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Dave Ramsey recently told Kiplinger that retiring at 62 — the age millions of Americans actually leave work — is one of the biggest money mistakes you can make. His words: it’s “like jumping out of a plane without checking your parachute” (1).
I’ve been a CPA since 1981, and I’ve run these numbers for more people than I can count. So let me say something I rarely say about a finance influencer: on the core math, Ramsey’s mostly right.
Claim Social Security at 62 with a full retirement age of 67 and you take a permanent 30% cut to your monthly check (2). Retire before 65 and you’re buying your own health insurance until Medicare starts — and Fidelity figures a 65-year-old will spend around $172,500 on health care in retirement, about $345,000 for a couple, before any long-term care (3).
The average American already retires around 63, three years before Medicare even kicks in (4).
But “mostly right” isn’t “always right.” Here’s the math behind why his parachute warning holds up — and the three situations where retiring at 62 is the right move and he’s dead wrong.
1. He’s right that you’ll probably live longer than you think
Ramsey’s core point is that people underestimate two things: how long they’ll live, and how much they’ll need (1).
The real danger of starting at 62 isn’t dying too soon. It’s living a long time on too little. A retirement that starts at 62 might have to stretch across 30 years.
That’s three decades of inflation, market dips, and surprise expenses — funded by a paycheck that stopped early.
Plan for the long life, not the short one.
2. He’s right that claiming at 62 locks in a permanent pay cut
This is the one I’d underline twice. The 30% reduction for claiming at 62 isn’t temporary — it follows you for life (2). Wait past full retirement age and the SSA adds roughly 8% a year up to 70 (2).
The instinct to grab benefits early, before they’re “cut,” is usually the costliest move of all. I nearly tripped over a couple of these traps myself when I filed for my own benefits.
This is the single decision most worth getting right — and the easiest to botch alone.
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3. He’s right that the years before Medicare are brutal
Retire at 62 and you’ve got about three years to cover before Medicare starts at 65 (4). You’ll be buying private coverage at one of the most expensive ages there is — and health costs are the line item that quietly wrecks early-retirement budgets ($172,500 for a single retiree, $345,000 for a couple, before long-term care) (3).
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4. Where he’s wrong #1: when 62 isn’t a choice
Ramsey adds a caveat to his own warning — it’s aimed at people who choose to retire early, not those forced out (1). But a huge share of early retirements aren’t chosen. Layoffs, a health scare, or caring for a spouse can end a career years before you planned.
If you’re pushed out at 62, the math doesn’t care about ideals — you need income now. And for a homeowner who’s house-rich but cash-poor, home equity is one bridge worth understanding, as long as you go in with eyes open. It isn’t right for everyone.
If you’re 62 or older, the equity in your home could become cash you can use now. A reverse mortgage lets eligible homeowners convert part of their home equity into funds — while keeping ownership of their home.
What it could help you do:
- Free up your monthly budget with no required monthly mortgage payment*
- Cover everyday expenses or build an emergency cushion
- Make home improvements
- Fund the retirement lifestyle you want
See how a reverse mortgage works and whether you qualify.
5. Where he’s wrong #2: for the lower earner in a couple
Ramsey’s rule is one-size-fits-all, and Social Security isn’t. For married couples, it often makes sense for the lower earner to claim early while the higher earner delays — growing the benefit that eventually becomes the survivor’s check.
In that case, claiming at 62 isn’t a blunder. It’s a coordinated strategy. The pros and cons genuinely cut differently for each spouse, and I’ve laid them out here.
6. Where he’s wrong #3: when you’ve actually won the game
Here’s the case Ramsey’s blanket warning misses entirely. If you’re debt-free with enough saved — his own “truly ready” test (1) — retiring at 62 to enjoy your healthiest years isn’t reckless. It’s the entire point of saving in the first place.
Time is the one asset you can’t earn back. We’ve talked to people who walked away at 62 with their eyes open and never looked back. The real risk isn’t only running out of money. It’s running out of good years while you wait for a “perfect” number that never quite arrives.
The bottom line
Ramsey’s parachute line is right far more often than it’s wrong. Most people do retire too early, claim too early, and underestimate how long — and how expensive — life gets. Run your actual number before you leap.
But don’t let “work longer” curdle into “work forever.” If you’re debt-free, covered, and the math holds, 62 can be a gift instead of a gamble.
Spend a whole life chasing a bigger number and you can miss the reason you saved it. Retire on the math — then go spend the time you bought.
Sources: Kiplinger (1); Social Security Administration (2); Fidelity (3); Fidelity Institutional (4).
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