How-to · Updated October 2, 2026
How much is 15% of your income for retirement under Dave Ramsey?
Direct answer
Baby Step 4 is 15% of gross household income. On $70,000 that is $10,500 a year ($875 a month). On $100,000 with a 4% match, put $4,000 in the 401(k), $7,500 in a Roth IRA, and $3,500 back in the 401(k).
15% by salary
Single filer, age 35, 4% match, 2026 IRA limit of $7,500. The match is extra and is not inside the 15%.
| Gross income | Your 15% | Per month | 401(k) | Roth IRA |
|---|---|---|---|---|
| $50,000 | $7,500 | $625 | $2,000 | $5,500 |
| $70,000 | $10,500 | $875 | $3,000 | $7,500 |
| $100,000 | $15,000 | $1,250 | $7,500 | $7,500 |
| $150,000 | $22,500 | $1,875 | $15,000 | $7,500 |
On $100,000 the employer adds $4,000, so $19,000 is invested that year. The 2026 401(k) deferral limit is $24,500.
What $875 a month grows into
The calculator’s default plan is a 30-year-old with $25,000 saved, investing $875 a month (15% of $70,000) at 11% until 67. That balance is about $6,828,425, or $2,287,406 in today’s dollars after 3% inflation. From zero, $1,042 a month for 30 years at 11% is $2,922,310, the figure in Ramsey’s published 15% table.
$875 a month reaches $1 million in about 22.3 years at 11% and about 29.3 years at 7%.
Limits
- Educational estimate of Baby Step 4. Not affiliated with Ramsey Solutions, and not financial or tax advice.
- Roth IRA contributions phase out in 2026 at $153,000–$168,000 for single filers and $242,000–$252,000 for married filing jointly.
- Catch-up contributions start at 50: an extra $8,000 in a 401(k) and $1,100 in an IRA. Ages 60–63 can defer an extra $11,250 in a 401(k).
Use the calculator
The nest-egg side of the same method: how much you need to retire under Dave Ramsey. Enter your income in the Dave Ramsey retirement calculator.