Retire at 62 with $4 Million: How Much Can You Safely Spend?

3.9%. Morningstar's 2025 research says that's the starting withdrawal rate that still leaves money in the account in 90% of simulated futures over a 30-year retirement. On $4 million, that comes to about $156,000 in year one. So if you want to retire at 62 with $4 million, the short answer is yes, many people can. The longer answer is that how much you can spend matters more than whether you can stop working. That number moves with your age, your health coverage before Medicare, when you claim Social Security, and how markets behave in your first few years.

This guide covers each of those. We'll keep the numbers honest along the way: what you get is a probability, not a promise.

Source: Morningstar, The State of Retirement Income 2025, Dec 2025.

The short answer: roughly $140,000 to $160,000 a year, before tax

Most of the advice on this question starts from a withdrawal rate. That's the share of your portfolio you take out in year one, and you raise it with inflation after that. On $4 million, the usual rates work out like this:

Kiplinger's adviser Q&A with a 62-year-old holding $4 million gives a similar range of about $140,000 to $160,000 a year before tax.

That's a good place to start. It isn't your answer yet. Three things push your real number up or down.

Why 62 is harder than 65

Morningstar's 3.9% was tested on a 30-year retirement. If you stop at 62 and plan to age 95, you need the money to last 33 years. A longer horizon usually means a lower safe starting rate, because the money has more years to get through bad markets.

Is 95 too cautious? Social Security's planning guidance says about one in three 65-year-olds may live to at least 90. A plan that ends at 85 is quietly betting against a third of retirees. If you're married, the odds that at least one of you lives a long time are higher again.

Source: Social Security Administration, Retirement Information for Medicare Beneficiaries, 2026.

That's why the plan you build at Monte Climb runs to 95 by default. You can push it further.

Retire at 62 with $4 million: why odds beat averages

Most calculators assume a steady average return, say 6% a year, and draw a smooth line. Real markets don't do that. Two retirees can earn the same average return over 30 years and end up in very different places. It depends on when the bad years come.

That's called sequence risk. A big market drop in your first five years hurts far more than the same drop at 80. Early on, you're selling investments while prices are low to pay your bills. Those shares are gone and can't recover when the market does. At 62 you're exposed to this for longer than most retirees.

A Monte Carlo simulation is built to show this. It's a plain idea: rather than one average path, you run your plan through many possible market histories (some calm, some brutal, some lucky) and count how many of them leave you with money. If 900 of 1,000 futures stay funded, your success rate is 90%. That's the same yardstick behind Morningstar's 3.9% figure.

Why does this matter at $4 million?

• $156,000 a year and $200,000 a year can both look fine on an average-return chart. Their success rates can be very different.
• Flexible spending helps a lot. If you're willing to cut back after a bad year (often called "guardrails"), your odds can go up noticeably. A fixed-average projection can't show you that trade-off.
• You can see what failure looks like. Does the money run out at 88 or at 94? That changes how you'd plan.

The three years before Medicare

Medicare starts at 65. Retire at 62 and you need to cover three years of health insurance yourself. For many early retirees, that means an Affordable Care Act (ACA) marketplace plan.

Here's the problem the top-ranking articles mostly skip. Unless Congress extends the enhanced premium tax credits, there's no ACA subsidy above 400% of the federal poverty level. KFF puts that line at about $62,600 for a single person, and it notes that older enrollees face the steepest premium increases. Earn one dollar over the line and you can lose the whole subsidy. That's why people call it a cliff.

Two details matter if you have $4 million:

1. The ACA counts more than your salary. Roth conversions and realized capital gains count in full toward ACA income, even gains taxed at 0% federally. (Q3 Advisors' ACA income guide explains how.)
2. You may be able to control where you land. If you live on cash and the cost basis of taxable investments, your reported income in those years can be much lower than your spending. Retirement Researcher's guide to the subsidy cliff walks through these strategies.

The rules for 2026 have been in flux. Check the current status on your state or federal marketplace during open enrollment before you build a plan on either version.

Social Security: take it at 62, or let your savings bridge the gap?

You can claim at 62. Whether you should is a portfolio question as much as a Social Security one.

If your full retirement age is 67 (anyone born in 1960 or later), claiming at 62 pays 70% of your full benefit. That's a permanent 30% cut. Each year you wait past 67 adds 8%, up to age 70. (24/7 Wall St. breaks down the 30% reduction. You can confirm your own figures on ssa.gov.)

With $4 million, you have a real choice:

• Claim early: you draw less from savings now, but you lock in a smaller check for life.
• Delay: you draw more from savings for a few years. That's the "bridge." In return you get a larger, inflation-adjusted check for the rest of your life. Think of it as buying longevity insurance with your portfolio.

The bridge costs real money. Yahoo Finance's look at retiring at 62 with $2 million shows how big the draw before Social Security can get. At $4 million you have more room, but heavier early withdrawals also leave you more exposed to sequence risk. This trade-off needs to be modeled, not guessed.

Taxes: $156,000 withdrawn isn't $156,000 to spend

Where your $4 million sits matters a great deal:

• Pre-tax (traditional 401(k)/IRA): every dollar you withdraw is taxed as ordinary income.
• Roth: qualified withdrawals are generally tax-free.
• Taxable brokerage: you're only taxed on the gains, often at lower capital-gains rates.

Wealthtender estimates roughly $78,000 to $109,000 a year of after-tax income from a $4 million portfolio before Social Security starts. Check the assumptions behind that figure, but it shows how big the gap between gross and net can be.

The years between retiring and required minimum distributions are often low-income. That makes them a window for Roth conversions. But conversions count as ACA income, so the conversion strategy and the subsidy strategy pull against each other from 62 to 65. That's another reason to look at your plan year by year rather than as one average.

Health care after 65 is still a line item

Medicare doesn't make health costs go away. Fidelity estimates a 65-year-old retiring in 2025 will need about $172,500 for Medicare premiums, deductibles and prescriptions over retirement. That figure leaves out long-term care entirely.

Source: Fidelity Investments, 2025 Retiree Health Care Cost Estimate, Jul 2025.

On a $4 million plan, higher income can also bring income-based Medicare surcharges. Monte Climb's engine charges Medicare premiums and those income-based surcharges year by year rather than as a flat guess. Here's why: a large Roth conversion at 64 could raise your Medicare premiums a couple of years later.

Should you quit now or work one more year?

The Kiplinger reader at 62 with $4 million had a buyout offer and a job she loved. That's a common position. The money may be enough. The real question is how much one, two or three more years would change things.

Each extra year of work usually helps in three ways:

1. Your savings get another year to grow instead of shrinking.
2. You need one fewer year of withdrawals, and the plan has to last one fewer year.
3. You're one year closer to Medicare and Social Security, so the bridge gets shorter and cheaper.

Is that worth a year of your life? Only you can say. But you can put a number on it: compare your success rate retiring at 62 against 63 or 64, and decide with the numbers in front of you.

Run your own numbers

Half the people asking this question haven't done the first step. EBRI's 2025 Retirement Confidence Survey found only 52% of workers have estimated the monthly income they'll need in retirement. The rest are guessing.

Source: EBRI/Greenwald Retirement Confidence Survey 2025, Fact Sheet 3.

You don't have to guess. Three numbers: your age, what you've saved, what you spend each month. Monte Climb runs them through 1,000 simulated futures and shows how many stay funded. It runs in your browser, and nothing is saved until you say so. After that, you can ask William, our AI planner, follow-up questions like "Retire at 62?" or "What's a sustainable spend?" He shows his work.

It's planning software, not advice. But it's a far better starting point than one average-return line.

Show my answer →

Frequently asked questions

How much can I spend per year if I retire at 62 with $4 million?

Common withdrawal rules point to about $140,000 to $160,000 a year before tax (3.5% to 4%). Morningstar's 2025 safe starting rate of 3.9% works out to about $156,000. That rate was tested over 30 years, though. Retiring at 62 and planning to 95 means 33 years, which usually calls for a somewhat more cautious rate.

Is $4 million enough to retire at 62?

For many people, yes. It depends on your spending, taxes, health coverage before Medicare at 65, and when you claim Social Security. A Monte Carlo test runs your plan through many possible market histories and shows the share that stay funded, which tells you more than a simple yes or no.

Should I claim Social Security at 62 if I have $4 million?

Not necessarily. If your full retirement age is 67, claiming at 62 permanently cuts your benefit to 70% of the full amount. Each year you wait past 67 adds 8%, up to age 70. With $4 million, some people draw more from savings early to get a larger inflation-adjusted check later. It's a trade-off worth modeling.

How do I pay for health insurance between 62 and 65?

Many early retirees use an ACA marketplace plan. Unless the enhanced tax credits are extended, there's no subsidy above 400% of the federal poverty level, which KFF puts at about $62,600 for a single person. Roth conversions and capital gains count toward that income. Check the current rules during open enrollment.

What is sequence risk and why does it matter at 62?

Sequence risk is the danger that markets fall early in retirement, while you're selling investments to pay your bills. Retiring at 62 means a longer stretch of withdrawals, so a bad first few years can hurt your odds more than the same drop would later on.