Here's Why Dave Ramsey Thinks Claiming Social Security at 70 Is a Bad Move

"There's a reason older Americans are often advised to wait until age 70 to claim Social Security. While it's possible to start getting benefits as early as age 62, waiting until age 70 guarantees larger monthly checks for life. Given that many Americans sorely lack retirement savings, it's pretty common for people to end up with only Social Security for income later in life. So the larger those benefits are, the less financial struggle might ensue."

"And part of the reason boils down to longevity and risk. As Ramsey has said himself, Social Security dies with you. Filing for benefits at age 70 only works out financially if you live long enough to make up for many years without collecting those monthly benefits. Since there's no guarantee of that happening, Ramsey doesn't think claiming Social Security at 70 is wise."

"Ramsey is pretty convinced that claiming Social Security at 62 and investing the money could yield more wealth than waiting to file for benefits and securing larger monthly checks. Also, for many people, the ability to wait until 70 to claim Social Security hinges on having other income. But it can be argued that tapping retirement savings during your 60s to wait on Social Security could result in less total income compared to leaving those retirement accounts to continue growing."

Waiting until age 70 increases monthly Social Security benefits, producing larger lifetime checks for those who live long enough. Claiming at 62 starts payments earlier, reducing the risk that benefits cease due to premature death and allowing earlier investment of benefits, which can outperform delayed claiming. The decision involves opportunity cost, dependence on other income to sustain delays, and tradeoffs between withdrawing retirement savings versus allowing accounts to grow. Longevity uncertainty and personal financial circumstances determine whether earlier claiming or delayed claiming yields higher lifetime income. The choice depends on individual risk tolerance, available savings, and expected lifespan.

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