Episode summary
The Long View: David Bach - ‘Start Enjoying Your Life Sooner’
The Long View
· · Hosts: Ben Johnson, Christine Benz, Amy Arnott · Guests: David Bach
Summary
David Bach argues that financial planning should be about using money to buy more life, not just accumulating assets. He says his move to Florence in 2019 was driven by a wake-up call from a cancer-stricken couple who urged him to “start enjoying your life sooner,” and he sees sabbaticals as a practical way to recharge before burnout shortens both careers and lives. He also says health expectancy matters more than many investors realize, warning that people often overestimate how long they will stay healthy and underestimate the need to spend while they can.
Bach’s central retirement message is that many affluent savers are too frugal to spend their own money. He says clients with large IRA balances often delay withdrawals to avoid taxes, so he proposes a temporary flat tax on retirement-account distributions after age 60 to encourage spending, boost GDP, and pull forward tax revenue. He argues the retirement industry has focused almost entirely on accumulation and has not done enough to help people decumulate.
He also updates The Automatic Millionaire for the app era, emphasizing that automatic investing is easier than ever and should start early. For young workers, he recommends saving aggressively through workplace plans, and for later starters he says the path is to save more, spend less, and lean on homeownership and home equity as major drivers of household wealth.
Key takeaways
- Bach says sabbaticals every 5 to 10 years can prevent burnout and help people work longer, not shorter, careers.
- He argues health expectancy is more important than retirement math because money is useless if investors are not healthy enough to enjoy it.
- Bach proposes a flat 10%, 12%, or 15% tax on IRA withdrawals after age 60 for an eight-year window to encourage spending and stimulate the economy.
- He says many retirees are over-saving and under-spending, especially in large IRA accounts that can keep compounding until required minimum distributions.
- For younger workers, Bach says saving 14% of gross income in a 401(k), plus an employer match, can put them on a path to millionaire status in about 27 years.
Notable quotes
“start enjoying your life sooner”
“what most people need in their life is more life”
“your health matters so much more than your money”
“The purpose of financial planning is not just dying with the largest account”
“You can't live inside a mutual fund”
How the episode opens
Please stay tuned for important disclosure information at the conclusion of this episode. Hi and welcome to the long view. I'm Christine Benz, director of personal finance and retirement planning for Morning Star.
And I'm Amy Arnot, portfolio strategist with Morning Star. Our guest on the podcast today is David Bach. David is the author of 12 national best-selling books, including The Latte Factor, Smart Women Finish Rich, Start Late, Finish Rich, and The Automatic Millionaire.
He just released a 20th anniversary edition of The Automatic Millionaire. David was a longtime contributor to NBC's Today Show and a featured guest on the Oprah Winfrey Show. He also produced and hosted two public television specials, Smart Women Finish Rich and The Automatic Millionaire.
David started his career at Morgan Stanley where he was a senior vice president and partner of the Bach group. David, thank you so much for being here on the Long View. Christine, it's truly my pleasure.
It's great to be with you again.
Well, it's great to have you. So, we have a ton of questions about work and your advice on personal finance. But before we get into that, we want to talk a little bit about your life because you made a decision in 2019 to move your family to Florence, Italy.
That was precoid, pre people doing dramatic things like that. So maybe talk about that impetus to move overseas and you've stayed much longer than you initially thought you might.
That's all true. I'm laughing because we've been here now seven seven years. You know, the impetus was interesting. I was a co-founder. I guess technically still am a co-founder. I'm a co-founder of a registered investment adviser called AE Wealth Management. And at the time after we got this business really kind of rocking and rolling all over the country, I was going around the country doing talks for my clients for our clients and our clients clients.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- sabbaticals
- health vs money
- ira withdrawals tax
- long-term deficits
- inflation and retirement
Watch the episode
Watch “The Long View: David Bach - ‘Start Enjoying Your Life Sooner’” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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The Long View, this episode and its artwork belong to Morningstar, Christine Benz - Director of Personal Finance and Retirement Planning, Ben Johnson - Head of Client Solutions, Amy Arnott - Portfolio Strategist. Octagon is not affiliated with the show; this page is an independent summary.
