Retirement Retirement Planning

Ramsey's Blunt Warning About 401(k)s That People in Their 60s Don't Want to Hear

You need to read this if you want to retire soon.

By Catherine Collins , Edited by Laura Hohenstein

Updated Oct. 8, 2026

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If you're nearing retirement, Dave Ramsey has a message for you. Ramsey is a well-known financial expert, author of several New York Times bestselling books, and the founder of Ramsey Solutions. He is known for his no-nonsense, tough-love approach to personal finance, and he has helped millions of people become debt-free.

Ramsey has given advice on retirement planning for decades. Here is what he wants people to know about retirement, including those in their 60s who are ready to leave the workforce soon.

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Ramsey says a 401(k) is not enough on its own

Ramsey Solutions warns that investing only up to your employer's 401(k) match isn't enough. Many people in their 60s are resistant to hearing this because they've contributed to a 401(k) throughout their careers. But if they've only been putting in enough to get the match, they may have a noticeable gap.

Ramsey's rule is to invest 15% of your gross income for retirement. If your 401(k) offers a match, he recommends investing up to the match, then opening a Roth IRA for its tax benefits in retirement, then going back to your 401(k) if you still haven't reached 15%. Additionally, he recommends having a clear withdrawal strategy and understanding your 401(k) fees before retiring.

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Why people in their 60s shouldn't rely only on Social Security

Additionally, Ramsey says that those who don't have much saved in their 401(k)s should not rely solely on Social Security. Social Security's average monthly benefit is currently around $2,071. That amount, unfortunately, is barely above the poverty line for a two-person household.

On top of that, for those who want to retire in six to seven years, it's important to know that the Social Security Trustees project the OASI Trust Fund will be able to pay only about 78% of scheduled benefits once it's depleted in late 2032, unless the government passes policy changes to improve this outcome.

Ramsey recommends becoming debt-free before investing

One of Ramsey's more controversial teachings is that people should become debt-free before investing in their 401(k)s. He teaches something called the snowball method, which encourages people to pay off debt starting with the smallest balance and working up to the largest.

Only once consumer debt has been paid off and a full emergency fund is in place does he recommend investing 15% of income for retirement. While that may be challenging for people, especially those who want to retire soon, Ramsey says having fewer monthly expenses can help them allocate more toward retirement.

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The new catch-up contribution rules for workers in their 60s

If you feel like you're behind on your 401(k) contributions and you are between the ages of 60 and 63, there is good news.

Thanks to the SECURE 2.0 Act, people ages 60 to 63 can make super catch-up contributions. For 2026, workers 50 and older can contribute an extra $8,000 on top of the standard 401(k) limit. Workers ages 60 to 63 can contribute an extra $11,250 instead.

Ramsey also recommends investing in a Roth account

Although Ramsey provides a lot of advice about 401(k)s, he generally prefers Roth accounts, including Roth 401(k)s when they're available. The reason is that Roth 401(k)s and Roth IRAs are taxed now, but once you're in retirement, you can withdraw the money tax-free as long as you meet certain qualifications.

In addition to investing in Roth IRAs, Ramsey also recommends diversifying investments across four types of mutual funds: growth, growth and income, aggressive growth, and international.

Tips for transitioning into your retirement years

If you are in your 60s, here are some tips for transitioning into retirement. For many people, this change is exciting, but it can also be a challenge because you're going from a salaried income to a fixed income.

Many people often live on less in retirement than they did during their working years. A good way to prepare is to practice living on your retirement income for a few years prior to actually leaving work.

Additionally, Dave Ramsey recommends that people maintain an emergency fund to cover life's unexpected expenses. Having an emergency fund can prevent you from withdrawing too much from your 401(k) during your retirement years.

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Why people appreciate Ramsey's direct approach

Although Ramsey's approach has many critics, he also has a significant number of supporters who credit his seven baby steps system with helping them get out of debt and achieve financial freedom.

After all, when times are uncertain and prices are rising, many people appreciate having clear guidelines on how to become more financially secure.

Bottom line

Ultimately, Ramsey's goal for his listeners is a stress-free retirement one day.

To do that, he says people need to become debt-free, contribute to a 401(k) consistently, and start investing in other accounts, such as a Roth IRA, to create multiple income streams in retirement.

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