Long-Term Saving and Spending Tips: Plan for the Future

This article is an excerpt from the Shortform book guide to "Die With Zero" by Bill Perkins. Shortform has the world's best summaries and analyses of books you should be reading.

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Looking for some long-term saving and spending tips? How can you better understand your spending patterns to plan for the future?

If you find that you struggle to save money or plan for your future expenses, then it’s important to learn about your spending patterns to plan a secure financial future. To help you make the most of your money, Bill Perkins offers a long-term saving and spending strategy in his book Die With Zero.

Read on to learn about Perkins’s saving and spending strategy for planning a secure financial future.

Plan Your Long-Term Saving and Spending Strategy

In Die With Zero, Bill Perkins advises you to spend all your money before you die—he argues that this is the best way to live a fulfilling life, ensuring you’ve spent every penny to its fullest. He claims the best way to do this is to create a plan for how and when you’ll be saving and spending over the long term. While Perkins advises you to not forgo valuable experiences in your youth, he doesn’t advise you to spend recklessly throughout your entire life. Instead, you should spend the first part of your life saving more than you spend and the second part of your life spending more than you save. 

How to Create a Precise Plan

The best way to precisely plan your saving and spending trajectory would be to know exactly when you’re going to die and then plan backward so that you’ll have spent all your money by then. Since this isn’t possible, Perkins suggests making an educated guess about when you’ll die and then planning your spending and savings based on your results. He suggests using the Actuaries Longevity Illustrator or the Life Expectancy Calculator to estimate how long you can expect to live and how long your money will need to last. 

Once you have a rough idea of when you’ll likely die, you can determine when it’s ‘safe’ to start spending more than you’re saving. For instance, you’ll want to start spending more earlier if you think you’ll live to 70 than if you expect to live to 95. 

(Shortform note: Creating a spending trajectory may seem like a sensible idea in theory, but implementing it might be more complicated. For one thing, there are unforeseeable circumstances—like global pandemics—that can throw a wrench into spending plans. The pandemic not only brought global tourism to a virtual standstill, but it also led to significant job losses. So if you were planning on spending money on travel or accumulating wealth during the pandemic, you may well have found yourself needing to rechart your spending trajectory. And on a more somber note, the pandemic led to a massive loss of life, particularly in the aging population, which may have rendered some peoples’ life expectancy calculations moot.)

Since we all have different patterns of saving and spending, life expectancies, health challenges, and desired experiences, the precise time to start spending more than you save will be different for each person. So, too, is the amount of money each of us would need to meet our basic expenses and maintain our standard of living should we stop bringing in additional funds. Therefore, Perkins devised the Spend Curve App, which can be found on the book’s website. This app personalizes his advice to help you figure out how to balance your saving and spending throughout your adult life. 

(Shortform note: Another consideration to take into account when determining at what point to spend more than you save is your possible desire to downsize in retirement. Many retirees choose to move to a smaller home to eliminate the hassle and expense of keeping up a large house. However, downsizing can sometimes cost a lot up front: Some homeowners must invest in costly renovations to make their houses marketable while others might have to rent while they search for their next home. If you’re thinking of downsizing, research what you might have to spend up front and use that figure in the Spend Curve app or your own calculations.)

While everyone’s spending trajectory will be different, Perkins adds that for most people, it makes sense to build your net worth up to the age of 45 to 60. By this age, you may have reached your highest-yet earnings at work, saved for retirement, acquired assets, and, especially by age 60, you won’t be too far from being able to collect social security and Medicare (if you live in the United States). 

(Shortform note: People who are currently under 55 may indeed reach their highest earnings at work and save for retirement in the age frame Perkins mentions, but it may be the case that those people won’t enjoy the same social security benefits that current middle-aged people do. J.L. Collins argues that by the time the large Baby Boomer generation has fully retired, there won’t be enough money to fund social security in the same way for subsequent generations. This means benefits will be smaller and will cost you more.)

Additionally, any money you’ve invested up to this point will continue to earn interest and further contribute to your funds as you age. At this point, Perkins suggests you start saving less and spending more to get the most meaning from your earnings before you die.

Perkins acknowledges that building your net worth up to age 45 may require making some spending sacrifices, and therefore, you may not get to have all the experiences you’d like during this period. His message is that you shouldn’t wait to invest in rich experiences that add meaning to your life, not that you should spend like there’s no tomorrow; balance is key.

(Shortform note: Perkins’s views on spending and saving stand in direct contrast to the—perhaps more common—view that the more money you have, the better off you are. People who believe this would likely continue saving past the age of 45, thereby sacrificing many fulfilling life experiences. But what makes such people value money so highly? Some believe that workers who receive performance bonuses develop an unhealthy obsession with accumulating money. Not knowing what the performance bonus will be or how it stacks up against colleagues’ bonuses leads people to think about them a lot, which in turn feeds into an unhealthy and unbalanced relationship with money.)

Exercise: Evaluate and Adjust Your Attitude Toward Saving and Spending

Reflect upon how well you currently balance saving money and spending money on meaningful life experiences. Consider if you might need to shift the balance toward either spending or saving.

  • Do you feel you currently balance saving money with enjoying fulfilling life experiences? Or do you feel you prioritize one over the other? Briefly describe your attitude toward saving and spending and note if you think this attitude is serving your overall happiness. 
  • What are some experiences you’d still like to have during your lifetime? Describe three and note at what age it would make the most sense to have each. 
  • Now, briefly consider how you might shift the balance of your current saving and spending patterns to enable you to have the experiences you noted. For instance, if you want to have a stronger network of friends right now, you might need to spend more money on social events. Conversely, if you currently spend a lot of money on social events but want to go back to graduate school in a few years, you might need to start saving more now. 
Long-Term Saving and Spending Tips: Plan for the Future

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Like what you just read? Read the rest of the world's best book summary and analysis of Bill Perkins's "Die With Zero" at Shortform.

Here's what you'll find in our full Die With Zero summary:

  • Why your goal in life should be to die with zero dollars in your bank account
  • Why you should use your money to the fullest, instead of saving it all
  • How to maximize enriching experiences throughout your life

Emily Kitazawa

Emily found her love of reading and writing at a young age, learning to enjoy these activities thanks to being taught them by her mom—Goodnight Moon will forever be a favorite. As a young adult, Emily graduated with her English degree, specializing in Creative Writing and TEFL (Teaching English as a Foreign Language), from the University of Central Florida. She later earned her master’s degree in Higher Education from Pennsylvania State University. Emily loves reading fiction, especially modern Japanese, historical, crime, and philosophical fiction. Her personal writing is inspired by observations of people and nature.

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