Forget about retiring, live rich and die broke

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Stephen Pollan’s revolutionary 1997 best seller “Die Broke” shook traditional retirement planning to its core with its audacious four-step mantra: “Quit today, pay cash, don’t retire and die broke.” Among the vest-and-wingtip crowd, Pollan might just as well have suggested, “Turn on, tune in, drop out.”

At a glance
Name: Stephen Pollan
Hometown: New York
Education: C.W. Post School of Business, Long Island University, B.S. Brooklyn Law School, New York, L.L.B.
Career highlights:
  • Best-selling author (with Mark Levine) of “Die Broke,” “Live Rich” and numerous other books on personal finance.
  • Television: Financial correspondent for NBC’s “Today” show, ABC’s “Good Morning, America,” CBS “This Morning”, PBS “Nightly Business Report” and Wall Street Journal Reports.
  • Print: Contributing editor, Personal Finance Magazine; columnist, Working Woman magazine.
  • Business: Practicing lawyer for 35 years; senior vice president of National Westminster Bank; CEO of an American Stock Exchange-listed closed-end investment company.
  • Teaching: Adjunct professor of Business Management at Marymount Manhattan College and C.W. Post University’s School of Business.
  • Consulting: Small business consultant to AT&T, Irving Trust Company, Commercial Credit Corporation (Prime America), Manufacturers Hanover Trust, Citibank, Intuit.
  • Member, Small Business Administration Advisory Council.

Ten years later however, “Die Broke” and its companion piece “Live Rich” have become virtual blueprints for baby boomers as they prepare to reinvent retirement. Many boomers have already left the corporate world to gain greater control of their career (quit today), freed themselves from debt (pay cash), and now plan to remain active (don’t retire) and safely transfer their assets to their heirs while they’re still around to enjoy the giving (die broke).

At 78, Pollan not only espouses the “Die Broke” philosophy, he lives it. He and his wife Corky remain active in their busy careers, they’ve transferred their property to their four children including actress Tracy Pollan (Mrs. Michael J. Fox) and author Michael Pollan (“The Omnivore’s Dilemma”) and still plan to bounce that final check to the undertaker.

Let’s talk about dying broke.

Dying broke has caught on. People were horrified when I came out with the concept of dying broke, because this was a time when many people were measured, oddly enough, by the size of their estates. If you left a lot of money, you had a good life. Today, if you die with too much, you’re considered a big schmuck.

At first blush, most people thought “Die Broke” was a manifesto of greed and selfishness.

Today, the belief is, you want to have your money maximize its productivity, which means if you’re going to be giving it, you’ll give it when it’s needed, not on the arbitrary date of death. If you’re thinking of your children, it’s when the child gets married, buys a home or starts a business. But when the baby boomer dies, those children are going to be 50-some odd years old; if those kids need the money, then something’s wrong with them. All you’re doing when you take money with you is giving orders from the grave. I think dying broke today has become more a part of our culture than ever before.

Financial planners today tell us that the biggest difference between baby boomers and their parents is that boomers are more concerned about outliving their money than about leaving a massive estate.

That’s right. That’s the biggest fear now. Which is why, incidentally, annuities are coming back into vogue. What better way to die broke than a charitable annuity or a clean, decent annuity where, even today, if you’re 75, you can get yourself an 8 percent yield, and sometimes a little bit more.

You were a voice in the wilderness when you championed the stodgy old annuity back in the roaring 90s.

Oh yeah. The only people who really enjoyed what I was saying were the older population in Florida who stopped going to the early bird. I’m serious. Look, money is not an icon, money is not a symbol; it’s a tool to do stuff with. The minute you die, it becomes useless as a tool. You want to enjoy life better? See the results of what your money does. You can’t hear “thanks” from the grave.

Are you surprised at the changes that “Die Broke” has brought about?

I’m sort of very proud now, sincerely, about “Die Broke” because it really came from the corner of one of my closets, and I’m glad that it’s accepted. I see so many senior businessmen giving out their money now. We are no longer measured at all by the size of our fortunes; it’s what we do with it.

You also rejected the notion of the actuarial dart toss where you guess a date of death and all retirement planning flows backward from that.

I never had much regard for the calendar. People should not be living their lives based on the calendar. The calendar is only good to ascertain how many candles you should have on your cake. Two things you should never do are live by the calendar and compare yourself against others.

You continue to hold with the one “Die Broke” tenet that puzzles some, which is, don’t retire.

Because leisure is lethal. My wife and I are both 78. Age is a matter of what’s between your ears. Most of age is created by attitude; I think attitude is a life-extender, exuberance is a life-extender. You know, you can talk yourself into death. Life is just so great that you should never make plans for anything else. The nicest thing about life, I’ve discovered, is to have somebody in your life that you would take a bullet for, and that’s what you have when you have kids. Then it’s all about love.

Here’s the $64,000 question. Are you going to die broke?

Yep. We’ve given all of our property away to our kids already and what we’re planning to do with our IRAs and defined benefit plans and all that is convert them into annuities based on two lives. The annuity can be immediate. If we bought a $2 million annuity now based on two lives, we would be collecting, starting next week, $175,000 a year. We hope to get the best yield possible, but the last check is going to be to the undertaker. And it’s going to bounce.

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