Deciding when to claim Social Security benefits is one of the most significant financial decisions retirees face. While waiting until full retirement age or even 70 can result in higher monthly payments, financial expert Dave Ramsey believes there are specific cases where taking Social Security at 62 is the right choice. However, it’s not a decision to take lightly.
Ramsey emphasizes that early Social Security benefits only work if you follow certain rules to maximize the impact of your decision. Let’s explore the three key rules Ramsey recommends for anyone considering claiming Social Security at 62.
1. Use the Money to Cover Essential Expenses
The first rule is to ensure your Social Security checks go toward essential living expenses. Ramsey highlights the importance of using this income wisely, particularly for retirees who depend on Social Security as a primary source of income.
If you’re still working part-time or have other sources of income, Social Security should supplement your necessities like housing, utilities, and healthcare. Spending it on discretionary expenses like travel or entertainment can jeopardize your long-term financial stability.
Ramsey advises budgeting carefully to ensure that your benefits align with your overall financial plan. A solid budget can help you track expenses, minimize waste, and stretch your Social Security dollars further.
Pro Tip: If you’ve got at least $100,000 in investments, use SmartAsset to connect with a vetted financial advisor who can help you create a plan to make the most of your Social Security benefits.
2. Avoid Claiming Benefits If You’re Still Earning a High Income
