Dave Ramsey has harsh words about your Social Security payments

A recent report from the Social Security Administration confirmed that without legislative changes, one of its two major trust funds will no longer be solvent in 2033.

And recently, personal finance author and radio host Dave Ramsey didn’t mince words about his opinion on the state of the federal program.

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It is important to note that legislative action is possible to fix the solvency problem before 2033. Also, even without legislative intervention, the depletion of the trust fund does not mean that Social Security benefits will cease.

In fact, continued funding from payroll taxes is expected to cover about 80 percent of currently scheduled benefits.

The topic came up when Ramsey was recently asked by an advice seeker about another government benefit.

“Dear Dave,” a man identifying himself as Brandt wrote in an email Ramsey Solutions sent to TheStreet. “We have been following your plan for some time. We are debt free except for our home and have six months worth of expenses set aside in our emergency fund. I recently lost my job. I’m luckier than some because I got a generous severance package from my former employer, plus my wife still has a good job.”

“My parents always raised me to take care of things myself and not rely on others,” he continued. “I guess that’s why I feel a little guilty about filing for unemployment.

Ramsey then explained his views on Social Security before offering insight on Brandt’s compelling question about unemployment benefits.

Dave Ramsey calls Social Security a ‘math failure’

Ramsey first responded to Brandt with some personal comments about the new reality he and his family find themselves in.

“I really appreciate your self-sufficient attitude,” he wrote. “I don’t know what happened at your last job, but I have a feeling you’re a hard worker and a decent guy. I’m sorry you and your wife have to deal with this.”

Next, the personal finance personality bluntly stated his take on the current state of Social Security.

“The Social Security system in this country is a mathematical failure,” he wrote. “But that doesn’t mean I won’t get my money when I deserve it. The government took it from me in the first place, so I have no problem accepting something I’ve already paid for. “

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Ramsey pivoted from that opinion on accepting a government benefit to Brandt’s question about unemployment compensation.

“Now, I’m going to throw out a caveat here,” Ramsey said. “Sometimes when people start receiving unemployment benefits, it causes them to take their foot off the gas. The idea that ‘free’ money is coming in can help them rationalize staying at home on the couch instead of working hard to find another job and being very careful with their finances.”

“I’m not hearing that kind of mentality from you, though,” he continued. “And it’s obvious that you and your wife have been pretty smart with your finances.”

An unemployed man is seen in front of a computer worried about finding a job. Personal finance coach Dave Ramsey offers advice for unemployed workers.

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Dave Ramsey suggests another personal finance strategy

The Ramsey Show host offered some tips on how people can most effectively handle periods of unemployment.

“One more thing I would suggest is to make sure you only look at your severance package as survival money,” he wrote. “Make a strict budget and stick to it. Give up all excess spending. That means no more eating out, vacations, or anything like that until you’re working again and everything is back on solid ground.”

“Right now, focus on covering the four walls,” Ramsey added. “By that, I mean food, utilities, shelter and transportation. Feed your family, keep the electricity on, pay the mortgage and put enough gas in the car to get you where you need to go.”

Related: Dave Ramsey Has a Major Warning About Retirement, 401(k), Social Security

Ramsey concluded with some words of encouragement.

“Everyone hits a rough patch in life every now and then, Brandt,” he wrote. “But you two are able to handle it better than most. Just remember what got you to such a good place with your finances in the first place.”

“The discipline muscle is already there and it’s strong. Just flex it and it’ll get you through this and back on your feet!”

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