Podcast Episode Summary

Podcast: Ramsey Everyday Millionaires
Episode: How Do I Choose the Right Investments in My 401(k)?
Date: September 22, 2025
Hosts: Dave Ramsey (A), with callers and co-hosts
Theme: How to choose the right investment strategy for your 401(k), particularly later in life, and the importance of not letting your money sit idle. Real-life listener questions provide relatable context and practical investing insights.

Episode Overview

This episode addresses a common concern among listeners: how to make smart, informed choices about investing a 401(k), especially if you're approaching retirement age or have had an employment setback. The hosts review someone’s real-life financial scenario, giving actionable investment guidance, and emphasize the pitfalls of letting retirement money languish in low-return holding accounts.

Key Discussion Points & Insights

Craig’s 401(k) Dilemma (00:16 – 02:22)

• Background: Craig, age 59, currently unemployed after a layoff. He owns his house outright, has a 401(k) with $400K, another retirement account with $80K, and $80K in savings.
• Challenge: Craig hasn’t invested his 401(k); it’s sitting in a money market-like account, earning little to nothing.
• Current Situation: Considering re-entering the workforce in the next three months after a period focused on recovering from health issues.

The Dangers of Sitting on Cash (01:08 - 02:35)

• Opportunity Cost:
  • Dave Ramsey: “Last year the S and P was up 24%. The year before it was up 26%. So if you missed out on two years, you probably lost 200 grand.” (02:23)
  • Craig admits he’s kept his retirement money idle for too long and missed significant market gains.
• No Shaming, Just Motivation:
  • Dave: “My point is not to shame you for the past. My point is to motivate you for the future.” (02:35)

How to Invest Your 401(k) at This Age (01:09 - 02:23, 03:39 - 04:09)

• Recommended Strategy:
  • Roll the inactive 401(k) into an IRA.
  • Invest equally in four types of mutual funds:
    • Growth
    • Growth & Income
    • Aggressive Growth
    • International
  • Dave’s Allocation: “I have mine invested in four types of mutual funds. Equally. Growth, Growth in income, aggressive growth and international. Have 25% in each.” (01:14)
• Future Growth Potential:
  • At 10% average returns (historically reasonable for the market), Craig’s $400K could double to $800K in 7 years; in 14 years, it could reach $1.6 million.

Mindset and Accountability (03:34 - 04:09)

• Taking Responsibility: Craig admits he did every Ramsey Baby Step "right, except for the investing" (03:39).
• Dave’s Encouragement:
  • “You’ve done great… It feels like you’ve been coasting a minute here… We don’t want the money resting. It works 24/7. So put it back to work.” (03:44)
  • Use the resources at Ramsey Solutions—such as SmartVestor Pros—to get matched with a trusted investment advisor.

The Magic of Investing: Money Should Always Work (04:09 – End)

• Dave Ramsey on Money’s Potential:
  • “The good news, folks, about your investments is your money never gets sick, it never gets burnout, it never gets tired. It works 24/7. It’s automatic. Put it to work, it doesn’t get pregnant. It doesn’t become disabled. It doesn’t have any issues. It doesn’t feel entitled. It just works 24/7. So put your freaking money to work, folks. It’s a magical thing.” (04:11)
• Key Takeaway: Letting investment money sit on the sidelines is missing out on one of the most powerful wealth-building tools—compounding returns.

Notable Quotes & Memorable Moments

• On Missed Market Gains:
  • Dave Ramsey (02:23): "Last year the S and P was up 24%. The year before it was up 26%. So if you missed out on two years, you probably lost 200 grand.”
• On Using Money Wisely:
  • Dave (03:44): “We don’t want the money resting. It works 24/7. So put it back to work.”
• On the Nature of Money:
  • Dave (04:11): "Your money never gets sick, it never gets burnout, it never gets tired. It works 24/7… So put your freaking money to work, folks. It’s a magical thing."

Important Timestamps

• 00:16 – Craig introduces his question about investing his 401(k)
• 01:14 – Dave's recommended mutual fund allocation
• 02:23 – Dave highlights the cost of missing market growth
• 03:39 – Craig admits he didn’t invest his 401(k)
• 03:44 – Dave’s encouragement and investing mindset
• 04:11 – Dave’s motivating summary on why money must be put to work

Recommendations and Next Steps

• If you have an old 401(k), don’t let it idle—roll it into an IRA and invest in diversified mutual funds.
• Take ownership of your financial journey, but don’t dwell on past mistakes; focus on what your money can do going forward.
• Leverage trusted resources, such as investment pros, to educate yourself and make informed choices.

In Summary

This episode is a motivating call to action for anyone reluctant or behind on investing. The frank, friendly tone makes clear: It’s never too late to get invested, put your money to work, and make up for lost time.