Yahoo Finance How Big Would Dave Ramsey’s Social Security Check Be If He Collects Early vs. Full Retirement Age?
Personal finance expert Dave Ramsey is 62 years old, an age when many start collecting Social Security early. But how much smaller would his Social Security check be if he collected now versus full retirement age?
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According to Zippia, Dave Ramsey has an annual revenue of $20 million, but this doesn’t mean his Social Security benefit will be based on this amount. Social Security benefits are typically calculated using “average indexed monthly earnings,” which summarizes up to 35 years of a worker’s indexed earnings.
Dave Ramsey Solutions states Ramsey became rich at 26 years old, filed for bankruptcy two years later and then turned his life around to create the brand everyone knows today. Currently, Ramsey has a net worth of $200 million, as previously reported by GOBankingRates.
There’s also a limit on annual earnings subject to Social Security taxes, known as the taxable maximum or the Social Security tax cap, that changes each year based on an index of national average wages. This means that if you earn over the taxable maximum, you don’t pay Social Security taxes past that amount.
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The Social Security Administration has set the taxable maximum for 2023 to $160,200 and will increase the maximum to $168,600 in 2024. According to the Peter G. Peterson Foundation, only about 6% of the working population earns more than the taxable maximum.
A Rough Calculation of Ramsey’s Potential Benefits
Assuming Ramsey has earned over the taxable maximum for 35 years and took his Social Security benefit at age 62, he would get a monthly check for $2,572. However, if he waits until turning 67 on September 3, 2027, which is full retirement age for anyone born between 1955 and 1960, his monthly benefit check would increase to $4,118 (in inflation-adjusted dollars, per the SSA calculator). If he waits until age 70 in 2030, he will get a sizeable $5,592 monthly check, accounting for inflation, per the SSA calculator’s estimate. It should be noted that even the SSA itself indicates “benefit estimates made by the Quick Calculator are rough.”
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This article originally appeared on GOBankingRates.com: How Big Would Dave Ramsey’s Social Security Check Be If He Collects Early vs. Full Retirement Age?
