm sure many others watching do too). I've decided to borrow this book from my local library. I don't expect to agree with much of it, but given life is an endless pursuit of knowledge, one must lend an ear to the other side and take their preachings in equal measure if they wish to attain any sense of a whole understanding of something.
This book is definitely for financial fanatics to remeber life isnt about accumuluating money. But, if you live paycheck to paycheck or suffer from debt, not time to read this book
Erin, you may possibly be my spirit animal. When you went off on that quote I was up and yelling too!
Love your response in this video. Your passion around #5 was awesome, and I agree with you. I do agree with the author on generosity after death is no where near the same as generosity during life. The money has to go somewhere.
I don't plan to die with zero. I want to leave something to the kids that will make life comfortable, but not so much that it would impact the way they live! That "kids" money will also be our cusion for some catastophic event late in life, that could derail the retirement of a surviving spouse. As, nice shirt. NMU I would asume.
That sounds like a wonderful plan! (NMU for sure! 😊)
Anyone that has run a Monte Carlo simulation on their retirement savings should realize that in the VAST majority of successful retirement plan scenarios you will reach the end of life with FAR more money than you "need."
That's prudent. Not wasteful.
I have not read this book. Your summary and analysis are spot on. Well done.
If you haven't read the book, how do you know the summary is accurate?
Erin this author sounds like a young idealistic kid who comes from money, anyone who grows up poor doesn't think this way. You will do whatever it takes to never be poor again!
yep
Just because something is expensive doesn't mean it's going to add that $ amount of value to your life. I got a pretty good idea of what will add real value to my life, and I do spend money on the things that bring me enjoyment. Other than maybe some trips when I get a bit more money, I'm happy and always grateful for what I have in my life and feel like there's really not much else I need that I couldn't buy right now.
I actually agree with the author on giving when you’re alive. You’re making a sacrifice and taking on risks which is a generous effort. The intent is all there. When you’re dead you’re essentially leaving behind your leftovers. Technically it’s giving because it’s a gift, but the intent of giving isn’t really all there.
I like the fact that this book has many seemingly disparate pcs of advice. It shows that the author is open minded and understands that we're not all built the same with the same objectives and goals. It's important to remember that we don't all have to agree 100% of time. When it comes to advice, know yourself well enough to understand what advice you should take to heart and what you should ignore. Use what works for you and leave the rest.
@@rafaelw8115 shut up
You’re best video yet! I’m 50 and trying to save as much as I can for retirement.. My goal is to retire from my crappy ole job at 59-1/2 at the latest.. There’s a lot of happiness in having money in your account.. trying to spend it down to zero.. that would not be good for my health.. if I have money when I die.. I’m sure my wife will enjoy herself.. lol
Thank you for the kind words! Good luck on retiring by 59 1/2!!
I had planned to work to 60 as late as my 55th birthday. A year later, I could see my job stress was being misdirected at my wife. Not in an extreme way but she is such a great person, I knew she didn't deserve to have to live with a guy that seemed to be angry at the world . I decided I would retire 6 months later. I'm a planner and knew everything would work out. I didn't expect my retirement account would still have the same balance, five years later, with no Social Security. And I have been generous and doing what I want. You sound responsible so don't be surprised if you retire a few years earlier. You can always get a "fun" job to supplement.
Agreed debt is stressful
Without knowing how long you will live, it is difficult to do what the author suggests. Also, being frugal is a source of happiness for some people; the author shouldn't try to gaslight them into spending more money. The danger of this author's advice is how it would affect people with low income and low net worth. It would likely only lead to more spending for them when they should be doing the opposite. Regarding giving money to the young, many parents do save for college funds for their kids, and things of that nature.
Right, you never know when it's your time! (PS - clearly I love saving money!
it does bring me joy! 😂)
Good morning. I liked your video. I had a whole book written about my perspective on life as a response. I deleted it and changed to just good morning.
First off, good morning Bryan! And ...really?!?! Why delete your response??!! I would have loved to read it.
@@ErinTalksMoney Most folks don't like my view of life and the end of it. I do agree with you, you don't play on credit. When I raced I raced on my funds. When those funds dried up I quit racing. My friends that raced said they race on credit card and then paid them off in the winter. Nope, not for me. That makes no sense. I know for a fact that they never paid them off over the winter. All that interest paid on top of the general expense of racing.
Now I have used credit cards for other reasons. When my business went south I tried to keep it alive using my credit cards. I reduced my paycheck so I could keep it going. But in the end I wound up with about $45K worth of CC debt and another 10K to the IRS. Then the company folded. Was it worth it. Fiscally, no. I learned a lot though and from that perspective it was probably cheaper than college and more applicable. :-)
while watching this (great video) hubby asks what meal out will cost for upcoming birthday; told him; he points pair of shoes he wants instead! Get real, “you will get both!” We are OLD, buy what you want and yes we will eat steak at restaurant for your birthday!He’s too funny!
That's adorable!! Happy birthday! 🎂
What if you miscalculate your expiration date by 10, 20 years? You will do your kids a big disservice by now being financially dependent on them. Leaving my kids a huge inheritance is not my top priority but at least expect to keep our principle intact from date of retirement and that will be a nice windfall. I believe that is happy medium.
Seriously! If you miscalculate that's a HUGE issue!!!
Liked your criticism.
Personally, me and my wife spend on experiences but still keep on saving .(we are retired)
Excellent idea to introduce and discuss relevant books.
Agree! I’d like to see more of this
The comment about inheritance is very on point. We are in our early 60’s and our parents are in their 80’s. We don’t need any money from them. Makes more sense to go to the grandkids, or give it a lot earlier.
We want to die with zero also, but figuring out when you will die is impossible, even if you get very ill.
I’m a big believer in enjoying life along the way, BUT, money is not the only thing that matters.
Once you are old you realize that your needs, wants , and desires are still real. Living in poverty for 20 years when you are old is no better than living in poverty when you are young!
Our plan is to spend down assets over the next 20 years, but we have zero debt, a plan to maximize Social Security, and some longevity annuities. Oh and yes we have a reverse mortgage, which is actually LOW risk if the balance is “zero’ which ours is, which then makes it a growing line of credit for emergencies only. We still should have a bit of our portfolio at 85 with our spend down plan, if we don’t we will just take less trips.
Thanks for the great post today! Definitely food for thought.
Thanks for watching Enid!
It was worth watching this just to see the part starting at 8:50 The way you got so upset was both amusing🤑and a testament to your passion about saving and investing. Basically, I agreed with everything you said.
Agreed on the debt advice.
My father had this attitude to die with zero. I found it to be a very selfish attitude. He left nothing for his wife which life is difficult now for her. I paid for his funeral which was an expense that was unwanted when I was grieving.
That's a pretty f*** up thing to do I absolutely agree
That's not at all what the book recommends, though. Nothing in the book says "screw other people, spend all your money on yourself". Quite the opposite - it talks a lot about providing for your spouse and kids while you're alive, and while they're young enough to get the most out of it.
This is one of your most refreshing videos, taking on an ideology that goes completely opposite of your own, yet coming away with some useful advice.
Seems the hedonistic apologist author of that book ignored the most basic concept of money management - that nobody can predict future expenses! If you don’t have a reliable safety net, how much extra is too much? Nobody ever knows! Only fools pretend to know the future.
A great reminder to live for today but also plan for tomorrow. I love your prudent and sensible approach to saving and investing, Erin. :)
Thanks for watching!! 😊
This book really resonated with me. The author is quick to say on the first page they are not a certified financial planner and that someone struggling to make ends meet may not get the same value from the book. When it comes to one of your sticking points with the book regarding possibly taking on debt for experiences... I agree with the context as he framed it and him adding the disclaimer to his statements:
- "And just to be clear: When I say it makes sense to borrow money when you're young, I'm not saying you should be racking up credit card debt, such high-interest loans are a bad idea for almost anyone. Borrow modestly and responsibly."
Throughout the book, the author advocates for balance in life when it comes to saving and spending. If you're doing the responsible things by budgeting, saving & investing at a young age... though find yourself short when a once in a lifetime trip with a friend comes up, what are you going to do? DOOR #1: "Sorry I can't go... all my money is tied up for my 65 year old self", or... DOOR #2: "hold the phone... I'm going to get creative, be responsible with some debt temporarily... but I'm going to do what I can do make this happen". That sounds in line with the author's advice of 'borrow modestly and responsibly'. The example he provided of a friend/colleague taking time away from work, taking on some temporary debt to go on a European vacation was a good one that follows the same train of thought. Don't light money on fire continually for experiences - but for a one-time event in your younger days while you have lots of earning power ahead of you, it can be a good trade that will make you 'richer' for making that choice, just as it did for his colleague.
Love your perspective. Thanks so much. Sounds like a great book.
I agree with you!! We should not spent more than we earn. It means that we are broke! and in debt.
Ha! Epic rant (well deserved), and epic hair day!
haha! 😂
If you die with a million in your bank account, you are giving your children additional life. You are only wasting your life if you don’t think giving your children a better life is more important than your own joy.
Love the “money is a tool” quote.
My wife and I are very young and 25-26 and we are planning on saving and investing super heavily over the next 5 years and when we turn 30 we are going to quit our jobs to go hike the PCT.
2650 from Mexico to Canada. I could not be more excited
That sounds epic!!! Good luck!!
Don't be afraid to do it in segments at various points in your life. Think of it as a celebration for various goals you have set. It will keep you primed and excited for the next phase.
I disagree that adult children cannot benefit receiving their inheritance in their 50’s and 60’s. Many people haven’t saved enough for retirement or still have a mortgage or are putting their children through college. The inheritance can help a great deal.
Our culture is too focused on the individual life. Imagine compounding wealth over generations! The wealth I build I intend to be piled on top the wealth my children build to change the trajectory of my family tree. How about future generations being able to help more people than I can within my life with my limited resource?
Love your rant and "I need to take a minute" reaction to that most outrageous advice. I would have burnt that book.
There is a statistic that shows wealthy people are more likely to live past 90 and continue to have life experiences till they die without worrying that their health bills becoming a debt to their children. That means I have a choice between experiences now or a long life of experiences.
Yes, I do believe in taking time out from work to enjoy life and I have done so several times, spending only money that I have in excess of emergency funds and absolutely no mortgage. The concept that I can enjoy spending borrowed funds is too hard for me to grasp.
I am happy to help my family and friends... to some extent. I get real angry when I help pay for my nephew's college, only to find that my sister's family bought themselves a new Mercedes on a auto loan .... especially when I make sensible choices in life, like buying a brand new VW sedan all cash. In the end, what did all my nephews and nieces learn from this? Beg or borrow from that cheap aunt who has lots of money. If we continue to be so "generous", we are responsible for breeding that kind of thinking.
LOL. I loved the rant too and totally saw it coming. 🤣🤣
I can't burn the book it was a library book - I would have had to pay for it if I did that 😂
Teaching money lessons to kids is such a. hard area to navigate. Especially when you have money. It's easy to say no, we don't have the money - well maybe easy isn't the word, but easily understood. On the the other had, how do you say no, when you are perfectly capable of affording it? Hw do you teach them. that we are saying no because this is not in alignment with our values, it's not a need, or the intent is to teach you delayed gratification. How do you teach kids to have that hunger to make something of themselves, to save for a rainy day, to build wealth on their own, when they clearly see that you have already made it - and they feel some sense of entitlement to what you have? I think these are incredibly difficult things to pass on - and they become very real issues to consider when parents are quite successful.
I hear you on the relatives who want to borrow. I always think to myself am I willing to gift this money to them without expectation of repayment?
We had one cousin just straight up ask us for $5,000. We asked what for? To put some racing brakes and some other equipment on a car they already couldn’t afford. Hard conversation, but we didn’t give them the money. A year later the car was repossessed due to missed payments. This is a person still living with his parents at age 29. Sigh.
@@stephenwright133 Here is how I think I want to handle that one. Just pay it forward, but only once. Here is how it works; I loan money to Joe. Then when Frank wants to borrow money I tell him "sure thing, Joe has your money and you can collect it from from him."
08:53 LMAO!!!!! That was awesome!
Great summary - but part of what you are missing is people do physically and mentally peak at 30ish. After this peoples health declines and then they die. I'm 60 and when I look at this video I think of my 2 friends who died of cancer last year. The one who has a brian tumor and will never work or travel again.
Hi Erin, I love watching your videos. And I agree 100% with you on the idea of going into debt is a terrible idea. And I like the fact that your changing up where your filming your videos. It’s nice to see a different background scenery every now and then. Keep up the great work! I know you do a lot to prepare for your videos so I wanted to say thank you soo much for your hard work You are awesome! 😊
Thanks Mark!! I finally bought a camera 😂 Up to this point all my videos had been filmed on my iPhone! This is the first one that I shot on the new camera - makes me feel a little fancy pants 😂
@@ErinTalksMoney Erin, you did a great job filming with your new camera 😊 I don’t know if you do or not, but would it be possible to get an autographed picture of you?
Okay i agree with the book. If you wait till you are dead to give money you are selfish zero debate. You dont have a choice it has to go somewhere. Ive been listening to erin. Probably 10 videos of hers. I dont agree some things in this book. But ive been saving crazy no. Its boring and easy. Over spending my money was fun, challenging and i pushed my body, my mind to the fullest. But id rather be mike tyson than a warren buffet. Id rather be marylin menroe than oprah winfry. Erin you rocked it at the end thats why you are married and living your life.
Makes perfect sense to me. I don't live to make money, I make money to live. Unless I have plans for the money upon death, I could care less what is left.
As I think about retiring in the next 2-3 years at around age 62 I think the best approach is to delay social security until 70, put about 10% of your money into an annuity to supplement that guaranteed income of social security (since you don't now how long you have to live) and spend the rest of your retirement $$ down and enjoy you healthy retirement years, which for most people is their 60's. The advice most financial advisors give to only spend 4% of your retirement each year (to protect the principal) is simply ridiculous in my book. I also know so many people that stay in their job until 65 because of their employer sponsored health care. Thanks to Obamacare, it is now easier than ever to get private health insurance. I am not going to work from 62 to 65 just for a health care premium. Those are prime retirement years to enjoy yourself.
Save what you need to retire with enough money, but don't save more than that. Calculate your annual expense, adjust for inflation, and make a monthly saving target. Spend the rest of it on improving quality of life.
Maybe throw in $100k for that unplanned medical event we never want.
Great job. Good to see the passion
Like Charlie Munger says, “tell me where I’m going to die and I won’t ever go there.” Same thing with “when.” No day is guaranteed.
There is a theory in economics that people spend out of their "permanent income", meaning the rational amount that you will earn across your lifetime. It's why we have mortgages, car loans, and student loans. In a lot of instances, it makes sense. However, when the "rent" on the time value of money exceeds your actual income growth rate, you're gonna have a bad time.
That theory has some major holes though, the biggest one being compound interest. $1,000 invested now could turn into $10,000 or even $100,000 in the future. And the opposite effect when you owe money can be even worse, due to the insane interest rates on credit cards and some loans. So someone might only earn $2 million from work over their lifetime, but bring in another $5 million from investments, most of which will come from money they invested in their early years.
Another great video Erin! Also a good juxtaposition to your just got a mortgage video. I pretty much agree with your entire take on this book. Thanks again for a well thought out, rational perspective. And as a Michigander, thanks for promoting “Up North” with you tee!
Thanks Mark! I will always be Michigan proud! ✋
The author is making a fundamental mistake by equating spending money with happiness. I agree with the basic premise that experiences in life are worth more than your bank account. However, you can still have great experiences without spending all your money. Money also provides a sense of well being that you can handle any difficulty or hardship that life throws at you. This author seems to want people to live in the moment exclusively and ignore the potentially catastrophic consequences.
That seems like a very accurate assessment. Spending money does not guarantee happiness, you are so right!!
I don't believe that's the author's intent. The intent is to die with $0. Hence you used all your money up by your last day. Hence you should optimize your life.
Unless you are leaving the money to a loved one, we can agree that leaving the money to uncle Sam isn't what you worked all your life for.
You need to read more than just the title before jumping to conclusions about what the author is saying.
If you annuitize your nest egg, you can get to $0 on death.
Well balanced review, thank you!
Die with zero is tricky because we don't actually know when our expiration date is. How do we know when we will run out of time or run of money? I also struggle with FOMO/YOLO vs saving for the future. That $1000 vacation trip now could be worth $10,000 in 10 years invested.
If your goal was to die broke and you make it to say over 70 you could put all your money into a single premium immediate annuity.
Once you're over 70 the mortality credits make this a half decent choice but I wouldn't put all my money into it, but if your goal is to die broke you could
Say yah to da UP, eh? Michigan Tech alumni here! :-D ... great video!
Really enjoyed this Erin ..
thank's for the French translate ^^ God bless you ^^
I joke with my kids about spending my last nickel to pay the backhoe operator who throws the last bit of dirt onto my grave. Mostly to just inspire them to save and not count on anything coming to them. I do think “savers” need to be reminded to spend sometimes. My mom was a saver and died early, never getting to use the $ she saved. I am a saver too, but am just now shifting my thoughts to spending. My kids are just about out of the house and mortgage just about gone. Now it is time to start spending before my health declines too far to fully enjoy.
So your mom left you a bunch of money, but you're planning to leave your kids nothing? Seems legit.
Happy spending!
@@elmateo77 ummm… no that is not at all what I said. First off I said it was a joke, and 2nd off my Dad was still alive and got $ when my mom died. 3rd I used the $ I did get to adopt my 2 children. But you can go on jumping to conclusions about my life and finances.
@@loborocket, I also joke with my kids like that, it's hard when they have grown up with no money issues, I grew up in a family that had little and I just naturally wanted my kids to have everything. But as they got to High school I made it clear they need to get good grades and get to College if they wanted any chance at the same life they were used to. So far so good. Sorry about your Mom.
My brother subscribes to this approach. But he won't be able to do it. He and his wife, DINKs, have made much more money than they spend. They are in their 70s and have travelled the world. Not much more for them to spend on in their remaining years.
Late 20’s 🤪😜, I think entering my mid 40s was rough! Save, save and save so you can live well in retirement.
I'm mid -thirties and most days I still feel like I'm twenty - so, so far so good! I remember having my 30th birthday with a former employer, and he told me, well your 30, it's all down hill from here! 😂
@@ErinTalksMoney OMG, that's EXACTLYwhat my wife told me on my 30th!!! Excuse me, ex-wife.
We need to keep in mind that it's possible that we may leave this world without achieving all our life's goals. When you achieve one goal, you'll want another. We want to keep ourselves constantly motivated. When we wake up in the morning, what keeps us going is there is a goal ahead. I don't think none of us would ever reach a point where we feel we have done everything we have wanted. And even if did feel it, we wouldn't be thrilled. Who wants to live even one day where there is nothing to be done?
I too am very conflicted with this concept
6:52 The money can go to a family trust that’s usually the default. Not a charity.
Beatthebush channel has a good take on this book, a couple things I remember: 1) this is impossible, since no one knows when they’ll die, and 2) author doesn’t practice what he preaches.
why do you say that? Is it because of his net worth?
❤ ❤❤ thank you. Erin
Absolutely not.
Peace of mind is worth a great deal to me. In particular, the peace of mind of knowing I'm unlikely to ever run out of money. I would get far more anxiety from trying to cut it close to the bone, than joy from spending that extra money. From this review, it sounds as though the author may be totally discounting this.
As for the argument that you get more joy out of passing along unneeded wealth before you die than after? There's something to that, which is why I donate to charity in my working years at all. But there _is_ such a thing as anticipatory joy and pleasure from knowing I _will_ be giving someone a gift - even if I will not be around to get the thank-you note, as it were. And I think the author may be totally discounting this as well.
Dear Mom and Dad. Please don't Die with $0. Yes, I want you to enjoy your money. But I don't have $15,000 per month to pay for your needed assisted care.
Here is a person who has never visited a government run retirement home....
Next time ur off on a holiday.. go find such an establishment in the country you are visiting..... what you see is coming to your country in your lifetime.
As with all books take the good ideas and apply them to your life; and reject the rest.
Yes, that's how I approach books as well!!
That is how I do it, but some might read it and end up with debt when they can least deal with it. Kind of scarry.
I enjoy spending money on investments. The best thing you can buy with money is financial security.
Well, that was fun...Thx, sorry after 64 years I'm a saver. Call me whatever you want after I'm gone. And I feel giving the kids a bunch of money in their 30s does nothing but build laziness, but I did pay off all their college debt. Now they need to figure it out on their own,
hahaha! Fair! (I think helping your kids though college is a HUGE deal!!!)
I am taking my money to the grave!!! Great video Erin!
Thanks Silvia!
Nice honest review. I agree, it's stupid to just assume you're going to be rich down the road so mortgage your future today... That's a sure way to be not successful.
Yep. However fast you think your career and income will grow, it's pretty likely the compounding 20% interest on that credit card will grow faster...
Absolutely! You always hope that there are brighter days ahead - or that your income grows - but life holds no guarantees - and I'm not about to finance my future.
Back in the late '90s there was a similar book called "Die Broke" by Stephen Pollan and Mark Levine. Similar idea, but dated somewhat now.
I'm older, and I know a number of people my age who are in a real bind because they didn't plan for being retired and/or unable to work. They woke up and realized Social Security wasn't going to be enough. It's not fun.
I managed to plan ahead, and right now I have a comfortable lifestyle. However, one major illness could change that. I don't have long-term care insurance--I never could afford it, and at my age now, I can't get it for any kind of reasonable price. The author says you're going to end up on Medicaid anyway, but I hope he realizes exactly what that means. He should visit a mostly-Medicaid nursing home sometime--a few hours there might change his mind. I'm fortunate that I can save money for "eventualities" as well as for things I enjoy.
My thoughts exactly! No one dreams of heading to a medicaid facility. (And no one regrets saving a little extra)
Yeah, but it seems so self-discouraging though. You work hard and save and live a financially responsible life only to end up (possibly) seeing every bit of your hard work and your legacy get handed over to the medical / industrial complex in the last 24 - 36 months of your life, just so, as Chris Rock famously put it, "at least you'll die on a mattress!"
Completely agree. My grandmother had a stroke and spent the last 8 years of her life in a nursing home. Having money to augment government insurance was the difference between having a room by herself in a quality home vs spending the last 8 years with random stranger roommates who would die and then be replaced...
@@irefusetoaskmydoctorifyour6401 But that's what my money is for---for paying for my care when I need it.