Project retirement the Dave Ramsey way: check the 15% rule, hit millionaire milestones, and compare his 8% vs the safe 4% withdrawal.
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Dave Ramsey's Baby Step 4 says to invest 15% of your gross household income into tax-advantaged retirement accounts. This calculator projects your nest egg using the Ramsey method, but it is deliberately more transparent than most: you choose a realistic (7%), moderate (10%), or Ramsey-headline (12%) return, and you see both the mainstream 4% safe-withdrawal income and Dave's controversial 8% figure side by side.
Dave Ramsey's retirement strategy is Baby Step 4 of his 7 Baby Steps, started once you have no debt (except the house) and a 3–6 month emergency fund. The core rules: invest 15% of gross household income (the employer match does NOT count toward the 15%); fund accounts in order — 401(k) up to the match, then a Roth IRA, then back to the 401(k) to reach 15%; use growth stock mutual funds; and stay invested for the long term. Ramsey quotes a 10–12% return from the S&P 500's long-run average — but that figure is the arithmetic average; the compound (geometric) return is closer to 10%, and about 7% after inflation, which is why this tool lets you pick a rate.
Future Value Formula
Completed Baby Steps 1–3? See how your freed-up cash flow builds real wealth once you invest 15% in Baby Step 4.
Not sure you're hitting 15%? Enter your income and contribution for instant feedback and the monthly gap to close.
See how much your employer's 401(k) match adds — it's free money you capture first, before the Roth IRA step.
Starting Baby Step 4 later in life? See what aggressive, consistent saving can still build and when you reach each milestone.
Enter your income and see whether your contribution hits Dave's Baby Step 4 target of 15% of gross income — and exactly how much more per month you'd need if you're short.
Dave says you can withdraw 8% a year; most planners say 4% (the 25× rule). We show both monthly incomes so you can judge the trade-off yourself instead of taking one number on faith.
Pick a realistic 7%, a moderate 10% (closer to the compound S&P return), or the 12% Ramsey headline. The default is 10% so your projection is not inflated by the most-criticized assumption.
See the exact ages you cross $100k, $500k, and $1 million so you can watch consistent investing turn into real wealth — the motivator at the heart of the Ramsey method.
Dave Ramsey argues that because growth stock mutual funds average about 12% and inflation runs about 4%, you can withdraw 8% of your nest egg every year in retirement and never run out. Most financial planners disagree: the widely used 4% rule (the '25× rule', from the Trinity and Bengen studies) is designed to make savings last ~30 years, while an 8% withdrawal has a high chance of depleting the account — especially if the market falls early in retirement (sequence-of-returns risk). This calculator shows income at both 4% and 8% so you can compare.
Ramsey found that investing 15% of gross income — started early and kept consistent — typically builds enough to retire comfortably while still leaving room for other goals like kids’ college (Baby Step 5) and paying off the house early (Baby Step 6). Less than 15% risks falling short; much more can starve those other steps.
Dave cites the S&P 500's long-run average of about 10–12%. That 12% is an arithmetic average; the compound (geometric) return an investor actually earns is closer to 10%, and roughly 7% after inflation — before fees. For planning, many advisors use 7–8%. That's why this tool defaults to 10% and lets you switch to 7% or 12%.
Ramsey doesn't give one dollar figure — he says invest 15% consistently and let compounding do the work. To translate a nest egg into income, the mainstream 4% rule implies you need about 25× your annual expenses; Dave's 8% rule implies about 12.5×. This calculator shows the annual and monthly income your projected balance would produce under both rules.
No. Dave Ramsey says the 15% should come from your own income; the employer match is a bonus on top. That said, always contribute at least enough to capture the full match before funding a Roth IRA — it is an immediate, guaranteed return.
Per Ramsey: (1) your 401(k) up to the full employer match, (2) a Roth IRA up to the annual limit ($7,500 in 2026, or $8,600 if you are 50 or older), then (3) back to the 401(k) or 403(b) for whatever is left to reach 15%.
Ramsey recommends spreading investments evenly across four types of growth stock mutual funds — Growth, Growth & Income, Aggressive Growth, and International — with long track records. He advises against bonds for long-term retirement money and discourages picking individual stocks.