What Do I Need To Do To Retire in 9 Years?

Summary

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Episode Overview

Podcast: Ramsey Everyday Millionaires
Episode: What Do I Need To Do To Retire in 9 Years?
Date: August 20, 2025
Hosts: Dave Ramsey and Ramsey Network Team
Theme: The episode explores the actionable steps one listener, Sylvia, needs to take to securely retire in nine years. Using her real financial details as a case study, Dave Ramsey provides detailed advice on debt payoff, disciplined investing, and the path to a multi-million dollar retirement.

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Main Discussion Points & Insights

1. Sylvia’s Starting Point and Concerns

• Sylvia’s Profile:
  • Age: 56, self-employed, plans to retire by 65 (00:21)
  • Assets: $1.2M in retirement accounts, $125K in savings (00:41)
  • Income: $350K–$400K/year, inconsistent as self-employed (01:11)
  • Debt: $292K left on the mortgage, debt on two cars, college expenses for son (01:18, 04:47, 04:53)
• Key Question: “Do I put more money towards my 401k or do I pay off my car notes?” (02:31)

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2. Investment Strategy and Projections

• Compounding on Retirement Savings:
  • If invested in good mutual funds (currently at ~11% return):
    • $1.2M will double in 7 years to $2.4M.
    • With continued contributions and 9 more years of growth: projected to reach about $4M. (01:48–02:21)
  • "Your 1.2 will be 2.4 and you've got nine years. So let's call that 2.4. Let's call it three, three and a half, something like that. And plus you're going to be adding to it. So let's go ahead and call it four..." — Dave Ramsey (01:57–02:21)

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3. Tackling Debt and Building Wealth

• Priority Order:
  • First: Pay off all consumer/car debt immediately, even before maxing out retirement this year. (02:48–02:54)
  • Second: Avoid any new debt, especially for cars. (02:55)
  • Third: Accelerate the mortgage payoff if possible, aiming for sooner than the current 9-year plan. (02:54–03:14)
• Execution: “You pay off your car note, you stop putting money in retirement to get your car paid for. And then you quit borrowing money.” — Dave Ramsey (02:48)

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4. Creating a Retirement Income Plan

• Withdrawal Rate: At $4M net worth, living on 8% annual drawdown equals $320K/year.
  • Dave advises a more conservative calculation: “8 is going to be $240,000 a year... And you're not even touching the 4 million. And you're growing it by 3% a year.” (03:59–04:00)
  • Emphasis on letting investments continue to grow faster than withdrawals, maintaining and increasing wealth through retirement. (04:00–04:21)
• Discipline: Key is to “execute the plan... You can't go screwing around... If you execute the plan that you already were on and we just tuned, that's where you'll be.” — Dave Ramsey (04:00–04:21)

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5. Memorable & Notable Moments

• On borrowing with her income:
  • “Car debt with your income and your net worth is just lazy. Okay, you know better.” — Dave Ramsey (05:07–05:13)
• On immediate action:
  • “Take the money out of my savings account, pay off both these cars tomorrow.” — Sylvia (05:17–05:23)
• On the projection for Sylvia’s future:
  • “You're going to have $4 million... living on a quarter million dollars a year. Pretty good situation.” — Dave Ramsey (05:34–end)

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Key Timestamps

• 00:21: Sylvia introduces her retirement question
• 01:16–01:41: Income and assets overview
• 01:48–02:21: Dave projects the growth of Sylvia’s retirement
• 02:31–02:54: Discussion on debt payoff versus retirement funding
• 03:48–04:21: Explanation of sustainable retirement withdrawals
• 05:03–05:13: Strong advice on eliminating all consumer debt
• 05:23–end: Action plan review and confidence for the future

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Quotes & Soundbites

• “Quit borrowing money. Okay? Stop it. If you want to retire with dignity...”
  — Dave Ramsey (02:55)
• “You pay off your car note, you stop putting money in retirement to get your car paid for. And then you quit borrowing money.”
  — Dave Ramsey (02:48)
• “Car debt with your income and your net worth is just lazy. Okay, you know better.”
  — Dave Ramsey (05:07)
• “So, so I can pay off... Take the money out of my savings account, pay off both these cars tomorrow.”
  — Sylvia (05:17–05:23)
• “You're going to have $4 million... You’re going to be living on a quarter million dollars a year. Pretty good situation.”
  — Dave Ramsey (05:34–end)

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Summary Flow

• Sylvia, 56, wants clear guidance to retire by 65.
• With solid assets and strong income but some remaining debt, Dave breaks down order of priorities: pay off all consumer debt fast, double down on investing, and avoid any new borrowing.
• Clear emphasis on discipline, patience, and executing the plan without diversions.
• By following this approach—car debt gone, mortgage paid ahead of schedule, steady investing—Sylvia can expect to retire with a paid-for house and $4 million, drawing a comfortable annual income without eroding her nest egg.
• The tone is classic Ramsey: direct, no-nonsense, and empowering.

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Transcript

[A]

This episode is brought to you by SmartVestor. Connect with an investing pro near you at RamseySolutions.com SmartVestor Sylvia is in Houston. Hi Sylvia. Welcome to the Ramsey Show.

[B]

Thanks, Dave. Thanks for taking my call.

[A]

Sure. What's up?

[B]

So I'm 56 years old and I would like to retire by 65 at the very latest. And I'm starting to stress about if I'm on track and how to manage the next nine years financially so that I'm in a good position.

[A]

How much is in your nest egg now?

[B]

Well, so I have like 1.2 million in my retirement account. I owe, So I have $125,000 in my savings account. But because I'm self employed, I put the money there to Pay for my 401k, my quarterly, my office overhead and everything like that. And my income is very inconsistent. So some months I make.

[A]

What is your annual income?

[B]

It's usually between 350 to 400,000.

[A]

Okay. And do you have any debt?

[B]

Yes, I do. I still owe $292,000 on my mortgage. I'm on track to have that paid off by 2033, like within the next 10 years. I'm happy. I'm on track to pay that off.

[A]

Okay. All right. So nine years from now your house is paid for. Your 1.2, if it's in good mutual funds, will be 2.4, probably more like 4, probably around 4 million.

[B]

Okay.

[A]

If it's in good mutual funds, is it?

[B]

Yes, I have it professionally managed. So it's, it's, the rate of return is close to 11%.

[A]

Okay, good. All right, then it's going to double and then your lump sum that's already there is going to double in seven years. Okay. So your 1.2 will be 2.4 and you've got nine years. So let's call that 2.4. Let's call it three, three and a half, something like that. And plus you're going to be adding to it. So let's go ahead and call it four and a paid for house and you'll be 65.

[B]

Yes.

[A]

Okay. Paid for house and $4 million and no other debt?

[B]

Well, I do have some other debt.

[A]

How much? I mean, at that point.

[B]

Well, and that's one of my, one of my questions is do I, do I, because I'm self employed, I'm solely responsible for funding my 401k. So my question, one of my questions today is do I put more money towards my 401k or do I pay off My car notes pay off your.

[A]

Car, you pay off your car note, you stop putting money in retirement to get your car paid for. And then you quit borrowing money.

[B]

Quit what?

[A]

Quit borrowing money. Okay, okay, stop it. If you want to retire with dignity, okay? If you quit borrowing money, you pay your car off, and then you start your 401k and you make 300 grand, you're going to do it this year, okay? You're going to do it by Christmas, so it's not the end of the world. Pay it off fast, get done with it, and then systematically pay off your home. And I try to get my house paid off faster than your plan. I think your plan's a little weak, but either way, at nine years, you're gonna be sitting on $4 million or more in your mutual funds with a paid for house. Okay? Now if you invest that, continue to invest that at 11, and you were to pull off 8, and it grows by 11 every year until you die, you're gonna continue for it to grow by three because you're gonna consume eight. Eleven minus eight is three. You follow me?

[B]

Yeah.

[A]

Okay, so if you let it grow by 3 to cover some inflation, pull off 8. So 8 is going to be $240,000 a year.

[B]

Okay?

[A]

That's what $4 million at 8% is. And you're not even touching the 4 million. And you're growing it by 3% a year. And that's you in nine years. Okay, you're fine. But you got to execute this. You can't go screwing around. I'm doing a bunch of stupid stuff. But I mean, if you execute the plan that you already were on and we just tuned, that's where you'll be.

[B]

So you're saying to maybe not fund my 401k this year.

[A]

No, for two, for two or three months. How much do you own your stupid car?

[B]

On my car I owe 15 and on, and it's only one year old. So I've been. Because I pay extra. My car, I only owe 15, it's one year old. My nets at 4%. My son's car that I pay for is 11%.

[A]

How old is your son?

[B]

It's 11. He's, he's in college, he's 19. And so I still, and I have college tuition at about 25k a year.

[A]

You need to pay off these stupid cars and quit borrowing money. You have too much money coming in to be borrowing money on cars, particularly 11 freaking percent. Oh my God.

[B]

No, no, I'm sorry. It was $11,000 at 2.5%. I misspoke.

[A]

But car debt with your income and your net worth is just lazy. Okay, you know better.

[B]

Okay?

[A]

It's just, you know. You know better than that. Just clean that mess up. Okay.

[B]

So. So I can pay off. So take the money out of my savings account, pay off both these cars tomorrow.

[A]

Yeah, yeah. And then rebuild your savings account. And you probably can still do your 401k this year with money you make.

[B]

Yeah, I can find part of it, just maybe not the max. Right?

[A]

Yeah. But you're still going to be okay. You got nine more years, and you're going to get your house paid off now. And you're going to have $4 million. You're going to be living on a quarter million dollars a year. It's a pretty good situation. I'm not sure she heard you. She's still. She's still living in the present. And I already took her down there to nine years ago. I'm pretty comfortable at nine years. Yeah, I think that means her celebration. Yeah. But you got to execute all the way through. You got to keep going, do the whole thing and don't stop.