Americans expecting to inherit money from their parents or other relatives are overwhelmingly counting on those funds for their retirement, new polling shows.
Among prospective heirs surveyed by LendingTree, 43 percent said they are counting on an inheritance or financial gift “a great deal” to help fund their retirement, while 38 percent said they are counting on it “somewhat.” Together, that means 81 percent are relying on an expected inheritance to at least some degree.
The findings come as older American homeowners are projected to pass down an enormous pool of wealth in the coming decades. LendingTree estimates that around $17.2 trillion could be transferred between 2026 and 2045, averaging about $859 billion a year.
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But banking on inheritance comes with risks, experts said, as the amount and timing of any eventual windfall can be affected by longer lifespans, health and long-term care costs, market losses, taxes and changing family circumstances.
Billions to Be Handed Down
The poll, conducted in July among 525 U.S. consumers younger than 65 who expect to receive an inheritance or financial gift, found that Americans who expect to inherit money are overwhelmingly factoring it into their later life plans.
More often than not, Americans are expecting to receive some financial benefit when their parents die. LendingTree found that 33 percent of Americans younger than 65 expect to receive an inheritance or financial gift in the future. That rises to 53 percent among people earning at least $100,000, 46 percent among parents with children under 18 and 43 percent among Gen Z adults.
But there’s a gap between what younger Americans expect and what older generations intend to leave behind. Just 43 percent of Americans aged 65 and older said they plan to give an inheritance or financial gift, according to the study.
Many prospective heirs also appear to be making plans without having firm details about the money they expect to receive. Only 57 percent said they had clearly discussed the amount, timing or likelihood of an inheritance with the person they expect it from. Another 28 percent said the subject had been discussed only broadly, while 16 percent had not discussed it at all.
The expectations come against the backdrop of a potentially enormous transfer of wealth. LendingTree estimates that homeowners aged 65 and older could pass down approximately $17.2 trillion in the next almost 20 years. The projection is based on a model of older homeowners’ property values, broader household wealth and mortality rates, rather than money already guaranteed to individual heirs.
The findings also come as Americans continue to struggle with the cost of living and preparing for retirement. The Federal Reserve’s latest Survey of Household Economics and Decision Making found that just 35 percent of non-retirees believed their retirement savings was on track in 2025, while 53 percent of adults considered price increases a major financial concern. Fifty-eight percent said price changes over the previous year had made their financial situation worse.
‘Risky’ to Count on Inheritance
Phillip E. Battin, president and CEO of Ambassador Wealth Management, told Newsweek that factoring an expected inheritance into retirement planning was “extremely risky.”
“You’re presuming tomorrow—and tomorrow has a lot of variables,” Battin said. “A lawsuit, accident, major medical or long-term care expense, market downturn or family change could dramatically reduce an inheritance.”
David Talley, a certified financial planner and founder of Talley Wealth, said he had seen those risks play out, including one case in which a parent removed a child from their estate shortly before dying.
“That child was expecting a million dollars,” he told Newsweek. “Stuff like that really does happen, and you think it’ll never happen to you.”
Talley also pointed to the potentially enormous impact of long-term care, describing another family in which someone spent nine years in specialized care.
“That’s a million dollars of care right there, and the amount that comes down the line is far, far less than anyone expected,” he said.
Battin warned that saving less because of an expected inheritance could leave people with substantially less money in retirement, even if the inheritance eventually arrives, as “every dollar they don’t save today loses years of potential compounding,” he said. “Less savings means less flexibility and more uncertainty.”
The amount ultimately inherited can also be reduced by longevity, health costs, investment losses, inflation, taxes, divorce, remarriage and changing family circumstances.
“The amount, timing and tax treatment of an inheritance are all uncertain until the money is actually yours,” Battin said. “Don’t cash a check until the ink dries.”
Contact Newsweek editors on this story: Daniel Orton and Dave Siminoff.