Estate And Retirement Planning Lessons From The Late Tony Hsieh

Tony Hsieh was known as an innovative and unconventional leader during his time as an early investor in and longtime leader of online shoe retailer Zappos. He was apparently worth hundreds of millions of dollars at his death. Hsieh might also become well-known for key mistakes he made in his retirement and estate planning.

The tech entrepreneur died from injuries sustained in a house fire in Connecticut while visiting friends in November. Since his death, stories have been published alleging that Hsieh had problems with drug and alcohol abuse, especially during his last year. Apparently, he was in Connecticut preparing to enter a rehabilitation facility.

While Hsieh’s is an extreme case, his difficulty adjusting to retirement isn’t unusual, especially for someone who was a very busy high-level performer during his career. Hsieh retired from Zappos in August. Reports are that he was a heavy partier throughout his career, and the drug and alcohol use increased during retirement. Other allegations are that during retirement a life long fascination with fire increased and he experimented with extreme diets and others challenges to his physical endurance.

Hsieh’s retirement life also included a move to a new city. A result of the move, coupled with the Covid-19 pandemic, is that Hsieh became isolated from long-time friends and associates.

Though I write and advise primarily about retirement finances, I frequently state that financial security is only part of a successful retirement. Too many people don’t plan for how they will spend their time in retirement. They have to fill the time they used to spend working and commuting. They also need a structure for their days, weeks, and months to replace the structure they had during their careers.

Replacing the social contacts and interaction of the workplace also are important to successful retirement. Numerous studies conclude that friendship and social interaction are important to maintaining both physical and mental health. Other studies show that many retirees become isolated, lacking enough contact with friends and family.


Hsieh apparently was one of the many retirees who didn’t develop a plan for how he would spend time during retirement. He also moved away from longtime friends and family, requiring him to develop new contacts. The reports are that his new contacts largely took advantage of him and encouraged his worst instincts.

As Hsieh demonstrated, financial security doesn’t guarantee a successful retirement. The non-financial aspects of retirement are at least as important and must be planned as thoroughly as retirement finances.

There also are lessons to be learned from what we know about Hsieh’s estate.

If Hsieh had a will, none of his family or associates is aware of it or where it might be located. Everyone should have a will, but especially someone with a valuable and complicated estate. Even when a person has a will, it doesn’t have much value if others aren’t aware of it and where it can be located.

By not having a will, Hsieh left doubt as to who should serve as executor of his estate. In July, a cousin was granted power of attorney for Hsieh, according to news reports. The cousin petitioned a court to be named guardian of Hsieh and his estate after he was injured in the fire. But in December a Las Vegas judge appointed Hsieh’s father and brother to act as special administrators and representatives of the estate. It’s possible there will be court battles in the future regarding who should be in charge of the estate.

Hsieh also apparently did what everyone should avoid. He left a mess for his family to clean up. The Wall Street Journal described walls in his mansion that were covered with color-coded sticky notes representing financial commitments Hsieh made to employees, friends, and local businesses. There’s also some question as to whether Hsieh was in sound mental state during his last months and had the legal capacity to make binding contracts. Now, the administrators of his estate must sort through these and determine what they mean and whether the terms are legally enforceable against the estate.

That’s not the extent of the mess. Hsieh acquired numerous interests in local real estate and businesses, much of it purchased recently, owned through perhaps dozens of limited-liability companies. There apparently are numerous projects in various stages of development, and there’s some question about the extent of charitable commitments Hsieh made in both Las Vegas, Nev. and Park City, Utah.

Hsieh didn’t leave a master list or inventory of his assets and liabilities. Everyone should create and update such a list. The inventory makes it easier to develop your estate plan and, more importantly, gives the estate administrator a guide to settling the estate. Since Hsieh didn’t leave an inventory of his estate, his administrators will spend months and perhaps years simply identifying the assets and liabilities. In addition, some of the assets are likely to lose value in the time it takes for the estate to determine they are part of the estate and begin managing them.

I’ve often said the best gift a person can leave heirs is a guide to the estate. The guide would be a document or computer file that fully identifies all financial accounts and other assets, including where to locate important documents and how to access the accounts. These days, an inventory of access information for all online accounts, subscriptions, and other electronic assets and liabilities is essential. This type of roadmap for the estate administrators is almost as important as an up-to-date will.

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