Are you counting on an inheritance to help you make ends meet or secure your financial future? If you answered yes, you're very much not alone. That's the finding from a new Merrill Edge survey of 1,000 Americans, ranging in age from 18 up into their 70s. One-third of them reported that they would need an inheritance to achieve financial stability. (Merrill Edge is a discount brokerage subsidiary of Bank of America, which also owns Merrill Lynch.)

That includes a surprising 20 percent of Baby Boomers, who you might think had already established financial stability by this time in their lives, and might not necessarily have great prospects for inheritance. It also includes a depressingly large proportion of Generation Z respondents, defined here as 18- to 22-year-olds. With their whole lives and careers ahead of them, you might think these young people would be optimistic about their ability to earn their way to financial independence. But no: 63 percent say they'll need an inheritance to be financially stable.

These results are particularly striking because Merrill Edge didn't do a survey of the general population. This survey's respondents are what the company calls "mass affluent," defined as people with portfolios of $50,000 to $250,000, or those under 40 with portfolios of at least $20,000 and annual incomes of more than $50,000. 

In other words, these are people with money of their own, or solid incomes, or both. They should feel like they're on their way to financial security, and yet they don't. The only way they can get there is if somebody dies.

If you've been counting on an inheritance to give you financial stability, there are about a thousand reasons why you should stop. Here are just a few of them:

1. It's a recipe for unhappiness.

Science says so. Research shows that people with money are happier if they earned it rather than inherited it. So planning to inherit money rather than earn it yourself is planning for a life where you'll be less happy than you could be. Why would anyone do that?

2. It probably means you have too much debt.

Young people today face some very difficult choices when it comes to college. There's plenty of evidence that having a college degree means you'll likely earn more than someone who doesn't have one. On the other hand, it's difficult to get a degree these days without taking on crippling student loans. And then there's credit card debt, which has crept up on many of us. 

If you have what feels like unpayable debt, you may think that an inheritance is the only way out. That's almost never true, though. Doing what you need to to pay down your debt won't be fun, but it's almost always doable. And it's a lot better than waiting for someone to die.

3. What happens if you're wrong?

Even if you know for an absolute fact that you're someone's heir, any number of things could happen to mess up your inheritance plans. Your planned source of wealth could live to an extremely old age. They could marry someone younger and change plans. That person could need lots of care during his or her declining years, which might mean that most of the money is spent before you can inherit it. Or he or she could make a bad investment and lose most of the money. 

It's a bad plan to count on someone else's death so you can achieve financial stability. And it's unnecessary. Whoever you are and whatever your situation, you have options for taking control of your financial future and taking action to create your financial stability without depending on anyone else. That's a much better idea than waiting for a legacy that may not ever arrive.

Published on: Jun 18, 2018
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