What Is Needed to Retire at 62: Savings, Spending and Odds

$1.1 million or $2.8 million. A 62-year-old who starts with $2.4 million and spends $96,000 in the first year could have either amount at 80. The only thing that changes is the order in which the market's good and bad years arrive. The average return is identical (24/7 Wall St, May 2026). That range is the honest short answer to whether you can retire at 62. No single dollar figure makes it safe. What you need is enough savings, income and health coverage that your plan survives most of the futures you could get, and not only the average one.

Here's what that looks like in plain numbers.

What is needed to retire at 62: the short version

You need five things to line up:

1. Enough savings to cover the gap between what you spend and what you get from Social Security, pensions or part-time work, taken out at a rate the portfolio can sustain.
2. A Social Security decision. Claiming at 62 locks in a permanently smaller check.
3. Health coverage for three years. Medicare starts at 65. From 62 to 65 you pay for coverage yourself.
4. A plan that runs into your 90s. Retiring at 62 can mean 30 or more years of withdrawals.
5. A plan that holds up in bad markets, because a weak first few years can damage it more than a weak average return.

Each one is covered below.

Why the savings rules of thumb don't agree

Look up how much you need and you'll get several different answers. The guides that rank for this question, including Boldin, SmartAsset, Western & Southern and Nasdaq, suggest targets such as 28–30 times your annual spending, a range of $750,000 to $1.5 million on top of Social Security, or 14 times your salary.

They aren't really contradicting each other. They're answering slightly different questions.

A multiple of spending is more useful than a multiple of salary. Your salary doesn't pay for retirement. Your portfolio pays for whatever your other income doesn't cover.

The research also points to slightly more conservative numbers. Morningstar's 2025 research puts the safe starting withdrawal rate at 3.9%. That figure is judged by whether the money is still there in 90% of simulated outcomes over a 30-year retirement, not by an average return (Source: Morningstar, The State of Retirement Income 2025, Dec 2025). A 3.9% withdrawal rate works out to roughly 25.6 times the amount you need from the portfolio each year.

There's a catch for anyone retiring at 62. Thirty years only takes you to 92. A plan that runs to 95 needs to last 33 years, so 3.9% is a starting point, not a guarantee.

Social Security at 62: the 30% question

If you were born in 1960 or later, your full retirement age is 67. Claiming at 62 cuts your benefit by about 30%, permanently. The formula reduces your benefit by 5/9 of 1% for each of the first 36 months you claim early, and by 5/12 of 1% for each month beyond that. Wait past 67 and you earn an extra 8% a year until 70 (SSA retirement benefit chart, archived; Fox Business).

So claiming at 62 pays about 70% of your full benefit, and claiming at 70 pays about 124%. That makes the age-70 check roughly three-quarters larger than the age-62 check, every month, for life.

Retiring at 62 doesn't mean you have to claim at 62. Some people stop working at 62 and live on their portfolio for a few "bridge years" so they can claim later and lock in a larger check that rises with inflation. It costs you more savings at the start. In return you rely less on the portfolio in your 80s and 90s, which is when running out hurts most.

If you're married, the decision matters even more. The larger of your two benefits generally becomes the survivor's benefit, so when the higher earner claims affects both of you.

The three-year health insurance gap

Before Medicare you have two main options:

• COBRA keeps your employer's plan, usually for 18 months. You pay the full premium plus 2%. One 2026 estimate puts that at $600–$1,200 a month for an individual (ForHealthInsurance).
• ACA marketplace plans, where premium tax credits depend on your income.

Most "retire at 62" guides don't mention this next point. In 2026, your withdrawals can decide your health insurance bill. ACA tax credits stop at 400% of the federal poverty line. For a single person that's $62,600, based on the 2025 poverty guideline of $15,650 (OwnYourCoverage, 2026 early retiree guide). If a large IRA withdrawal or a Roth conversion pushes your income over that line, you can lose the subsidy for the whole year.

So the order you draw from accounts in during these years matters: taxable accounts, cash, tax-deferred accounts, Roth. It's worth planning carefully. A tax professional can help with the details.

Health costs continue after 65, too. Fidelity estimates that a 65-year-old retiring in 2025 will spend $172,500 on Medicare premiums, deductibles and prescriptions over retirement. That doesn't include long-term care (Source: Fidelity Investments, 2025 Retiree Health Care Cost Estimate, Jul 2025). If you retire at 62, the three years before Medicare come on top of that.

A worked example (hypothetical, rough math)

Most articles stop at a checklist. Here's a simple illustration. The numbers are invented for the example and are not a recommendation.

Say you're 62, you spend $5,000 a month ($60,000 a year), and your Social Security benefit at 67 would be $2,000 a month.

What this shows:

• Waiting to claim needs more money at 62 in this simple version. After 67 the plan relies less on the portfolio, and that matters more the longer you live.
• The table leaves out inflation during the bridge years, taxes, health premiums before 65, and the extra three years past a 30-year horizon. All of them push the total up.
• Spending has the most effect. Cut $500 a month and the claim-at-62 savings figure drops by about $150,000.

Arithmetic like this gives you a starting point. It can't tell you how likely the plan is to work.

Why one number isn't enough: sequence risk

Go back to the opening example. Both versions of that retiree earned the same average return. One ended up with more than twice as much money as the other.

This is called sequence-of-returns risk. If markets fall early in retirement, you're selling investments at low prices to pay the bills, and those shares aren't there when markets recover. The earlier you retire, the longer you're exposed to it.

That's why a projection built on an average return can be dangerously reassuring. A Monte Carlo simulation tests the plan differently. Instead of one average path, it runs your plan through many possible market histories, good orders and bad, and counts how many of them keep you funded. The result is a probability: in 870 of 1,000 futures, the money lasted.

That's the kind of answer Morningstar's 3.9% figure is based on, and it's the right question when you're deciding whether to retire at 62.

Plan to 95, not 85

According to Social Security's own planning guidance, about one in three 65-year-olds may live to at least 90 (Source: Social Security Administration, Retirement Information for Medicare Beneficiaries, 2026). A plan that ends at 85 is quietly betting you won't be one of them.

If you retire at 62, a plan that runs to 95 covers 33 years. That's a long time for inflation, health costs and markets to affect your savings.

What to do next

Most people never run the numbers. EBRI's 2025 Retirement Confidence Survey found that only 52% of workers have estimated the monthly income they'll need in retirement, which leaves 48% guessing (Source: EBRI/Greenwald, Retirement Confidence Survey 2025, Fact Sheet 3).

Before you decide, check four things:

• Your real monthly spending, including taxes and health premiums.
• Your Social Security estimate at 62, 67 and 70.
• Your health coverage plan for 62 to 65, and the income limit that affects it.
• Your probability of success, not your average outcome.

You can get that last one quickly. Enter your age, your retirement savings and your monthly spending into the Monte Climb retirement calculator. It runs those three numbers through 1,000 simulated futures and shows how many stay funded. It runs in your browser, and nothing is saved until you choose to save it. If you want to dig into the result, you can ask William, our AI planner, "Can I retire at 62?" and he'll show you how he got his answer.

It's planning software, not advice, and the answer is a probability, not a promise. It's still a better place to start than a guess.

Show my answer →

Frequently asked questions

How much money do I need to retire at 62?

No single figure works for everyone. A useful starting point: subtract your Social Security and other income from your annual spending, then divide what's left by a sustainable withdrawal rate. Morningstar's 2025 research puts that rate at 3.9% for a 30-year retirement, which is about 25.6 times the yearly amount your portfolio has to cover. Retiring at 62 can mean a retirement longer than 30 years, so many people aim for more margin than that.

How much is Social Security reduced if I claim at 62?

If you were born in 1960 or later, your full retirement age is 67, and claiming at 62 cuts your benefit by about 30% for life. If you wait past 67, your benefit grows by 8% a year until age 70.

How do I get health insurance if I retire at 62?

Medicare starts at 65, so you have to cover three years yourself. The usual options are COBRA, which typically lasts 18 months at the full premium plus 2%, or an ACA marketplace plan. ACA subsidies depend on your income, and in 2026 they stop at $62,600 for a single person, so your withdrawals can change what you pay.

Can I retire at 62 but delay Social Security?

Yes. Some people use their savings to cover the 'bridge years' from 62 to 67 or 70, then claim a larger Social Security check that rises with inflation. You need more savings at the start, but your portfolio has to do less later in life.

Is the 4% rule safe if I retire at 62?

The 4% rule was built around a 30-year retirement. If you retire at 62 and plan to 95, that's 33 years. Morningstar's 2025 research puts the safe starting rate at 3.9%. A Monte Carlo simulation that tests your own numbers across many possible market sequences gives you a more realistic picture.