An Atlanta man had $1.7 million in the bank — but was still afraid to spend. Dave Ramsey on the retirement trap even millionaires fall into

Yet instead of feeling relieved as retirement approached, he felt anxious.

"My question is a little more psychological than financial," Kevin told host Dave Ramsey during the call back in 2014. "It's just there's something in my head about seeing those savings going the other direction."

Kevin, who planned to retire around age 66, said he and his wife expected to bring in about $96,000 a year in income. Their home still carried a mortgage, but their financial outlook appeared relatively stable.

In fact, he said they might not need to draw down their investment principal significantly unless a major expense, such as a medical issue, arose.

Still, the idea of spending their savings — even small amounts — made him uncomfortable.

The retirement trap many millionaires face

Ramsey described Kevin as a classic example of a self-made American millionaire.

"You don't feel like a millionaire, do you?" Ramsey asked during the call. Kevin quickly answered no.

The Center for Retirement Research at Boston College (2) reported that half of all retirees are reluctant to spend or draw down their savings, heightening the difficulty of mentally switching from saving to spending after decades of disciplined accumulation.

For most workers, retirement planning focuses almost entirely on the saving phase: contributing to retirement accounts, investing consistently and avoiding lifestyle inflation.

Once retirement begins, the financial equation flips. Instead of adding money to accounts, retirees must begin withdrawing from them, a process financial planners call decumulation (3).

For lifelong savers, that shift can feel deeply unsettling.

Retirees often spend less than economic theory predicts (4). Even when retirement models suggest their portfolios are sustainable, retirees may worry about market crashes, healthcare costs, or simply "running out of money."

Longevity also plays a role. According to Fidelity (5), for a healthy couple at age 65, there is a high probability that at least one partner will live into their early 90s. That long time horizon can make retirees hesitant to spend too quickly.

Learning how to spend after a lifetime of saving

Ramsey's advice to Kevin focused on a simple concept: practice. "You've spent 66 years building up one muscle — your saving muscle," Ramsey told him. "

Instead of making drastic financial changes, Ramsey suggested starting small. He asked Kevin how much he usually spends on a cruise vacation. Kevin estimated about $4,000. Ramsey's assignment was simple: double it.

" I want you to plan to spend $8,000 on a cruise this year," Ramsey said. "You've got $1.7 million, dude. I didn't even take the sweat off your interest."

With a portfolio of that size, Ramsey argued that occasional larger discretionary purchases are unlikely to significantly affect long-term financial stability, assuming typical market returns and sustainable withdrawal rates.

He offered another example: Kevin had mentioned wanting a high-end woodworking tool that cost a little over $3,000. "Perfect," Ramsey replied. "You didn't tell me $300,000."

After years of disciplined saving, retirees may need to become more comfortable spending in a planned and intentional way, provided their overall financial plan supports it.

Why structure matters in retirement spending

Financial planners often recommend creating a structured withdrawal strategy to ease that psychological transition.