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When it comes to retirement planning, most people talk about the traditional stool with three legs—employer pensions, Social Security, and individual savings. And yes, all three legs look pretty wobbly right now. But there's an additional leg that no one talks about but many seem to be counting on: an inheritance.

Some 51% expect to inherit money from older family members, according to a recent HSBC survey of 16,000 working-age people. Two thirds of this group believe that windfall will help fund their retirement, and more than 25% expect this money to fund it largely or completely. Perhaps for a few, this is a realistic expectation. But for most of us, the data are starting to suggest that we’d better not count our chickens before they hatch.

Back in the 1980s, economists were predicting a huge inter-generational wealth transfer from the so-called G.I. and Silent Generations (born 1901 to 1945) to the Baby Boomers (born 1946 to 1964). However, a Bureau of Labor Statistics report published a few years ago found that there was little evidence of an “inheritance boom,” and that inheritances as a share of household net worth actually fell from 1989 to 2007.

What has been increasing, both in frequency and in dollar amounts, are so-called “intra-family cash transfers," all those times older family members help out their children and grandchildren financially during their lifetimes. According to a new study from the Employee Benefit Research Organization, 44% of older households (age 50 or above) gave money to their children or grandchildren during the two years ending in 2010, up from 38% in 1998.

And we’re not talking about just birthday money or graduation checks. Of those older households who gave to their families, the average amount is more than $10,000—enough to be considered a major expenditure in their household budget.

Estate planners often say that it’s smarter for older people to give away their money gradually while they are alive, since those cash transfers can minimize inheritance taxes for their heirs. But here's the problem: even though those gifts reduce estate taxes, they probably don’t improve the retirement readiness of the younger generation. That's because the money typically gets spent on immediate needs, such as mortgages, medical care, and college tuitions, or perhaps a few splurges.

In short, if your parents or grandparents have given you major financial gifts, chances are you’ve already spent some of your inheritance. And if those gifts continue, your inheritance may be greatly diminished or even completely gone by the time the will is read. So much for the bailout of your retirement plan.

To be on the safe side, it’s probably wise for anyone still in the “accumulation” phase of saving for retirement to not plan on any kind of inheritance at all. And if you have already received living cash transfers from your older relatives, make sure to keep up your own contributions to your retirement savings, so that you may have enough set aside to do the same for your own children and grandchildren.

Konigsberg is the author of The Truth About Grief, a contributor to the anthology Money Changes Everything, and a director at Arden Asset Management. The views expressed are solely her own.

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