The Richest Person In The Graveyard

When most young men and women start out in the workplace, they typically start at the bottom.  The very bottom.  Scrubbing toilets, cleaning floors, and taking on the most tedious boring work.  They usually do the all the menial jobs that their more experienced elders wouldn’t touch with a 10-foot pole.

These junior workers are (of course) loaded down with student debt, and own very little in the way of assets.  This means they have little choice but to do the sh*t-work, and accept the “low-man on the totem pole” status.

Is there any hope?  Certainly!  Young workers can look forward to getting a raise or promotion.  One more dollar in the bank account.  One more monthly paycheck to pay down that student debt.  One more year of “experience” to add to the resume.

All in the hope that some day life will get better.  This desire to “get ahead”, or to improve our life is pervasive in modern culture.  We all desire to keep improving, and keep “adding to the pile”.  All in the hope that we never fall back down to the bottom rungs of life.

Most people manage to advance up the ladder of life a little — Once student debts are paid-off, life becomes more about improvement.  A better car, a bigger house, nicer furniture, or even a larger retirement account.

Some people take this quest of improvement so seriously they literally never take vacations.  They work 12 hour days in complete dedication to their work, and then literally die at the office…

Will You Die At The Office?

This is no joke.  I’ve literally seen a co-worker hauled off on a gurney — after suffering a fatal heart-attack.  He died on the job, and likely never spent any of the retirement dollars he invariably saved in his workplace 401k plan.

He was one of the proverbial “Richest Men In The Graveyard” — a person who worked extremely hard, saved for decades and then suddenly died… never actually getting a chance to spend a single penny of all that hard work.

That moment, watching the gurney get wheeled out the door, has stuck with me through the years.  At the time I was nothing but a low-level grunt worker in my 20’s, doing all the dirt-work.  But I remember it well.

I didn’t know the dead co-worker terribly well, but the incident reminded me of something really important —  We don’t live in the averages.  We all die on our own schedule.  Like it or not, we WILL die one day.

According to CDC, the average life expectancy in the United States is now 78.6 years old.  This number has continued to improve over decades of human history, and it will likely improve a little in the future (as medical science improves).

Remember though, life expectancy is merely an average.  An alarm doesn’t suddenly go off when you hit 78, and then you keel-over.  A large number of people will die considerably earlier than 78, and a few extremely rare individuals will manage to live into their 100’s.

An Early Demise

As I watched the paramedics roll the body into the ambulance that fateful day, I had two thoughts running through my head:

1. I needed to get back to work before my boss noticed I wasn’t working.  (Oops!)
2. There exists the distinct possibility that I might not live long enough to make it to a normal retirement age.

Life expectancy statistics from the CDC support this idea too.  Plenty of young people die in the United States before a “standard” retirement age of 65.

Even more interesting, the likelihood of dying more than doubles once you actually reach retirement age.

Live another decade and then the likelihood of dying doubles again.  The numbers just get worse from there…

This really made me wonder about the wisdom of working incredibly hard and saving up so much for a “standard age” retirement.  Dying early with all your money in 401k’s (and other retirement accounts) is a terrible injustice.  All of those hard-earned dollars might never see any real-world utility for the saver.

Yet the death-rate numbers don’t lie, it’s a distinct possibility you will die before you get to spend your savings.

Striking A Balance

Honestly, life is something of a gamble.  Each of us could die tomorrow, but many of us won’t.  We’ll continue to live for decades.

We have to plan for tomorrow, yet attempt to live for today too (within the constraints allowed by the modern workplace).  It’s not an easy task.

Some people take this eminent mortality as an excuse to live a life of excess, spending every dollar they earn (and more) — This is the exact opposite of the Richest Man In The Graveyard.  In other words — a total spend-thrift.  That strategy works for a while, but if the spend-thrift happens to live a long enough life, he or she will eventually suffer the consequences of those early excesses.

Debts eventually become due, and a lack of savings will eventually hurt.

My solution to this problem was to strike a balance between the two extremes.  I tried to find a middle ground in the “gray area”.  Live a little bit for today, save some for the decades before 65, and then save a little for the very long term (over 65).

So I did just that — I put around $500 a month into a “play money” account that I could spend with reckless abandon.  I enjoyed my life with that.  Then, I put a big chunk of my earnings into a taxable brokerage account.  Except I didn’t spend it.  I invested that after-tax money, and vowed to only spend the dividends on “living for today”.

(This taxable brokerage account would eventually become the money that allowed me to leave my job and declare financial independence.  Now, the dividends have grown to the point where I “live for today” every single day!)

And finally, I took advantage of pretax workplace retirement accounts (401k’s and IRA’s) that included employer matching.  This was my very long-term savings.  I took maximum advantage of employer matching, and I still haven’t touched those funds to this day.  Mrs. Tako and I will let these accounts grow until (if?) we reach age 65.

Final Mortal Thoughts

So far, I think my bizarre plan has worked out pretty well — I traveled quite a bit in my youth, and I also saved enough to leave work at age 38.  Now days, I mostly live off the dividends from my taxable accounts.  I’ve had a lot of fun, and it’s been a darn good life.

But what happens if I don’t die young?  If I happen to live past a “standard” retirement age of 65, then I’ve got my retirement accounts waiting in the wings, ready to go.  (These accounts will still have decades left to grow before Mrs. Tako and I ever need to touch them.)

This was the right balance for me.  For me, the real tragedy would be dying early, never having really *lived* at all.  Instead of paying my dues in an office, I want to live as much as possible while I was still young.  When I still had a little energy left.

I didn’t want to die the Richest Person In The Graveyard.  Do you?

[Image Credit: Flickr, CDC]