Warren Buffett, Charlie Munger were once asked if Social Security is a 'government-sponsored Ponzi scheme'. Here's how they responded — plus how to ensure your retirement is secure

Buffett clarified that Social Security is essentially a “transfer payment by the people who are in their productive years to the people who are past their productive years.” And he liked that mechanism, stating, “I think that the obligation for the people who do well in this society is to provide a reasonable level of sustenance for those beyond their productive years.”

Buffett’s right-hand man, the late Charlie Munger, strongly defended the program. He said that he felt more strongly than Buffett that the Republicans who were challenging Social Security were “out of their minds.”

His remarks were met with laughter and applause from the audience.

That said, the audience member’s concern is not unfounded.

‘The biggest Ponzi scheme on Earth’

Nobel Prize-winning economist Milton Friedman once called Social Security “the biggest Ponzi scheme on earth.”

Concerns over the sustainability of the program have heightened more recently, with the Congressional Budget Office projecting the exhaustion of the Social Security Old-Age and Survivors Insurance Trust Fund by the fiscal year 2032.

Instead of solely relying on Social Security for your retirement, you can also take matters into your own hands. Proactively investing and saving on your own can provide stability amid Social Security’s uncertain future.

Here are two ways to do just that:

Real estate

Investing in real estate is widely regarded as a robust strategy for retirement planning due to its potential for generating passive income and capital appreciation over time.

Well-chosen properties can offer a reliable source of rental income, which can be used to cover living expenses in retirement, reducing dependency on traditional retirement savings or Social Security.

Additionally, real estate often appreciates over time, as property values and rental rates tend to increase with the cost of living.

New investing platforms are making it easier than ever to tap into the real estate market.

For accredited investors, Homeshares gives access to the $36 trillion U.S. home equity market, which has historically been the exclusive playground of institutional investors.

With a minimum investment of $25,000, investors can gain direct exposure to hundreds of owner-occupied homes in top U.S. cities through their U.S. Home Equity Fund — without the headaches of buying, owning or managing property.

With risk-adjusted internal returns ranging from 12% to 18%, this approach provides an effective, hands-off way to invest in owner-occupied residential properties across regional markets.

If you’re not an accredited investor, investment platforms like mogul allow you to enter the real estate market for as little as $100.

If you’re not an accredited investor, crowdfunding platforms like Arrived allow you to enter the real estate market for as little as $100. Arrived offers you access to shares of SEC-qualified investments in rental homes and vacation rentals, curated and vetted for their appreciation and income potential.

Backed by world-class investors like Jeff Bezos, Arrived makes it easy to fit these properties into your investment portfolio regardless of your income level. Their flexible investment amounts and simplified process allows accredited and non-accredited investors to take advantage of this inflation-hedging asset class without any extra work on your part.

Getting started is a quick and easy process. With a minimum investment of $250, you can sign up for an account and then browse available properties. Once you verify your information with their team, you can invest in the properties of your choice in as little as 30 seconds.

For those interested in investing in commercial real estate, consider First National Realty Partners, a platform that enables individual investors to tap into institutional-quality, grocery-anchored properties.

As a private equity firm, FNRP acts as the deal leader, providing expertise, doing the legwork and streamlining the process, while investors passively collect distribution income.

Gold

Precious metals — particularly gold — have been a popular hedge against inflation. The reason is simple: They can’t be printed out of thin air like fiat money.

Moreover, investors often rush toward gold in times of crisis, making it the go-to safe haven asset.

Amid surging inflation and geopolitical instability, gold prices have reached new heights, now standing at over $2,900 per ounce.

The most direct way to play the precious metal is to own bullion. Investors can also buy shares of gold mining companies or ETFs.

Opting for a gold IRA gives you the opportunity to hedge against market volatility by allowing you to invest directly in physical precious metals rather than stocks and bonds.

Priority Gold is an industry leader in precious metals, offering physical delivery of gold and silver. Plus, they have an A+ rating from the Better Business Bureau and a 5-star rating from Trust Link.

If you’d like to convert an existing IRA into a gold IRA, Priority Gold offers 100% free rollover, as well as free shipping, and free storage for up to five years. Qualifying purchases will also receive up to $10,000 in free silver.