Personal finance host Dave Ramsey is urging retirees to claim Social Security at 62, not 70, arguing that waiting carries too much risk and cost. He made the case that claiming early and investing the checks could produce more wealth than holding out for a larger monthly benefit. His stance challenges a common rule of thumb that favors delaying to secure a bigger payout later.
I set out to weigh his argument against standard retirement advice and the realities facing older workers. The debate hits home for millions approaching retirement decisions in a period of higher interest rates, mixed markets, and rising life expectancy for some, but not for all.
What Ramsey Said and Why It Matters
“Claim Social Security at 62 instead of 70 due to longevity risk and opportunity cost.”
“Investing benefits claimed at 62 could yield more wealth than waiting for larger monthly checks at 70.”
Ramsey’s position centers on two ideas. First, older Americans face longevity risk in both directions: some will live long and benefit from larger checks, while others may not reach the break-even point. Second, he argues the money collected at 62 can be put to work in markets, potentially beating the value of the larger delayed benefit.
I’ve heard this pitch from advisers when interest rates are higher and stocks have delivered strong returns. The logic is simple: take cash sooner, invest it, and let compounding do the work.
The Standard Playbook: Delay if You Can
Many retirement planners still favor waiting, especially for those in good health and with long-lived parents. Social Security increases your monthly benefit for each year you delay past full retirement age (now 66 to 67 for most), up to 70. The increase is about 8% per year after full retirement age. Claiming at 62 can reduce benefits by roughly 25% to 30% compared with waiting until full retirement age.
Delaying also functions like a form of guaranteed lifetime income. That can help in late life when investment risk feels heavier and medical costs rise. Spousal and survivor benefits can make the case for delay even stronger for the higher earner in a couple.
The Investment Bet Behind Claiming Early
Ramsey’s view leans on market returns outpacing the value of delay. In years when equities perform well, that can be true. But markets are not guaranteed. Sequence risk—the chance that early returns are weak—can undercut the strategy, especially if withdrawals are needed during a downturn.
I asked planners who model both choices what tips the scales. Assumptions drive outcomes. A realistic rate of return, taxes on benefits, and a person’s expected lifespan change the answer. If you invest early checks at a modest rate after fees and taxes, the advantage over delay can shrink.
Who Might Benefit From Claiming at 62
There are clear cases where claiming early can fit:
- Shorter life expectancy due to health or family history.
- Lack of savings or need to reduce portfolio withdrawals.
- High debt costs where checks can retire expensive loans.
- Single individuals without a spouse relying on survivor benefits.
Ramsey’s point about opportunity cost resonates for people carrying credit card balances or facing unstable work in their 60s. For them, cash flow now can be more valuable than higher payments later.
When Waiting Still Makes Sense
There are also strong reasons to delay:
- You expect to live into your late 80s or 90s.
- You are the higher earner in a couple, boosting a survivor’s future income.
- You want more guaranteed income to reduce market risk later in life.
- You plan to keep working past 62 and would face the earnings test.
Working while claiming before full retirement age can reduce current benefits due to the earnings test. That money is not lost forever, but timing matters. Taxes also matter: up to 85% of benefits can be taxable based on other income.
The Break-Even Lens
Advisers often use a break-even age to compare choices. If you live past roughly your late 70s to early 80s, delaying can pay off. If not, claiming early can win. Ramsey’s message pushes back on betting your plan on living well past that point when markets may offer gains now. The middle ground is coordinating claims within households, blending withdrawals and partial delays, or using early checks to fund Roth conversions that improve taxes later.
I see the real takeaway as this: the “right” answer depends on health, work, savings, and risk tolerance, not a single rule. A spreadsheet can guide, but life circumstances decide.
Ramsey’s focus on opportunity cost puts pressure on the default advice to delay. For some, it will unlock a plan that feels more secure today. For others, the steady increase from waiting remains the safer bet. The next step is to run your numbers with realistic returns and taxes, weigh survivor needs, and decide how much late-life income you want guaranteed.
