If You're Not Following Dave Ramsey's Social Security Advice, You're Making a Big Mistake

"You're allowed to claim benefits as early as age 62. However, if you want to collect your complete monthly benefit each month without a reduction, then you'll need to wait until full retirement age (FRA) to file. There's also the option to delay your Social Security claim past FRA for boosted monthly checks. For each year you hold off, your monthly benefits get an 8% increase."

"Dave Ramsey hates to see people in debt because he feels it's bad for their finances. It therefore stands to reason that Ramsey would not give anyone bad financial advice intentionally. With that in mind, Ramsey is a huge proponent of claiming Social Security at 62, despite the fact that doing so causes a permanent reduction in benefits. The reason Ramsey feels this way is that, to put it bluntly, when you run out, Social Security runs out."

"There are some tough financial decisions you might have to make in the context of retirement. These include when to start tapping your savings, how to invest your savings, and what withdrawal rate to use to ensure that your money doesn't run out. You'll also need to choose the right healthcare coverage in retirement, as the wrong Medicare plan could lead to higher costs. Finally, you'll need to decide where to settle down, how much to spend on large expenses like housing,"

Retirement requires choices about when to start withdrawals, how to invest savings, and what withdrawal rate will prevent exhaustion. Healthcare coverage selection in retirement affects costs, and choosing the wrong Medicare plan can increase expenses. Decisions about where to live, housing budgets, and discretionary splurges influence retirement sustainability. Social Security timing is a pivotal decision; benefits can begin at 62, full benefits depend on full retirement age, and delaying beyond FRA raises monthly benefits by 8% per year. Some advisers caution against claiming at 62 because of permanent reductions, while others favor early claiming due to lifetime income certainty and lifespan uncertainty.

Read at 24/7 Wall St.