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February 12, 2024

Avoid one ‘dumb’ money mistake now, with Dave Ramsey’s guidance

Dave Ramsey, bestselling author and radio host, is warning about the myths and misinformation surrounding retirement planning. He believes that relying on Social Security alone is unrealistic, as the average monthly income from Social Security is only $1,657, barely enough to cover basic living expenses. Ramsey also points out that without Congressional action, Social Security benefits may be cut in 2033. He emphasizes that individuals are responsible for their own retirement security and should not depend on the government.

Another myth Ramsey addresses is the belief that investing up to the 401(k) match is enough to build a solid retirement nest egg. He recommends investing at least 15% of one’s income into retirement and going beyond the match. Ramsey also cautions against the idea of working during retirement, as data shows that only 27% of retirees actually end up working. He advises individuals to set themselves up for a comfortable retirement without relying on a job for income.

When it comes to healthcare costs during retirement, Ramsey highlights the limitations of Medicare. While it can provide coverage for certain medical expenses, it does not cover deductibles, copays, or long-term care. Individuals should be prepared to cover these costs themselves.

In conclusion, Ramsey emphasizes that it’s never too late to start saving for retirement and encourages individuals to take control of their financial future. By understanding the realities and avoiding common myths, individuals can create a more secure retirement plan.