Dave Ramsey’s Baby Step #4 – Invest 15% of your income into retirement savings
By this time you have paid off your debt except for the house and you have a fully funded emergency fund with 3-6 months of expenses in the unfortunate event that something catastrophic happened. Now it is time to start planning for the future and putting 15% of your household income into a pre-tax retirement account such as a company 401k or IRA.
Dave Ramsey has a really neat calculator here
that lets you figure out how much you need to invest and what the value of it will be when you retire. Play around with the numbers and you will be amazed on how compounding interest is going to be your friend!