Podcast Summary: Ramsey Everyday Millionaires

Episode: How Should I Invest Outside of a 401(k)?
Date: November 17, 2025
Hosts Featured: Dave Ramsey, Chris Hogan
Caller: Jay from Anchorage, Alaska

Overview

This episode tackles a nuanced question—what should high-income earners do when they're no longer eligible for a traditional company 401(k)? Through Jay’s real-life scenario, hosts Dave Ramsey and Chris Hogan explore alternative investment options, the pitfalls of unqualified plans, and broader advice for maximizing retirement savings outside of standard workplace offerings. The tone is practical, encouraging listeners to seek tailored investment guidance and remain vigilant about the true value and growth potential of available plans.

Key Discussion Points & Insights

1. Caller’s Situation: Losing 401(k) Eligibility

• [00:19-00:58]
  • Jay explains he received a promotion, which in turn disqualifies him from participating in his company’s 401(k) due to a compensation threshold.
  • The company offers an alternative: a pre-tax, unqualified retirement plan with a small match, mainly invested in bond funds.
  • Jay voices concern about the plan’s unfunded nature and low returns (~5%).

2. Assessment of Unqualified Plans and Bond-Focused Investments

• [00:58-01:36]

  • Dave and Chris probe details on the plan’s returns and structure.
  • Chris Hogan shares skepticism about the 5% bond fund return, suggesting it’s not an optimal growth vehicle for retirement assets.
  • Notably, both hosts express hesitancy toward unfunded, unqualified plans and limited-growth investments like bonds.

  Chris Hogan [01:34]: “That’s not very good.”

3. Alternative Investment Options

• [01:36-02:18]

  • Chris recommends considering a backdoor Roth IRA if income precludes standard Roth contributions.
  • Both hosts advocate for consulting with a SmartVestor Pro for deeper guidance and exploring vehicles like index funds and mutual funds for superior long-term growth compared to bonds, even accounting for capital gains taxes on withdrawal.

  Chris Hogan [01:55]: “It’s going to be a better growth rate.”
  Dave Ramsey [02:00]: “Even from index funds to mutual funds, you’ll get a better rate of return just doing something like that.”

4. Income Thresholds and Roth IRA Eligibility

• [02:22-02:28]

  • Jay’s salary ($165K base, up to $250K with bonuses) triggers a clarification—he may still be eligible for a standard Roth IRA, which Dave strongly recommends maximizing.

  Dave Ramsey [02:28]: “I think you’ll still qualify for a traditional Roth IRA at that range. So I would definitely be funding that.”

5. Company Match: Is It Worth It?

• [02:51-03:03]

  • Jay shares specifics: company matches 50% of the first 6%.
  • Hosts acknowledge the draw of “free money,” but remain wary, reiterating the poor overall return from the bond fund-heavy plan.

  Dave Ramsey [02:56]: “It’s hard because it’s free money coming from the company. Right?”
  Chris Hogan [03:01]: “5% is…”

6. Final Recommendations and Broader Advice

• [03:10-04:13]

  • Both hosts maintain that Jay (and listeners in similar situations) will be better off investing independently via Roth IRAs, index funds, and mutual funds.
  • Dave cautions that investment advice isn’t “one-size-fits-all”—consulting with a professional is crucial due to the complexities of changing employer offerings.
  • Discussion broadens: more companies are now offering Roth 401(k)s, and the investment landscape is evolving.
  • Both hosts agree: Bonds, even as you age, often don’t justify their limited growth compared to diversified mutual funds.

  Dave Ramsey [03:15]: “I always hate giving blanket investing advice… There are some ins and outs.”
  Chris Hogan [03:46]: “Good on him for looking deeper and seeing what those investments are…”

  Dave Ramsey [04:13]: “I’m just never a fan of bonds… Even as you get older, I just don’t think it’s worth the limited growth.”

Notable Quotes & Memorable Moments

• Chris Hogan [01:34]: “That’s not very good.”
• Dave Ramsey [02:00]: “Even from index funds to mutual funds, you’ll get a better rate of return just doing something like that.”
• Dave Ramsey [02:28]: “I think you’ll still qualify for a traditional Roth IRA at that range. So I would definitely be funding that.”
• Dave Ramsey [03:15]: “I always hate giving blanket investing advice… There are some ins and outs and different employers are offering different things.”
• Dave Ramsey [04:13]: “I’m just never a fan of bonds… Even as you get older, I just don’t think it’s worth the limited growth.”
• Chris Hogan [03:46]: “Good on him for looking deeper and seeing what those investments are and what their track record have been at as opposed to just saying this looks good. I’ll check the box. Right.”

Important Timestamps

• [00:14-00:58] Jay describes his promotion, losing 401(k) access, and the new unqualified plan.
• [01:34] Chris Hogan voices skepticism about 5% bond returns.
• [01:36-02:18] Alternatives discussed: Roth/backdoor Roth IRAs, index/mutual funds.
• [02:22-02:28] Jay shares income; Dave clarifies Roth IRA eligibility.
• [02:51-03:03] Company match specifics and the hosts’ calculus on whether it’s worthwhile.
• [03:10-04:13] Hosts’ final advice, focus on professional guidance, and anti-bond growth philosophy.

Conclusion & Actionable Advice

• Max Out Your Roth IRA: Even high earners may still be eligible, so fund it to the limit.
• Be Skeptical of Bond-Focused, Unqualified Plans: They often offer limited return and insufficient long-term growth for retirement savings.
• Consult a Pro: Personalized advice is critical, particularly amid evolving employer plan options.
• Know Your Investments: Don’t just check the box—understand the underlying assets and expected return.
• Aim for Growth: Index and mutual funds typically provide better returns than bonds, regardless of age.

This episode emphasizes the importance of understanding your investment options beyond the traditional 401(k)—especially when your compensation changes your eligibility. The core message is clear: prioritize higher-growth vehicles, get professional advice, and never assume the “company plan” is the best or only path for retirement savings.