Dave Ramsey Sends Powerful Message On 401(k)s, Stocks

While confronting concerns over market fluctuations and the potential for a recession, many American workers are prioritizing the management of everyday financial obligations — covering mortgages or rents, keeping pace with soaring grocery prices, fuel costs, and other living expenses.

While focusing on these immediate challenges, they also focus on their future by investing in 401(k) plans and Individual Retirement Accounts (IRAs) to ensure financial security during retirement and to navigate the unpredictability of the economy.

Dave Ramsey, the personal finance author and radio host, offers compelling comments in an exclusive interview with TheStreet about saving for retirement, 401(k)s and building wealth in a volatile stock market. 

We will get to that below, but here's some important background first.

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Despite economic uncertainties, workers in the U.S. generally appreciate the value of retirement savings options like 401(k) plans and IRAs. These tools remain an essential part of their financial strategy, even during turbulent times.

Participating in a workplace-sponsored 401(k) plan continues to be a dependable way to build retirement savings, especially when employers provide matching contributions.

This system, with its automatic payroll deductions, ensures regular contributions with minimal effort, making it both practical and effective.

Related: Dave Ramsey bluntly warns Americans about Social Security

For 2025, the maximum contribution limit for 401(k) plans has increased to $23,500, compared to $23,000 in 2024. Workers aged 60 to 63 can take advantage of higher catch-up contribution limits of $11,250. People aged 50 to 59 have a limit of $7,500.

IRAs offer diverse investment opportunities that may not be accessible through 401(k) plans. However, IRAs require a greater level of involvement, as account holders must set up the account and arrange automatic contributions independently.

In 2025, the IRA contribution limit remains $7,000, with an additional $1,000 catch-up contribution available for people aged 50 and above.

Ramsey has some intriguing insights on markets and how they affect people's 401(k) plans an other investments.

Dave Ramsey speaks with TheStreet about personal finance issues. The personal finance author and radio host discusses 401(k) plans and retirement savings in a volatile stock market.

TheStreet

Dave Ramsey's powerful advice on 401(k) plans

Asked by TheStreet's Rebecca Mezistrano about market volatility, Ramsey offered advice he would give to people who are struggling with fear and uncertainty.

"Investing in the consumer realm for your 401(k) and for long term wealth building, the very word means have a long term time horizon, meaning the stock market," Ramsey said. "You and I know this because we watch it all the time. The stock market in a given week is a toddler throwing a temper fit."

More on retirement:

• Shark Tank's Kevin O'Leary sends strong message on 401(k)s, recession
• Dave Ramsey cautions U.S. workers about Social Security
• Jean Chatzky warns Americans on Social Security, retirement money

"The stock market over a decade is a wise old woman. And so she's wonderful long term," Ramsey added. "But you don't want to mess with her short term, so just zoom back. Chill, look at the long term. Nobody gets hurt on a roller coaster except those that jump off in the middle of the ride."

Related: Scott Galloway sends strong message on Social Security, boomers

Dave Ramsey comments on a 401(k) generational stock buying opportunity

Keeping in mind American workers' concerns about their investments and 401(k) plans, Mezistrano asked Ramsey about people who are calling the current condition of the stock market a generational buying opportunity.

"I don't know if it's a generational buying opportunity, but it's definitely a buying opportunity," Ramsey said. "Any time the blue light is on and the sale sign starts flashing, I get kind of excited." 

"And so when you have a long term view, like we were just talking about and you see a dip in the market, there's no other way to define that than it's on sale," Ramsey continued. "It's a buying opportunity."

Previously, Ramsey has suggested that Roth IRAs are his favorite way to invest, citing flexibility and the fact that one can withdraw money after five years up to one's contributions with no penalties. 

And once a person reaches 59-and-a-half years of age, they can make tax-free and penalty-free withdrawals.

Related: Veteran fund manager unveils eye-popping S&P 500 forecast