Dave Ramsey is known for offering bold, straightforward financial advice. His positions often challenge conventional wisdom, and few generate more debate than his view on Social Security. While most financial experts recommend delaying benefits as long as possible to maximize monthly payments, Ramsey has argued that most people are better off claiming as early as age 62 and putting that money to work in the market.
His approach centers on the idea that consistent, disciplined investing can outperform the guaranteed increases that come with waiting. That argument is not without merit, but it also carries real risks and trade-offs. Here is a closer look at Ramsey’s advice, how it works, and whether it fits your situation.
Ramsey says you should claim Social Security early for one key reason
Ramsey does not believe you should grab your Social Security check at the youngest possible age and simply spend it. Instead, his recommendation is to start payments at 62 and immediately channel the money into a diversified mutual fund. He argues that investing those early checks in the stock market beats leaving money on the table while waiting for a larger benefit, citing expected annual returns of 10% to 12% from diversified mutual funds as justification.
His second argument is straightforward: your benefits stop when you die, so collecting earlier means more total payments if your lifespan is average or shorter. Ramsey has made this case on podcasts and on the Ramsey Solutions blog, where he has written that benefits die when you die, so you might as well collect and invest them while you can.
Why Ramsey may be right
Claiming early and investing creates a compounding effect that a delayed, guaranteed benefit cannot easily replicate. For anyone born in 1960 or later whose full retirement age (FRA) is 67, filing at 62 triggers a 30% permanent reduction in monthly benefits. The flip side is that you collect checks for five more years before a delayed claimer sees their first dollar. If those early payments go straight into a well-managed equity fund, the growth potential is real.
When you delay beyond FRA, your benefit grows by roughly 8% annually until age 70, which is a strong, guaranteed return. But Ramsey’s point is that this guaranteed growth has a ceiling, while a broad equity portfolio theoretically does not. There are plenty of diversified mutual funds and ETFs that have historically outpaced that 8% annualized return, though past performance carries no guarantee of future results.
Social Security’s Cost of Living Adjustments (COLAs), designed to help benefits keep pace with inflation, are calculated using the CPI-W index. That formula underweights the costs that hit retirees hardest: healthcare, housing, and utilities. According to the Senior Citizens League’s 2026 Loss of Buying Power study, benefits have lost 13.7% of their buying power due to COLAs that have not kept up with real-world inflation. Benefits would need to rise by 15.7% across the board to recover the lost value, which for the average beneficiary amounts to $295.85 per month.
The inflation picture adds new urgency to this debate. With inflation surging above 4%, the Senior Citizens League now predicts a 3.8% Social Security COLA for 2027, which would be a full percentage point above this year’s 2.8% adjustment. The Iran war’s pressure on oil and gas prices has pushed overall inflation to its highest level since April 2023, which means beneficiaries will need a bigger boost to their benefits next year. A higher COLA does mean guaranteed, inflation-adjusted growth on a larger baseline check if you delay. If you claim at 62, that percentage increase applies to a permanently shrunken benefit, making it harder for investment returns to close the gap over time.
The solvency crisis and proposed benefit caps
According to the Social Security Administration’s own 2026 Trustees Report, released June 9, 2026, the OASI Trust Fund reserves are projected to become depleted in the fourth quarter of 2032, one quarter earlier than the 2025 report projected. If the fund depletes as projected, Social Security will only be able to pay 78% of retirement benefits from ongoing payroll revenue, translating to roughly a 22% automatic benefit cut. This timeline has already moved up from the CBO’s earlier warning, driven in part by the passage of the One Big Beautiful Bill Act and the Social Security Fairness Act, both of which increased the program’s costs.
Policymakers are now debating structural fixes, including one proposal that is particularly relevant to high earners. The Committee for a Responsible Federal Budget (CRFB) has proposed capping maximum benefits at $100,000 for couples and $50,000 for individuals, a plan dubbed the “Six-Figure Limit,” to help slow the growth of payments to the wealthiest retirees. Applying a $100,000 cap on couples’ benefits and indexing that limit to inflation would save an estimated $100 billion over 10 years and close about one-fifth of Social Security’s 75-year solvency gap, according to the CRFB. As of April 2026, neither Congress nor the Social Security Administration has scheduled hearings or votes on this proposal, making immediate implementation unlikely. Still, for high earners who could face future means-testing or benefit caps, Ramsey’s case for claiming early and investing independently carries added weight.
Understand the risks of investing your benefits
Ramsey’s strategy of claiming early and investing the money depends on several factors that are far from guaranteed. Market performance is the most obvious: returns are volatile, especially over shorter timeframes, and a retiree who claims at 62 and immediately encounters a prolonged downturn may see this plan underperform a simple decision to delay. The strategy also demands behavioral discipline. You must consistently route each check into investments rather than spending it, which is easy to say and harder to do when bills arrive.
A less-discussed obstacle is the Social Security earnings test. For anyone who is still working at 62, the earnings test creates a direct conflict: in 2026, if you are under full retirement age and earn more than $24,480 from work, Social Security withholds $1 in benefits for every $2 you earn above that threshold. To execute Ramsey’s strategy as described, you generally need to be fully retired at 62 and have enough in savings to cover living expenses while investing the Social Security income. That is a prerequisite many 62-year-olds do not meet.
Many retirees also treat Social Security as a bet on their own lifespan, obsessing over “break-even” math. According to AARP, the break-even point for claiming at 62 versus FRA is 78 years and 8 months, while the break-even for waiting until 70 is 82 years and 6 months. The Social Security Administration discontinued its online break-even calculator precisely because it frequently pushed people toward early claiming. Financial planners warn that running this math at all misses the program’s core value: longevity insurance against the risk of outliving your savings. A larger check at 80 or 85 is often worth more than years of smaller ones that run out too soon.
Ultimately, Ramsey’s approach works best for retirees who are genuinely done working, have a solid investment plan, and can commit to deploying every check into the market rather than spending it. For everyone else, the case for delaying, while less exciting, is often more practical.
Editor’s note: This article was updated to reflect the Social Security Administration’s 2026 Trustees Report (released June 9, 2026), which moved the OASI trust fund depletion date to Q4 2032 and projected a 22% benefit cut at that point; the Senior Citizens League’s latest 2027 COLA forecast of 3.8%, up from 3.9% cited in a prior version; and details on the Social Security earnings test limit of $24,480 in 2026, which affects the practicality of Ramsey’s strategy for people still working at 62.
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