1 Optimize Your Life Rule No. 1: Maximize your positive life experiences. In October of 2008, Erin and her husband, John, were successful lawyers with three young children when they learned that John had clear-cell sarcoma, a rare and rapidly growing cancer of the body''s soft tissues. "Nobody thought that a healthy 35-year-old would have a tumor the size of a baseball," Erin recalls. So no one suspected cancer until the tumor had spread to John''s back and leg bones. "We didn''t understand how serious his condition was until he had an X-ray and it was lit up like a Christmas tree," Erin says. The grim diagnosis terrified and overwhelmed her. And with John too sick to work, the full burden of taking care of the family physically and financially fell to her.

It was too much for one person to bear. I had been friends with Erin since we were kids, so I wanted to do everything I could to make the situation less horrible. "Stop what you''re doing," I told her, "and spend time as a family while John still can." I also offered to help with the costs. It turns out I was preaching to the choir: Erin had already been thinking about quitting work to focus on what really mattered. And that''s what she did. So at their home in Iowa, between John''s cancer treatments, the couple enjoyed the simple pleasures of each other''s company: They''d go to the park, watch movies, play video games, and pick their kids up after school together. In November, when local doctors had done everything they could, without success, Erin found a clinical trial in Boston, where she and John made several trips to undergo the experimental treatment, using their free time to go on some of the city''s historic tours while John could still walk.

All too soon, though, their hope faded, and one day John broke down at the thought of everything he''d miss, from watching his children grow up to passing the years with Erin. John died in January of 2009, just three months after his diagnosis. Looking back at that period, Erin recalls the trauma and devastation, but she is glad she quit her job to be home with John. Most people would have done the same in these circumstances. Death wakes people up, and the closer it gets, the more awake and aware we become. When the end is near, we suddenly start thinking, What the hell am I doing? Why did I wait this long? Until then, most of us go through life as if we had all the time in the world. Some of that behavior is rational. It would be foolish to live every day as if it were your last: You wouldn''t bother to work, or study for a test, or visit the dentist.

So it makes sense to delay gratification to some extent, because that pays off in the long run. But the sad truth is that too many people delay gratification for too long, or indefinitely. They put off what they want to do until it''s too late, saving money for experiences they will never enjoy. Living as if your life were infinite is the opposite of taking the long view: It''s terribly shortsighted. Clearly, the story of Erin and John is an extreme case. Advanced clear-cell sarcoma is rare, and death was staring this couple in the face much more starkly than it does for most people. Yet the challenge that their situation presented is common to everyone: Everyone''s health generally declines with time, and sooner or later we all die, so the question we all must answer is how to make the most of our finite time on earth. Put that way, it sounds like a lofty, philosophical question--but that''s not how I see it.

I''m trained as an engineer and made my fortune on the strength of my analytical skills, so I see this question as an optimization problem: how to maximize fulfillment while minimizing waste. Everyone''s Problem We all face some version of this question. Of course, the dollar amounts differ from person to person, often dramatically, but the core question is the same for all of us: What''s the best way to allocate our life energy before we die? I have thought about this question for many years, going back to when I was barely earning enough to live on, and over time I''ve come up with several guiding principles that make sense. These are the ideas behind this book. For example, some experiences can be enjoyed only at certain times: Most people can''t go water-skiing in their nineties. Another principle: Although we all have at least the potential to make more money in the future, we can never go back and recapture time that is now gone. So it makes no sense to let opportunities pass us by for fear of squandering our money. Squandering our lives should be a much greater worry.

I''m a big believer in these ideas, and I preach them whenever I get the chance. Whether it''s a 25-year-old afraid of pursuing her dream career and instead settling for a safe but soul-crushing job, or a 60-year-old multimillionaire who keeps working long hours in order to sock away more money for retirement instead of enjoying the great wealth he''s already accrued, I hate seeing people wasting their resources and putting off living life fully now--and I tell them so. As much as I possibly can, I also practice what I preach. Granted, sometimes I''m like a fat football coach on the sidelines, failing to follow my own advice. But when I catch myself doing that, I make corrections, some of which you''ll read about later in this book. None of us are perfect, but I do my best to walk the talk. We Are All Alike, We Are All Different Living life fully takes many forms. For example, I love to travel and I love poker, so I take lots of trips, some of them to play in poker tournaments.

This means I spend a big percentage of my savings each year on travel and on poker. But don''t get me wrong: I am not an advocate for everyone spending their savings on travel, let alone poker. What I am an advocate for is deciding what makes you happy and then converting your money into the experiences you choose. Those enjoyable experiences naturally vary from person to person; some people are active and adventurous, others prefer to stay close to home. Some get great satisfaction from splurging on themselves and their families and friends, while others prefer to spend their time and money on those less fortunate than themselves. And, of course, we can enjoy a mix of experiences. As much as I love to travel, I also like to spend my time and money to advance causes I care about, from railing against bank bailouts to bringing in hurricane relief to my neighbors on the U.S.

Virgin Islands. So I''m certainly not trying to tell you that one set of experiences is better than another; instead, you should choose your experiences deliberately and purposefully rather than living life on autopilot, as too many of us do. Of course, it''s more complicated than just knowing what makes you happy and spending your money on those experiences at every moment. That''s because our ability to enjoy different kinds of experiences changes throughout our lifetimes. Think about it: If your parents took you along on a tour of Italy when you were a toddler, how much did you get out of that expensive vacation, besides maybe a lifelong love of gelato? Or consider the other extreme: How much do you think you''ll enjoy climbing Rome''s Spanish Steps when you''re in your nineties--assuming you''ll still be alive and able to climb them at all by then? As the title of one economics journal article put it, "What Good Is Wealth Without Health?" In other words, to get the most out of your time and money, timing matters. So to increase your overall lifetime fulfillment, it''s important to have each experience at the right age. And that''s true no matter what you enjoy or how much money you have. So while the magnitude of everyone''s lifetime fulfillment will differ--for example, people with relatively little discretionary income tend to have lower fulfillment levels, and naturally happy people tend to have higher fulfillment levels--we all need to time our experiences properly.

Maximizing your fulfillment from experiences--by planning how you will spend your time and money to achieve the biggest peaks you can with the resources you have--is how you maximize your life. By taking charge of these crucial decisions, you take charge of your life. The Honorary Billionaire Some of my friends call me an "honorary billionaire," which means exactly what you think it does: I''m not actually a billionaire, but I spend like one. The reality is, though, that most billionaires won''t spend their fortunes during their lifetimes. There''s a limit to how much a person can spend on themselves, even with the most lavish tastes, so the ultrawealthy tend to give a lot of money away. Nonetheless, collectively, the 2,000 richest American households (most of them elderly) donate just 1 percent of their total wealth each year, a rate at which they can''t possibly use up their vast resources before they die. I''m not talking just about the stingy ultrarich. The richest households also include today''s most generous philanthropists--people like Bill Gates, Warren Buffett, and Michael Bloomberg, all of whom have pledged to give their fortunes away.

Yet even these extraordinary donors have trouble spending their billions fast enough. That''s partly because they''ve amassed so much wealth that their money is growing more each year than they''re able to give away in a thoughtful, responsible way. Gates, for example, has seen his.