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Dave Ramsey has spent decades encouraging Americans to give generously (1). The personal finance personality says he tithes 10% of his own income to his local church and frequently speaks about the importance of charitable giving.
But when one caller to his show said church leaders were encouraging members to focus less on retirement investing and more on giving to the church, Ramsey didn’t hold back.
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“The way you presented this, it sounds like crazy,” Ramsey said on an episode of The Ramsey Show (2), which has garnered new attention after a clip (3) recently went viral.
Ramsey described the advice as “not biblical” and argued that Christians should not stop saving for retirement in order to fund their local church.
The caller, who identified himself as Daniel from Oklahoma, said his church leadership had encouraged congregants not to focus on retirement investing because market-based investments can rise and fall, while investments in the church and God’s word would “always prosper.”
In response, Ramsey argued that generosity and long-term financial planning aren’t mutually exclusive. While he defends the practice of tithing, he also pointed to biblical passages that encourage saving, diligence and preparation for future needs.
Can tithing hurt your retirement?
For many Americans, tithing is an important expression of faith rather than a purely financial decision. In fact, it’s so important that the Lead Pastor (4) claims 40% of American Christians tithe, collectively totaling tens of billions of dollars a year.
But are those charitable donations crowding out other financial priorities such as saving for retirement, building emergency funds or paying down high-interest debt?
According to a study (5) led by Ashley LeBaron-Black, currently a professor at Brigham Young University, high levels of religious involvement significantly affect family finances. The data from the study showed that religious obligations are something of a double-edged sword for personal finance — faith community provides a social safety net, leading to more pressure to give back for families living paycheck to paycheck.