I can’t tell you how many times a client has sat across from me and said, usually with a smile, “Hey Glenn, my goal is to have my last check bounce.”
I always laugh. But I also understand what they’re saying.
They’ve worked hard, saved their money, raised their families, and paid their bills. Now they want to enjoy what they’ve earned. They don’t necessarily want to leave a fortune behind. They want to travel, spend time with family, and maybe buy a few things they’ve always wanted.
And I think there’s something to be said for that.
There’s even a name for this idea. It’s called “Die with Zero,” a philosophy made popular by Bill Perkins in his book of the same name.
The idea is simple: Rather than spend your entire life saving money you may never use, why not enjoy more of it while you’re still here?
It’s an interesting way to think about retirement. But as an estate planning and elder law attorney, I would add one important warning.
It’s a great idea to enjoy your money. It’s not such a great idea to run out of it.
Why This Matters
One of the things I’ve noticed over the years is that people can be very good at saving money and surprisingly bad at spending it.
For 40 or 50 years, they’ve been told to save for retirement. Then retirement arrives, and suddenly they’re supposed to start spending those savings.
That’s not always easy.
Some people worry so much about running out of money that they never really enjoy what they’ve worked for.
Others go in the opposite direction. They figure they’ve earned it, so why not spend it?
The trick is finding a comfortable place somewhere in the middle.
You Can’t Take It With You, But You Might Need It Longer Than You Think
Here’s where my experience as an elder law attorney comes into play.
People are living longer. That’s generally a good thing. But living longer can also be expensive.
A healthy 70-year-old may have many years of retirement ahead. And while those years might include vacations, golf, and time with grandchildren, they could also include medical problems, home care, assisted living, or nursing home care.
Long-term care can cost thousands of dollars every month. And Medicare generally doesn’t pay for ongoing custodial care, which is the help people need with everyday activities like bathing, dressing, and eating.
I’ve seen families surprised by just how quickly those costs can eat into a lifetime of savings.
That’s why I tell clients that the goal shouldn’t really be to die with zero.
The goal should be to enjoy your money without having to worry about whether you’ll have enough later.
After all, it’s pretty hard to arrange for that last check to bounce when you don’t know when you’re going to write it.
Sometimes Giving Money Away Early Makes More Sense
There’s another part of this philosophy that I really like.
Many parents plan to leave their children an inheritance someday. But think about when that inheritance might arrive.
If you live to 95, your children might be in their 60s or 70s when they inherit your money.
By then, they may have already paid off their homes, raised their children, and retired themselves.
Would some of that money have helped them more when they were 35 and struggling to buy their first home?
Or when they were 40 and trying to pay for their children’s education?
For families who can afford it, helping children or grandchildren during their lifetime can be a wonderful thing.
You get to see the difference your gift makes. And sometimes, that’s worth more than leaving a larger inheritance.
Of course, there are things to consider before making large gifts. Gifts can affect taxes, Medicaid eligibility, and your own financial security. That’s especially important in Michigan, where Medicaid has rules about giving away assets before applying for long-term care benefits.
So while giving early can make sense, it should be part of a thoughtful plan.
Don’t Forget to Spend Money on Memories
I also think there’s something important about spending money at the right time in your life.
That trip you’ve always wanted to take? It might be easier at 65 than at 85.
The family vacation with all the children and grandchildren? There may never be a perfect time, but there may be a time when everyone can still enjoy it together.
And sometimes the best use of money isn’t another investment or a bigger bank account.
It’s renting that cottage for a week, taking the grandchildren somewhere special, or simply enjoying an experience with the people you love.
I often remind clients that an estate plan isn’t just about what happens when they die. It’s also about protecting their independence and helping them enjoy life while they’re here.
Simple Lesson
Don’t be so busy saving for tomorrow that you forget to enjoy today.
But don’t spend so freely today that you put tomorrow at risk.
Good estate planning and financial planning should help you do both: enjoy the life you’ve worked for and protect yourself if life takes an unexpected turn.
Action Step
If you’re retired or getting close to retirement, consider sitting down with your financial advisor and reviewing three things:
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How much money do you need to comfortably support yourself for the rest of your life?
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Have you planned for the possibility of expensive long-term care?
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Once those needs are covered, could you afford to spend or give away more money while you’re alive?
You might be surprised by the answers.
And if your goal is still to have your last check bounce, I understand.
Just make sure it’s the check written for your funeral, and not the one paying for your groceries ten years earlier.
If you’d like to talk about your estate plan or long-term care planning, we’re always happy to help. Call us at (517) 548-7400 or reach out here: https://www.michiganestateplans.com/contact-us
