Should You Invest in Crypto? Here's What Dave Ramsey Thinks

Don't buy cryptocurrency without considering this practical advice.

Personal finance guru Dave Ramsey has a popular radio show and blog, and also offers educational training material to people looking to develop financial peace. He has addressed many issues in his years of providing advice on money matters. As a result, it's not at all surprising that he's provided some guidance on an increasingly popular newer asset class: cryptocurrency.

But is Ramsey a proponent of crypto investing or does he believe you should steer clear? Here's what you need to know about his crypto advice.

Ramsey's opinion on crypto investing

As a general matter, Ramsey hasn't been too optimistic on the prospects of building wealth by investing in cryptocurrencies.

In April 2021, Ramsey referred to both Bitcoin and Dogecoin -- two big-name cryptocurrencies -- as stupid investments. He's also said they are more akin to gambling than to taking the methodical approach to investing he recommends, which involves putting money into mutual funds with an established track record.

Ramsey even compared Bitcoin to playing the lottery, and made clear he believes Bitcoin and other virtual currencies are "best known for two things: They’re really hard to understand and their value is all over the map."

Citing wild swings in the price of different cryptocurrencies, Ramsey warns the bottom could easily drop out after you've put your money in, and this outcome is just as likely to happen as earning a profit.

He went on to say that "We want you to invest your money in something you can fully understand," and that he doesn't believe you should "take unnecessary risks with your retirement or your future."

Does this mean Ramsey is never a fan of investing in cryptocurrency?

Although Ramsey's opinion on cryptocurrency investing undoubtedly leans toward the negative based on his comments, the finance guru doesn't categorically rule out putting some money into virtual currencies or other alternative assets. He just believes you should prioritize other goals first and talk to a financial advisor about all of your options before deciding where to put your money.

"If you’re investing at least 15% of your income for retirement, and you’re on track to meet your retirement goal, there’s room to talk about investing some of your money in other ways," Ramsey's blog says. "After you talk to your investing professional about your mutual fund investments and get that all squared away, ask them about the best way to invest in your financial future. That way your retirement is secure, and you might choose to participate in other new ways to invest."

If you believe buying cryptocurrency could be one of the best "new" ways to invest, you'll definitely want to heed Ramsey's advice and make sure you don't invest in any coins you don't understand, and you have plenty of less-risky investments in your portfolio first.

Any money you can't afford to lose shouldn't be in such a volatile asset, so consider whether you're on track to accomplish your goals and what role crypto investing could play in supplementing the other safer investments within your broader portfolio.