26-04-2025
Why Dave Ramsey Thinks Social Security Is a ‘Mess' — And What You Can Do About It
With Social Security facing serious challenges, Dave Ramsey is sounding the alarm.
In a recent blog post on Ramsey Solutions, the personal finance expert didn't hold back, calling the system a 'mess' and urging Americans to take their retirement planning into their own hands. With growing uncertainty around the program's long-term stability, many are left wondering what role Social Security will realistically play in their future.
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Here's why Ramsey believes Social Security is falling short and what experts say you can do to stay ahead.
Social Security was never meant to fully fund retirement. It was designed as a supplement, not a safety net you can live off entirely. But according to a survey conducted by The Senior Citizens League, 27% of seniors have only Social Security benefits as income.
The Social Security Trustees Report projects that the combined Old-Age and Survivors Insurance (OASI) and Disability Insurance (DI) trust funds to be depleted in 2035. If nothing changes, this could result in a 17% benefit cut in 2035.
Ramsey pointed to this looming shortfall as just one sign that the system is in trouble. He argued that the imbalance between the number of workers paying into the system and the number of retirees drawing from it is unsustainable. With people living longer and fewer workers supporting more retirees, the math doesn't add up.
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Given these challenges, Ramsey advises individuals to take personal responsibility for their financial futures. He recommends building retirement savings through consistent investing and not relying solely on Social Security.
Robert R. Johnson, Ph.D., CFA, CAIA, professor of finance at Heider College of Business at Creighton University, doesn't agree with everything Ramsey recommends, but agrees on the importance of building retirement savings.
'Planning so that Social Security benefits can be considered the 'dessert' of your retirement spending is very prudent,' Johnson said. 'One certainly wants to err on the side of accumulating more wealth than less when it comes to your retirement nest egg.'
To avoid over-relying on Social Security, here are some strategies to consider.
'The earlier you start saving for retirement, the more time your money has to grow through compound interest,' said Jake Falcon, founder and CEO at Falcon Wealth Advisors.
He suggested contributing regularly to tax-advantaged retirement accounts, such as 401(k) plans, IRAs or Roth IRAs, as well as a health savings account (HSA), which can be used for medical expenses.
Take advantage of employer matching contributions to your retirement plan.
'This is essentially free money that can significantly boost your savings,' Falcon explained. 'I can't stress this enough: If your employer offers a benefit this lucrative, you almost can't afford not to take it.'
A diversified investment portfolio can help you better manage risk and provide more stable returns over time.
'Consider a mix of stocks, bonds, real estate and other assets to mitigate risk,' Falcon explained. 'Most importantly, you want to make sure your investments are lined up with your financial plan.'
Consider adding additional sources of income, such as rental properties, dividends from investments or part-time work in retirement.
'Many retirees are still earning some sort of wage. It can be a great to stay active, as well,' Falcon added.
Healthcare costs can be a significant expense in retirement.
'Consider what your plan for long-term care is and leverage health savings accounts to cover potential medical costs,' Falcon said.
'Life circumstances and financial markets change, so it's important to review your retirement plan regularly and make adjustments as needed,' Falcon explained. 'I would not make adjustments based on market fluctuations — instead, adjust your plan when your life changes.'
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This article originally appeared on Why Dave Ramsey Thinks Social Security Is a 'Mess' — And What You Can Do About It
