Dave Ramsey says 30 years Roth IRA to 1.3 million?

[thelateinvestor43]

He said that if you invest $6k to the Roth IRA over 30 years you could end up with 1.3 million. I've got 20 years till I'll be 67, so how much could I theoretically get investing $6k a year? I realize it won't be a million.

Hey it could end up being $5000 after 20 years right? Who knows ....

[JoeRetire]

Dave has been known to have unrealistic return expectations.

[fujiters]

Using a spreadsheet and an assumed 5% real rate of return (=FV(0.05,30,-6000,-6000)), I get ~$425k after 30 years. If we assume the historical real rate of return of the US stock market (many expect lower than this in at least the next decade due to higher P/E values now) of 7%, I get ~$612k.

[1789]

He makes up some numbers like 12% annual return. There is no such return even before taxes/inflation/distributions considered.

[Silk McCue]

Dave Ramsey is excellent for advice on getting out of debt, staying out debt, and living below your means. He is worthless when it comes to investing.

In order to achieve the figures you shared the annual return, year in and year out for those 30 years would be 11%. Let's not forget about the impacts of inflation on the purchasing power of those future dollars.

Dropping the return to 5% per year would give you around $208,000 in inflated dollars. Time to get saving.

Cheers

[Brianmcg321]

1.3mil would be if you achieved at least a 10% return.

However, that doesn’t account for inflation.

There are tons of investing calculators that you can play with. But when you do, use more conservative rates.

[Nate79]

Generally he is referring to one (without specifically naming) of a few of the American Funds whose return for 30+ years is from 10-12%.

[ChowYunPhat]

He said that if you invest $6k to the Roth IRA over 30 years you could end up with 1.3 million. I've got 20 years till I'll be 67, so how much could I theoretically get investing $6k a year? I realize it won't be a million.

Hey it could end up being $5000 after 20 years right? Who knows ....

If you are 47 today and have 20 years to reach 67 and invest the max into a Roth here are a few scenarios. For simplicity, I assumed your first investment in 2019 and gains compounded once annually.

• Low gross returns of 4% per year, and you invest $6K / yr until age 50 then $7K/yr thereafter. At age 67 you would have $202,000 and at age 77 you'd have $384,000

• Moderate gross returns of 8% per year, and you invest $6K / yr until age 50 then $7K/yr thereafter. At age 67 you would have $308,000 and at age 77 you'd have $767,000

• High gross returns of 12% per year, and you invest $6K / yr until age 50 then $7K/yr thereafter. At age 67 you would have $481,000 and at age 77 you'd have $1,617,000

For the latter 2 scenarios, you would need at least 80/20 of equities to debt in your portfolio. Depending on your draw down strategy this may not be best. I also assume you'd have earned income through age 77 which may not be likely but worth mentioning.

[nisiprius]

His calculation is probably assuming a much higher rate of return than is realistic. I'll get to that but first let's just see what the math is.

If we assume a return of 10.9% every year, contribute $6,000 at the start of every year, then at the end of 30 years we will have exactly $1.3 million. The assumptions that lead to $1.3 million after thirty years, also lead to $422,000 after twenty years.



I, like most Bogleheads, believe that Dave Ramsey sets expectations for investment results that are wildly optimistic, to the point of being irresponsible. I'll make a followup posting about that.

[Laker1]

Dave Ramsey is excellent for advice on getting out of debt, staying out debt, and living below your means. He is worthless when it comes to investing.

In order to achieve the figures you shared the annual return, year in and year out for those 30 years would be 11%. Let's not forget about the impacts of inflation on the purchasing power of those future dollars.

Dropping the return to 5% per year would give you around $208,000 in inflated dollars. Time to get saving.

Cheers

I went with one of Daves Endorsed Local Providers for a while, I paid the 1.5% management fees and after four years I found Mr Bogles teachings... Doing some simple math that ELD cost me about a lot of money for a lesser return than if I had done just basic 3 fund as I am working towards now. Dave is good at teaching people to pay HIM to learn how to get out of debt but as far as investing goes...well...just my 2 cents worth...and I would have had 3 cents had I become a Boglehead sooner.

[3funder]

Dave has been known to have unrealistic return expectations.

+1. I have $57,000 in my Roth IRA, and I plan on maxing it for the next 30 years. I can't imagine having a double-comma balance at that point in time.

[Olemiss540]

Dave is a motivational speaker with a specialty in personal finance. Consider any investing advice to be purely from a standpoint of trying to motivate wild over spenders to invest into the market instead of buying yet another consumer good. He was MMM (albeit a much less frugal version) before MMM existed.

And people getting worked up over optimistic investing returns as a mean to motivate debt laden people without much hope in financial freedom need to calm down a bit. Hopefully once these listeners are ready to take the reigns and become financially responsible (out of debt and with self control) they dig deeper into the world of INVESTMENTS and find this forum, the three fund portfolio, and take everything to the next level.

This was my path and I have read many others around here. 1. Debt and Consumerism. 2. Dave Ramsey. 3. Debt freedom 4. Bogle and Investing 5. Hopefully financial freedom!

[nisiprius]

[Added] I did not take account of the 5.75% sales load on American Fund in examples below, partly because I don't know how to do it. Can someone tell me: if you have an account with a typical financial advisor like Dave Ramsey's ELPs, once you've bought the account, do you need to pay that load when you add money to an existing fund you already own? And do these ELPs really have you buying class A shares or something else from the share-class alphabet soup?

To thelateinvestor43, you might have to knock 5.75% off all my numbers to account for the sales load. So, $314,000 from savings made over the past twenty years, $920,000 for thirty.

A contribution of $6,000 a year, into something resembling Dave Ramsey's recommended portfolio, starting in October 1999, would today have reached a total of $334,000. Notice that this means you put in $120,000 and now have $334,000 so you would have almost tripled your money.

This is the online tool I used, including the portfolio and dates and dollar numbers I used.





I, like most Bogleheads, think Dave Ramsey sets performance expectations that are wildly exaggerated and optimistic, to the point of being irresponsible.

From his website, we can see his general recommendation for the kind of investments he thinks his followers should make:

daveramsey.com, "How to Invest in the Right Mix of Mutual Fund"



This portfolio is 100% stocks, no bonds. There are some who agree with this--for young investors who are willing to take risk. The overwhelming consensus is that, twenty years from retirement a portfolio should include some bonds. I don't want to get into that here, except to say that I worry that Dave Ramsey's financial advice might be influenced by his personal beliefs. When you buy bonds, the issuer is in debt to you and pays interest to you, and he belongs to a personal tradition that in its strict from is opposed to paying interest on debt.

Dave Ramsey and his ELPs are often reported to favor American Funds, and American Funds has funds that clearly fall into each of these categories. It is my personal opinion that American Funds is a good fund family; whether you'd do better or worse with some other fund family would be pretty much chance. In choosing examples, I am going to look for American Funds that have at least thirty years of history; if I can't find one in one of those categories, I'll substitute some other company's fund.

I think this is a decent example of the kind of investment Dave Ramsey recommends.

For "international," EuroPacific Growth Fund, AEPGX
For "growth and income," The Investment Company of America, AIVSX
For "aggressive growth," The New Economy Fund, ANEFX
For "growth," The Growth Fund of America, AGTHX

We can explore this with a no-cost online tool called PortfolioVisualizer. We can start here.

Over the past twenty years, this portfolio has averaged (CAGR) 7.23%, far short of the 10.9% needed to make Dave Ramsey's numbers work. As you get to understand the math of compounding, you'll understand that 7.23% is not a small shortfall, it's missing by a mile. To put it another way, over the past 20 year his portfolio has gone 72 miles per hour, yet you should expect that you will be able to go 109 miles per hour.

Over the past thirty years, this portfolio has averaged 9.84% per year, which is not all that far off.

Now, for a contribution of $6,000 a year to this actual portfolio, starting 30 years (October 1989), would have resulted in a final total of $1.05 million, which in my opinion is not bad, not too far off the "$1.3 million" mark.

[Herekittykitty]

nisiprius, thanks for the figures, graphics, and explanation all of which are instructive and helpful.

I missed whether the numbers are before or after commission. Can you clarify that for me?

[cykj]

Over the past twenty years, this portfolio has averaged (CAGR) 7.23%, far short of the 10.9% needed to make Dave Ramsey's numbers work. As you get to understand the math of compounding, you'll understand that 7.23% is not a small shortfall, it's missing by a mile. To put it another way, over the past 20 year his portfolio has gone 72 miles per hour, yet you should expect that you will be able to go 109 miles per hour.

Over the past thirty years, this portfolio has averaged 9.84% per year, which is not all that far off.

Now, for a contribution of $6,000 a year to this actual portfolio, starting 30 years (October 1989), would have resulted in a final total of $1.05 million, which in my opinion is not bad, not too far off the "$1.3 million" mark.

Does this math also account for the 5.75% front load?

[mptfan]

Using a spreadsheet and an assumed 5% real rate of return (=FV(0.05,30,-6000,-6000)), I get ~$425k after 30 years. If we assume the historical real rate of return of the US stock market (many expect lower than this in at least the next decade due to higher P/E values now) of 7%, I get ~$612k.

You are using the historical real rate of return but you should use the historical nominal rate of return of 10%. Dave Ramsey was referring to the future nominal value, not the future real value, and almost everyone who refers to how much you can expect to have in the future based on past investment performance refers to nominal values.

[nisiprius]

Over the past twenty years, this portfolio has averaged (CAGR) 7.23%, far short of the 10.9% needed to make Dave Ramsey's numbers work. As you get to understand the math of compounding, you'll understand that 7.23% is not a small shortfall, it's missing by a mile. To put it another way, over the past 20 year his portfolio has gone 72 miles per hour, yet you should expect that you will be able to go 109 miles per hour.

Over the past thirty years, this portfolio has averaged 9.84% per year, which is not all that far off.

Now, for a contribution of $6,000 a year to this actual portfolio, starting 30 years (October 1989), would have resulted in a final total of $1.05 million, which in my opinion is not bad, not too far off the "$1.3 million" mark.

Does this math also account for the 5.75% front load?

No, it doesn't. Good point. But how does that work, exactly? Once you've bought the funds, do you still pay a load every time you add to them?

[Stinky]

I, like most Bogleheads, believe that Dave Ramsey sets expectations for investment results that are wildly optimistic, to the point of being irresponsible.

I fully agree with this.

Dave Ramsey has done a lot of good things for a lot of people. His advice about keeping a household budget, spending less than you earn, getting out of debt and staying out of debt, are very good for a large part of the population. It can be inspiring to hear someone scream "I'm debt free", because it means so much to that person.

Dave calls his method of getting out debt "the baby steps". That's how I'd think about his advice on investing - just the very first steps. Spending less than you earn is so important. But his advice about the 12% return available on mutual funds, and his incessant pitches for his network of financial advisors, mislead the baby-step investors so badly.

Hopefully those baby investors can grow up and become Bogleheads some day.

[Jags4186]

[Added] I did not take account of the 5.75% sales load on American Fund in examples below, partly because I don't know how to do it. Can someone tell me: if you have an account with a typical financial advisor like Dave Ramsey's ELPs, once you've bought the account, do you need to pay that load when you add money to an existing fund you already own? And do these ELPs really have you buying class A shares or something else from the share-class alphabet soup?

To thelateinvestor43, you might have to knock 5.75% off all my numbers to account for the sales load. So, $314,000 from savings made over the past twenty years, $920,000 for thirty.

To account for the load you simply need to reduce the contribution amount by the load. The money is taken upfront.

So if your initial investment is $10,000 you should put into PV $9,425 initial investment. If you’re contributing $1000/mo, you should instead contribute $942.50/mo. To figure out what the loads have cost you, run the same calculation except with $575 as the initial contribution and $57.50 as your monthly contribution.

I do not know at what point that 5.75% is reduced. I am assuming someone with $1,000,000 balance pays a smaller load than someone with a $10,000 account but of course I could be wrong. Additionally, there are all no load versions of these funds (through Schwab I believe) so if an investor here wishes to duplicate this portfolio without the load it is possible.

Also I should note that over the 30 year period November 1989 - Oct 2019 the portfolio you show would have gotten you to $996,358 if you had invested $6000 annually, accounting for the load and assuming you’re in a tax advantaged account.

Of course the same $6000 annually with no load in the SP500 would have gotten you to $1,019,315.

[LadyGeek]

This thread is now in the Investing - Theory, News & General forum (general question).

[CyclingDuo]

I, like most Bogleheads, believe that Dave Ramsey sets expectations for investment results that are wildly optimistic, to the point of being irresponsible.

I fully agree with this.

Dave Ramsey has done a lot of good things for a lot of people. His advice about keeping a household budget, spending less than you earn, getting out of debt and staying out of debt, are very good for a large part of the population. It can be inspiring to hear someone scream "I'm debt free", because it means so much to that person.

Dave calls his method of getting out debt "the baby steps". That's how I'd think about his advice on investing - just the very first steps. Spending less than you earn is so important. But his advice about the 12% return available on mutual funds, and his incessant pitches for his network of financial advisors, mislead the baby-step investors so badly.

Hopefully those baby investors can grow up and become Bogleheads some day.

We much prefer the advice from Jonathan Clements and other studies that point to our savings rate being more crucial than ROI:

That brings us to a perverse conclusion—one I’m almost reluctant to mention: Because savings are so crucial, and because they’re the key driver of your ultimate nest egg, how you invest is somewhat less important. - Jonathan Clements

https://www.marketwatch.com/story/here- ... 2017-07-20

“Clearly, savings seems to trump investing returns for the average American household. This is good news, for saving more is something you actually can control, whereas earning a higher rate of return is infinitesimally more difficult,” Bilello said in a blog post.

https://sparkrental.com/roi-savings-rate-new-study/

How much you save makes a far greater impact on your end balance than your ROI.

[whodidntante]

Dave Ramsey is excellent for advice on getting out of debt, staying out debt, and living below your means. He is worthless when it comes to investing.

I think his advice on use of credit is also awful. He doesn't teach people responsible use of credit. He teaches to avoid use of credit like a drunk avoiding a drink. This can result in a counterproductive lack of long term investment and a needless lack of liquidity. Following his advice leads to worse outcomes in my opinion.

[rascott]

Generally he is referring to one (without specifically naming) of a few of the American Funds whose return for 30+ years is from 10-12%.

AGTHX

To be fair... he has always recommended growth funds. And he's been right/ lucky that growth has beaten value for a long time running.


Dave's advice isn't really geared towards people on this site.... but instead the huge masses of the population that operate their lives in financial wastelands. His advice is much more behavioral than mathematical.... he even admits as much. It may be sub- optimal.... but following it would exponentially improve the lives of most of his listeners.

[Brianmcg321]

Dave Ramsey is excellent for advice on getting out of debt, staying out debt, and living below your means. He is worthless when it comes to investing.

I think his advice on use of credit is also awful. He doesn't teach people responsible use of credit. He teaches to avoid use of credit like a drunk avoiding a drink. This can result in a counterproductive lack of long term investment and a needless lack of liquidity. Following his advice leads to worse outcomes in my opinion.

That's ridiculous. Worse than what? People getting out of hundreds of thousands in debt, paying off their mortgage, and becoming millionaires. You think that's a worse outcome than the situation they were in?

[rascott]

Dave Ramsey is excellent for advice on getting out of debt, staying out debt, and living below your means. He is worthless when it comes to investing.

I think his advice on use of credit is also awful. He doesn't teach people responsible use of credit. He teaches to avoid use of credit like a drunk avoiding a drink. This can result in a counterproductive lack of long term investment and a needless lack of liquidity. Following his advice leads to worse outcomes in my opinion.

Most of the folks that seem to call in would be proverbial drunk that needs to avoid debt entirely.

[awval999]

Dave Ramsey is excellent for advice on getting out of debt, staying out debt, and living below your means. He is worthless when it comes to investing.

I think his advice on use of credit is also awful. He doesn't teach people responsible use of credit. He teaches to avoid use of credit like a drunk avoiding a drink. This can result in a counterproductive lack of long term investment and a needless lack of liquidity. Following his advice leads to worse outcomes in my opinion.

Have you ever listened to his show?

The majority of the callers are financial drunks. Offering samples of the finest Scotch to a group of recovering alcoholics leaving an AA meeting is irresponsible.

[Grt2bOutdoors]

What is your risk tolerance? The numbers quoted by Dave assume you are 100 percent invested solely in equities. Can you handle watching your account value fall by half on any one given day? If you can not, then don’t plan on 1.3 million. A more approximate value could be anywhere from $200k to $400k, give or take a few thousand.

[LadyGeek]

FYI - The OP has a thread here: How do I add more money to a mutual fund in Fidelity?

I also fixed the capitalization in the thread title "Ira" to "IRA".

[JoeRetire]

It may be sub- optimal.... but following it would exponentially improve the lives of most of his listeners.

Doing almost anything would exponentially improve the lives of most of his listeners.

Rice and Beans... Beans and Rice.

[student]

Like many others here, I also find his investing advice irresponsible. I do watch his youtube video for entertainment but I turn it off when he starts talking about investment or bashing credit cards.

[student]

It may be sub- optimal.... but following it would exponentially improve the lives of most of his listeners.

Doing almost anything would exponentially improve the lives of most of his listeners.

Rice and Beans... Beans and Rice.

lol. And the only time you see the inside of a restaurant is if you work in one. I don't understand why people call when they already (or should) know his answers.

[rascott]

What is your risk tolerance? The numbers quoted by Dave assume you are 100 percent invested solely in equities. Can you handle watching your account value fall by half on any one given day? If you can not, then don’t plan on 1.3 million. A more approximate value could be anywhere from $200k to $400k, give or take a few thousand.

Fall by half in one day? Uh no.

[JoeRetire]

I don't understand why people call when they already (or should) know his answers.

Many people crave confirmation.

It's no different than here at Bogleheads or many online forums. People want attention, confirmation, and a sense that they belong.

[CyclingDuo]

What is your risk tolerance? The numbers quoted by Dave assume you are 100 percent invested solely in equities. Can you handle watching your account value fall by half on any one given day?

Let's not be overly dramatic. A 50% decline in one given day?

The Dow's largest one day drops in history...



The S&P 500's largest one day drops...

[rascott]

$6k per year for the last 30 years would have resulted in $1.7m in one of Dave's favorite funds.

And $1.3m in a SP500 index. Assuming this is the basis of his argument.

https://www.portfoliovisualizer.com/bac ... ion1_1=100

[whodidntante]

Dave Ramsey is excellent for advice on getting out of debt, staying out debt, and living below your means. He is worthless when it comes to investing.

I think his advice on use of credit is also awful. He doesn't teach people responsible use of credit. He teaches to avoid use of credit like a drunk avoiding a drink. This can result in a counterproductive lack of long term investment and a needless lack of liquidity. Following his advice leads to worse outcomes in my opinion.

That's ridiculous. Worse than what? People getting out of hundreds of thousands in debt, paying off their mortgage, and becoming millionaires. You think that's a worse outcome than the situation they were in?

My point is that responsible use of credit leads to greater wealth and greater liquidity than avoidance of credit. If you waste hundreds of thousands of dollars on cars and spend like a rock star on your credit cards, that is not a responsible use of credit.

[JoeRetire]

What is your risk tolerance? The numbers quoted by Dave assume you are 100 percent invested solely in equities. Can you handle watching your account value fall by half on any one given day? If you can not, then don’t plan on 1.3 million. A more approximate value could be anywhere from $200k to $400k, give or take a few thousand.

Fall by half in one day? Uh no.

Okay, 22.6%

Is that better?

[H-Town]

He said that if you invest $6k to the Roth IRA over 30 years you could end up with 1.3 million. I've got 20 years till I'll be 67, so how much could I theoretically get investing $6k a year? I realize it won't be a million.

Hey it could end up being $5000 after 20 years right? Who knows ....

According to his logic, with my current saving rate, I would end up with.... (click, click, click)... $20 million. Am I supposed to pop champagne now? Not really.

Life events happen. I’m thankful to be able to make money and save this year and the past years. I take one year at a time.

Dave Ramsey is wrong. He knows that he’s wrong and he’s still giving such advice. I believe his intention is to get his followers to get out of debt and save, even with lies and misinformation.

[abuss368]

Using a spreadsheet and an assumed 5% real rate of return (=FV(0.05,30,-6000,-6000)), I get ~$425k after 30 years. If we assume the historical real rate of return of the US stock market (many expect lower than this in at least the next decade due to higher P/E values now) of 7%, I get ~$612k.

This is assuming $6,000 is deposited every year for 30 years correct?

[rascott]

What is your risk tolerance? The numbers quoted by Dave assume you are 100 percent invested solely in equities. Can you handle watching your account value fall by half on any one given day? If you can not, then don’t plan on 1.3 million. A more approximate value could be anywhere from $200k to $400k, give or take a few thousand.

Fall by half in one day? Uh no.

Okay, 22.6%

Is that better?

That's not even possible today with circuit breakers.

[abuss368]

$6k per year for the last 30 years would have resulted in $1.7m in one of Dave's favorite funds.

And $1.3m in a SP500 index. Assuming this is the basis of his argument.

https://www.portfoliovisualizer.com/bac ... ion1_1=100

That is interesting. I would have expected $6,000 a year over 30 years would compound close to $1M.

[abuss368]

With something this simple - $6,000 a year, in a simple but effective S&P 500 or Total Stock fund - it simply works.

It begs the question as to why carve that up into many different funds and complexity - small cap, REITs, international. Keep investing simple.

[nisiprius]

What is your risk tolerance? The numbers quoted by Dave assume you are 100 percent invested solely in equities. Can you handle watching your account value fall by half on any one given day? If you can not, then don’t plan on 1.3 million. A more approximate value could be anywhere from $200k to $400k, give or take a few thousand.

Fall by half in one day? Uh no.

Okay, 22.6%
Is that better?

That's not even possible today with circuit breakers.

"Don't treat the highly improbable as impossible, nor the highly likely as certain."--Larry Swedroe.



Would you have have said this was "possible" before it happened? This chart is for RSP, which is the only chart I can find, but VTI was affected as well, briefly having a market price of $0.13/share, i.e. much more than a 50% loss. As far as I can remember, nobody in the forum has ever reported personally losing any money in the flash crash. But I'm not sure I can remember anybody saying they'd personally lost 22.6% in 1987, either. The point is that the circuit breakers did not prevent the flash crash.

By all means explain the circuit breakers, but don't say they've made anything "impossible."

[JoeRetire]

What is your risk tolerance? The numbers quoted by Dave assume you are 100 percent invested solely in equities. Can you handle watching your account value fall by half on any one given day? If you can not, then don’t plan on 1.3 million. A more approximate value could be anywhere from $200k to $400k, give or take a few thousand.

Fall by half in one day? Uh no.

Okay, 22.6%

Is that better?

That's not even possible today with circuit breakers.

(sigh)

Okay, the point was clearly "Can you handle watching your account value fall by half over a rather short period of time?"

Cue anyone who wants to jump in and parse the sentence. Your turn.

[Grt2bOutdoors]

Dave's advice isn't really geared towards people on this site.... but instead the huge masses of the population that operate their lives in financial wastelands. His advice is much more behavioral than mathematical.... he even admits as much. It may be sub- optimal.... but following it would exponentially improve the lives of most of his listeners.

I agree with this. His advice is directed to a subset of the population who are not financially savvy, have had no guidance in the past or present. For budgeting and spending his advice is good.

[student]

I don't understand why people call when they already (or should) know his answers.

Many people crave confirmation.

It's no different than here at Bogleheads or many online forums. People want attention, confirmation, and a sense that they belong.

My fault. I wasn't clear. I was thinking more about those who call and expect Dave to give them a different answer.

[Grt2bOutdoors]

What is your risk tolerance? The numbers quoted by Dave assume you are 100 percent invested solely in equities. Can you handle watching your account value fall by half on any one given day?

Let's not be overly dramatic. A 50% decline in one given day?

The Dow's largest one day drops in history...



The S&P 500's largest one day drops...

What about intra-day? You are showing end of day. Those holding ETFs can trade at any time when the markets are open for business. The flash crash showed what happened in the course of trading hours and it wasn’t pretty. All you need are a couple of people get nervous and then come the statements “lost my money in the crash” etc.

[student]

Dave Ramsey is excellent for advice on getting out of debt, staying out debt, and living below your means. He is worthless when it comes to investing.

I think his advice on use of credit is also awful. He doesn't teach people responsible use of credit. He teaches to avoid use of credit like a drunk avoiding a drink. This can result in a counterproductive lack of long term investment and a needless lack of liquidity. Following his advice leads to worse outcomes in my opinion.

That's ridiculous. Worse than what? People getting out of hundreds of thousands in debt, paying off their mortgage, and becoming millionaires. You think that's a worse outcome than the situation they were in?

My point is that responsible use of credit leads to greater wealth and greater liquidity than avoidance of credit. If you waste hundreds of thousands of dollars on cars and spend like a rock star on your credit cards, that is not a responsible use of credit.

+1.

[JoeRetire]

I don't understand why people call when they already (or should) know his answers.

Many people crave confirmation.

It's no different than here at Bogleheads or many online forums. People want attention, confirmation, and a sense that they belong.

My fault. I wasn't clear. I was thinking more about those who call and expect Dave to give them a different answer.

Okay. I haven't listened enough to have heard anyone call expecting some sort of non-Dave answer.
Everyone I heard was looking for the exact gospel that Dave preaches.
I only listened to a few shows.

[danaht]

You could contribute $6,000 and then convert $6,000 more from a traditional IRA and that will give you a better chance. The conversion will only cost you ~$1,300 if you are in the 22% tax bracket, or $720, if you are in the 12% bracket. Of course - you can only convert if you have traditional IRA (or 401k) account with something in it. If you don't - you can always just contribute to a Roth 401k instead - if your employer offers that option. Just be careful with conversions or Roth 401k contributions if you are trying to keep your income low to qualify for a Healthcare insurance subsidy (or any other low income subsidy)