Dave Ramsey’s Advice to Take Social Security at 62

Dave Ramsey is known for bold, straightforward financial advice, and few of his positions spark more debate than his view on Social Security. Most financial experts recommend delaying benefits as long as possible to maximize monthly payments. Ramsey pushes back hard, arguing that most people are better off claiming as early as age 62 and immediately putting those checks 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 has real merit, but it also carries meaningful risks and requires trade-offs most people overlook. Here is a closer look at Ramsey’s reasoning, how the math actually works, and whether his strategy 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. His recommendation is to start payments at 62 and immediately channel every dollar 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, pointing to expected annual returns of 10% to 12% from diversified mutual funds as justification.

His second argument is equally direct: 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, noting 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, full retirement age (FRA) is 67, and filing at 62 triggers a 30% permanent reduction in monthly benefits. In 2026, that translates to a maximum monthly check of $2,969 at age 62, compared to $4,152 at FRA and $5,181 for those who wait until 70. The flip side of claiming early: you collect checks for five more years before a delayed claimer sees their first dollar, and 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, a strong and guaranteed return. Ramsey’s counterpoint is that this guaranteed growth has a ceiling, while a broad equity portfolio theoretically does not. Many diversified mutual funds and ETFs have historically outpaced that 8% annualized return, though past performance carries no guarantee of future results.

Social Security’s Cost of Living Adjustments (COLAs) are designed to help benefits keep pace with inflation, 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 since 2016 because COLAs have not kept up with real-world inflation. Recovering that lost value would require a 15.7% across-the-board increase, which for the average beneficiary amounts to roughly $296 per month.

The inflation picture adds fresh urgency to this debate. After July CPI-W data came in at 3.4% year-over-year, the Senior Citizens League revised its 2027 COLA projection to 3.6%, and independent Social Security analyst Mary Johnson revised her estimate to 3.4%. Both figures are still well above this year’s 2.8% adjustment, and either would represent the largest increase since 2023. Both forecasts remain subject to change, as the Social Security Administration will base the official COLA on third-quarter 2026 inflation data, with an announcement scheduled for October 2026. A higher COLA delivers guaranteed, inflation-adjusted growth on a larger baseline check for those who delay. Claim at 62, and that same percentage 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

The Social Security Administration’s 2026 Trustees Report, released June 9, 2026, projects that OASI Trust Fund reserves will be depleted in the fourth quarter of 2032, one quarter earlier than the 2025 report projected. At that point, Social Security will only be able to pay 78% of retirement benefits from ongoing payroll revenue, translating to a roughly 22% automatic benefit cut. If the OASI and Disability Insurance trust funds were merged, the combined fund would hold out until the third quarter of 2034, at which point 83% of scheduled benefits would be payable. The accelerated OASI timeline reflects revised fertility and immigration projections, along with the One Big Beautiful Bill Act, which reduced income taxes on Social Security benefits and lowered trust fund revenues, and the Social Security Fairness Act, which repealed the Windfall Elimination Provision and Government Pension Offset and increased the program’s outlays. The Bipartisan Policy Center notes the program’s long-run 75-year funding shortfall now stands at approximately $30 trillion, up from roughly $26 trillion in last year’s report.

Policymakers are 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 it calls the “Six-Figure Limit,” to 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 mid-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 depends on several factors that are far from guaranteed. Market performance is the most obvious variable: returns are volatile, especially over shorter timeframes. A retiree who claims at 62 and immediately encounters a prolonged market downturn may see this approach badly underperform a simple decision to delay. The strategy also demands behavioral discipline. Every check must be routed into investments rather than spent on monthly expenses, which is far easier to plan than to execute.

A less-discussed obstacle is the Social Security earnings test. In 2026, anyone under full retirement age who earns more than $24,480 from work will have $1 withheld in benefits for every $2 earned 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 independently, while investing the Social Security income on the side. That is a prerequisite many 62-year-olds do not meet. The TSCL’s 2026 Senior Survey underscores how much the stakes have risen: 44% of retirees now depend on Social Security for all of their income, up from 39% in 2025, which means a bad market bet hits hardest for those who can least afford it.

Many retirees treat Social Security as a bet on their own lifespan, fixating on “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 steered people toward early claiming. Financial planners warn that focusing on break-even math misses the program’s core value: longevity insurance against the risk of outliving your savings. A larger monthly check at 80 or 85 is often worth far more than years of smaller payments that run dry too soon.

Ramsey’s approach works best for retirees who are genuinely done working, have a disciplined investment plan in place, and can commit to deploying every Social Security check into the market rather than spending it. For the majority of Americans, the case for delaying remains the more practical and resilient choice, even if it is less exciting on paper.

Editor’s note: The 2027 Social Security COLA projections in this article were updated to reflect revised estimates released after July 2026 CPI-W data: the Senior Citizens League now projects 3.6% and independent analyst Mary Johnson now projects 3.4%, both down from earlier forecasts cited in a prior version. The article also added 2026 monthly benefit maximums at ages 62, 67, and 70 to illustrate the concrete dollar stakes of the claiming decision.

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