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Personal finance guru Dave Ramsey has spent several decades watching people sleepwalk into retirement disasters.
In an interview with Kiplinger (1), the author and podcaster applied his pattern recognition to reveal some of the most common mistakes he’s seeing near-retirees make in 2026.
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Here’s his blunt message for anyone over the age of 55.
Mistake 1. Carrying too much debt
Ramsey has witnessed a steady rise in senior debt over the years, which is a genuine cause for concern.
Between 1992 and 2022, the average debt burden for households headed by people aged 65 to 74 quadrupled, according to an AARP report (2) citing the Fed’s most recent Survey of Consumer Finances (SCF). This cohort now carries $45,000 in debt on average.
For households 75 and up, the debt burden has jumped sevenfold in the same period, from under $5,000 to $36,000.
“They hang onto debt. Especially mortgages and car payments. Then they assume they’ll just ‘manage it’ in retirement,” Ramsey told Kiplinger. “The fix is simple. Attack that debt with intensity now, before you step into your golden years.”
Two of the big strategies for paying down debt are the avalanche and snowball techniques.
The avalanche starts, as the name suggests, with tackling your biggest debt. Once it’s paid off, you can funnel that money into paying off your smaller debts in a cascade. Generally speaking, this will save you money in the long run.
The snowball takes the opposite approach. By knocking off your smaller debts first, you can build up momentum to tackle your biggest one. However, this strategy runs the risk of allowing your highest-interest debt to continue eating away at your repayment power.
To decide between the two, you’ll need to dig into how your interest payments break down across all of your debts — a painful, but essential first step.
If you have multiple debts that you’re struggling to track, you could also wrap them together into one payment. Consolidating all your debts into a personal loan through Credible can be an effective way to get rid of your debt faster. Instead of juggling multiple monthly payments, you’ll have one predictable payment to manage each month.
Through Credible’s online marketplace, finding the right loan becomes much simpler. Credible lets you comparison-shop for the lowest interest rates with just a few clicks.
In less than three minutes, you’ll see all the lenders willing to help pay off your credit cards or other debts with a single personal loan.
If you owe a substantial amount, you may also want to see if you qualify for a debt relief program to help clear a significant portion of your debt.
With Freedom Debt Relief, you can speak with a certified debt relief consultant for free, who can show you how much you can save by partnering with them.
If you’re eligible, they can negotiate settlements with your creditors until all of your enrolled debt is resolved. Just make sure to assess your options before committing to a strategy.
Read More: Here’s the average income of Americans by age in 2026. Are you falling behind?
Mistake 2. Retiring too early without preparation
Despite the challenges, many Americans continue to hope for a chance to leave the workforce early. Roughly 18% of people surveyed by YouGov in 2024 (3) said they plan to retire at or before the age of 55.
However, leaving the workforce a decade or so early has real risks, as Ramsey highlights. First, without Medicare coverage, early retirees might need to find a way to pay for medical insurance, which pushes their budget higher. Second, a longer retirement increases the chances of outliving your money.
These challenges are solvable. A clear and robust financial plan could help you cover all your bases before you take the leap. You can also create a back-up plan for part-time or gig work to cover any unexpected gaps that arise during early retirement.
The takeaway, Ramsey told Kiplinger, is: “Don’t retire until you’re truly ready.”
Mistake 3. Over-relying on Social Security
Ramsey isn’t a fan of the Social Security system. In a previous interview on the Iced Coffee Hour (4) with Graham Stephan, he said the underlying funds were earning a “negative return” and the system was never designed to be anyone’s retirement plan.
His concerns seem justified given that the Social Security trust fund is on course for depletion by 2032, just six years away, according to a Congressional Budget Office (CBO) report cited by the Peter G. Peterson Foundation (5). If this happens, benefits will be cut by 28%, according to testimony delivered by Molly Dahl, Chief of Long-Term Analysis at the CBO (6), to the Committee on the Budget of the United States Senate.
With this in mind, over-relying on benefit checks could be a big mistake for retirement planners. Consider ways to bolster your own safety net to supplement any changes or reforms to the Social Security system that could diminish your payments.
For instance, you could add income-generating real estate exposure through platforms like Arrived.
Backed by world-class investors, including Jeff Bezos, Arrived allows you to invest in shares of vacation and rental properties, earning a passive income stream without the extra work that comes with being a landlord of your own rental property.
To get started, simply browse through their selection of vetted properties, each picked for their potential appreciation and income generation. Once you choose a property, you can start investing with as little as $100, potentially earning monthly dividends.
Once you’re an investor with Arrived, you’ll gain access to their newly launched secondary market, where investors can buy and sell shares of individual rental and vacation rental properties directly on the platform.
This allows you to buy into properties you may have missed at the initial offering or sell shares before a property reaches the end of its hold period.
With access to more than 400 properties in 60 cities, this new way to trade real estate opens up flexibility and opportunities to gain access to more properties if your appetite to invest increases.
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Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see our ethics and guidelines.
Kiplinger (1); AARP (2); Yougov (3); The Iced Coffee Hour/ YouTube (4); Peter G. Peterson Foundation (5); Congressional Budget Office (6)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
