My Boyfriend Thinks 401(k)s Are A Scam

Summary

Podcast Summary: The Ramsey Show Highlights – "My Boyfriend Thinks 401(k)s Are A Scam"

Episode Details

• Title: My Boyfriend Thinks 401(k)s Are A Scam
• Host/Author: Ramsey Network
• Release Date: May 6, 2025

Overview In this episode of The Ramsey Show Highlights, the Ramsey Network addresses a caller's concern about her boyfriend's negative perception of 401(k) retirement plans. Through insightful discussions, Dave Ramsey and Rachel Cruze explore the underlying reasons behind such beliefs, the potential impact on relationships, and offer practical advice on navigating financial disagreements.

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Caller’s Dilemma

The episode begins with a caller reaching out to seek advice about her boyfriend's skepticism toward 401(k) retirement plans.

• Caller: "I've been dating a lovely young man for about nine months and we had a random conversation that came up about retirement savings. I'm a big saver, so I'm really into it. I have a 401k and a Roth IRA. And his response was that all that matters is working and making money now and that 401ks are a scam. I just want to know what the best way to approach this conversation is to try to help him maybe understand the importance of saving for retirement." (00:06)

Understanding the Boyfriend’s Perspective

Rachel Cruze steps in to probe deeper into the boyfriend’s reasoning.

• Rachel Cruze: "Did you ask him why he thinks they're a scam? Was there any kind of follow up on that particular classification of it?" (00:45)

The caller reveals that her boyfriend, a 32-year-old recent U.S. citizen from Albania, holds this belief without a clear explanation.

Dave Ramsey’s Analysis

Dave Ramsey delves into potential reasons behind the boyfriend's viewpoint, considering his background.

• Dave Ramsey: "What he's saying is basically he's saying I'm immature and I don't want to think about the future." (01:04)

Ramsey hypothesizes that the boyfriend's experiences in Albania, possibly involving economic instability or political unrest, have shaped his distrust in financial institutions like 401(k)s.

• Dave Ramsey: "Maybe the instability politically or whatever, safety wise or whatever in that area he was in has influenced this viewpoint." (01:24)

Despite acknowledging possible valid reasons, Ramsey ultimately labels the viewpoint as problematic for long-term financial health.

• Dave Ramsey: "It is a broken and stupid and immature viewpoint. Regardless of how he got there." (02:49)

Implications for the Relationship

Ramsey discusses the broader implications of financial incompatibility in relationships.

• Dave Ramsey: "That's a problem for you because you get to live with someone who's going to do no planning for the future, which guarantees your future sucks." (02:49)

He emphasizes the necessity of addressing such fundamental differences, suggesting that without alignment on financial goals, the relationship may face significant challenges.

Rachel Cruze’s Guidance

Rachel Cruze offers a constructive approach to bridging the financial understanding gap.

• Rachel Cruze: "If, in fact, he's truly scared of this product, 401k, because he doesn't understand it... this is going to be a gradual teaching process for you." (04:06)

Using the analogy of teaching a child to ride a bike, she recommends a step-by-step method to help the boyfriend overcome his fears and misconceptions about retirement savings.

Addressing Fear vs. Misunderstanding

The discussion differentiates between fear based on logical threats and misconceptions fueled by past experiences.

• Dave Ramsey: "False evidence appearing real." (06:50)

• Rachel Cruze: "That's right, [Dave]." (06:53)

Ramsey elaborates that while actual fear is a rational response to immediate danger, the boyfriend's fear of 401(k)s may stem from misunderstanding or past experiences unrelated to the current financial system in the U.S.

Practical Solutions

The hosts propose actionable steps for the caller to take:

1. Open Dialogue: Engage in honest conversations to uncover the boyfriend's specific fears or misconceptions about 401(k)s.

2. Seek Professional Help: Consult a financial advisor (referred to as a "smartvestor pro") to provide expert explanations and alleviate concerns.

3. Evaluate Relationship Compatibility: Consider the long-term implications of financial incompatibility and whether it affects the relationship's viability.

• Rachel Cruze: "Let them sit in that and ask the questions and get with somebody, a third party, in this case a smartvestor pro, who can answer every question about fraud and anything like that." (07:38)

Conclusion

Dave Ramsey and Rachel Cruze conclude by reinforcing the importance of financial planning and compatibility in relationships. They encourage the caller to address the issue proactively, either by helping her boyfriend understand the value of retirement savings or re-evaluating the relationship if alignment isn't achievable.

• Dave Ramsey: "I love you. Don't marry this guy. Ain't worth it." (06:16)

• Rachel Cruze: "It's tempting to roll your eyes at something that's stupid. But you got to honor it and go... get to the root of why and can we solve for it so we can go forward." (08:09)

Notable Quotes with Timestamps

• Dave Ramsey (00:06): "I'm a big saver, so I'm really into it. I have 401k and a Roth IRA."

• Dave Ramsey (02:49): "It is a broken and stupid and immature viewpoint."

• Rachel Cruze (04:06): "This is going to be a gradual teaching process for you."

• Dave Ramsey (06:50): "False evidence appearing real."

• Rachel Cruze (07:38): "Get with somebody, a third party, in this case a smartvestor pro."

• Dave Ramsey (06:16): "Don't marry this guy. Ain't worth it."

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Final Thoughts This episode underscores the significance of financial alignment in relationships and the challenges that cultural backgrounds can pose to financial planning. Dave Ramsey and Rachel Cruze provide a balanced perspective, recognizing the boyfriend's possible legitimate fears while emphasizing the necessity of proactive financial management for a secure future.

Transcript

[Dave Ramsey]

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[Caller]

So, quick question. I've been dating a lovely young man for about nine months and we had a random conversation that came up about retirement savings. I'm a big saver, so I'm really into. I have 401k and a Roth IRA. And his response was that all that matters is working and making money now and that 401ks are a scam. And I just want to know what the best way to approach this conversation is to try to help him maybe understand the importance of saving for retirement.

[Rachel Cruze]

Did you ask him why he thinks they're a scam? Was there any kind of follow up on that particular classification of it?

[Caller]

Not necessarily. He is actually. He moved here from Albania six years ago and he just became a citizen this year. And how old is he? He's 32 and I'm 30.

[Dave Ramsey]

Okay. All right. Well, I mean what he's saying is without. I mean, I don't know why he thinks 401ks in particular are scam, but what he's saying is, is that I came from an area where we are living hand to mouth and thinking about the future is not something I want to do. I want to just enjoy the moment because the way the situation I grew up in there might not be a next moment for whatever reason. I don't know. I'm guessing. Okay, I'm going to try to give him a break here because what he's saying is basically he's saying I'm immature and I don't want to think about the future.

[Caller]

Right.

[Dave Ramsey]

And we can give him a lot of grace as to why he might be in that based on, you know, I mean, I don't know what the situation was in his area of Albania. I'm not privy to that. But I can guess that maybe the instability politically or whatever, safety wise or whatever in that in the area he was in has influenced this viewpoint. Agreed.

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[Dave Ramsey]

All right, back to the call has influenced this viewpoint. Agreed, agreed. But it is a broken and stupid and immature viewpoint. Regardless of how he got there. Regardless how he got there. Okay. And so that's a problem for you because you get to live with someone who's going to do no planning for the future, which guarantees your future sucks.

[Caller]

Right.

[Dave Ramsey]

That's a problem. So that has to be solved relationally going forward. So we have to solve for this and walk him out of that or walk away from him.

[Rachel Cruze]

Yeah, I'm going to recommend Emily. I'm going back to the days when I taught all three of my kids to ride a bike. And if, in fact, he is truly scared of this product, 401k, because he doesn't understand it, maybe there was corruption, all the things that Dave pointed out. If, in fact he's truly afraid of it and that's why he calls it a scam, then, in fact, now you can deal with fear because he doesn't understand it. So it's like teaching someone to ride a bike. They're scared to death to ride the bike. So what do you do? You put training wheels on first. Right. And then you move from training wheels to. I would hold the back of the seat and I would run with them for a bit. The point is, this is going to be a gradual teaching process for you.

[Dave Ramsey]

I think if, in fact, we talk about this relationship being permanent.

[Rachel Cruze]

That's right.

[Caller]

Right.

[Dave Ramsey]

Okay. Now, and so I'll give you another example that runs parallel. Okay. If you come from a Latin American country where the banking system is full of fraud and is unstable and doesn't have an FDIC underpinning and people lose their money when the bank goes broke like they did in the wild, wild west in America. If you come from one of those Latin American countries and you come here, and it's not unusual at all for people from that type of a culture to have a deep distrust of banks. And yet the banking system in America, even though I hate banks, but I mean, your money's not unsafe in a bank in America, that's an absurd idea. But it's based on where they come from, not based on reality. Now, if you're going to marry someone who says, I'm going to stack $200,000 under our mattress, in cash. Because I refuse to accept the fact that American banks are safe based on the country I grew up in. They're not safe then. That's not marriage material. You're marrying someone that has not adapted well to the new culture that they live in and you're going to have problems as a result and shortages and issues. And so, you know, you've got to make. They have to make the transformation if that's what it is, if it's immaturity. I'm 14 years old and I'm going to live for Friday. Thank God. It's Friday party for the weekend and I meet 57 year old Americans who do that. Okay. They have no. Where there is no vision. The people perish and they end up retiring and trying to live on Social Security and griping and whining because all the opportunity is gone in America because they drank theirs on Friday night because they were so freaking childish. Now I meet those that are Americans that are 57 years old. You don't want to be married to that guy, you know, 25 years from now. Agreed?

[Caller]

Agreed? Yes, sir.

[Dave Ramsey]

So I think you got to work. I think you're wise to bring the question up and you got to work through this with him or I'm going to be your old ugly Uncle Dave and say, I love you. Don't marry this guy. Ain't worth it.

[Caller]

Yes. I appreciate all the advice. Thank you so much.

[Dave Ramsey]

That's a really cool question.

[Rachel Cruze]

It really is. I would take him to your smartvestor pro if you have one, if you don't need to get one. But I would literally take him in there. I'd honor all of his questions. If in fact. And Dave and I don't know, but if in fact he's scared. I think the best way to help someone who's scared is to honor their fear.

[Dave Ramsey]

Well, there's two types.

[Rachel Cruze]

What are you afraid of?

[Dave Ramsey]

False evidence appearing real.

[Rachel Cruze]

That's right.

[Dave Ramsey]

Which is, you know, if I invest. I fell on my bicycle the last time you let go of the seat and I skinned my knee. So the next time you let go, I'm going to die.

[Rachel Cruze]

That's. That's right.

[Dave Ramsey]

That's false evidence appearing real. You know, actual fear is of something that is logical. If you're standing in the middle of the interstate and 18 wheelers coming at you at 100 miles an hour, you should move.

[Rachel Cruze]

That's right.

[Dave Ramsey]

That's actual fear. You're going to die. You know, that's a lot different though. And so this is a, this is false evidence appearing real or it's immaturity, I don't know which. And, but it's one of those two things. And either way you got to deal with it to go forward. So we gotta go, we gotta drill down, we gotta get the ground to zero on this and then work our way out. Really good question.

[Rachel Cruze]

And I just wanna point out, again, when you're in a relationship and you're not on the same page and it's really fear holding the spouse or a boyfriend or girlfriend back, honor their questions, don't dismiss them, don't always try to explain them. Let them sit in that and ask the questions and get with somebody, a third party, in this case a smartvestor pro, who can answer every question about fraud and anything like that. And if hopefully they get there in the light bulb goes off and now we're on the same page.

[Dave Ramsey]

Yeah, it's, it's tempting to roll your eyes at something that's stupid.

[Rachel Cruze]

That's right.

[Dave Ramsey]

But it, but you can't, you got to honor it and go, okay, there's a reason for this. And then let's get to the root of why and can we solve for it so we can go forward? Because you know, we're not aligned on what reality is here. And when you can't align on reality, you have a problem. Create your free every dollar budget today. The simplest way to budget for your life.