According to the global study from HSBC, The Future of Retirement, many working-age people in the U.S. and worldwide are hoping to live off an inheritance after leaving the workforce. The question is, how long can you live on the amount you may receive?
HSBC found that nearly three in four (72%) of those expecting an inheritance say they plan to use it to finance their retirement to some extent, and 10% think it will fund their retirement entirely.
In the United States, more than three in four (76%) believe it will finance either all (10%) or part (66%) of their retirement, but the probability of getting an inheritance varies by country.
People in developing countries have a greater chance of receiving an inheritance than people in the United States and most other developed countries, according to the study. Most retirees in India (86%), Mexico (84%), Malaysia (78%) and Brazil (71%) expect to leave their family members an inheritance, whereas in the United States just over half (56%) plan to do so.
The inheritance amounts, however, are more modest in developing countries, ranging from an average of $39,000 in Malaysia to $132,000 in Brazil. In the United States, expected inheritances average $177,000, while in Australia, 69% of retirees plan to leave their heirs $502,000.
Worldwide, almost seven in 10 retirees (69%) expect to leave an average of $148,000 to their family members, according to the findings.
While many Americans expect to leave an inheritance, there are many variables that may prevent this from happening. Older people often face unexpected hurdles and may require the money themselves to fund other things such as medical and nursing care in later life, and with increased life expectancy, they may outlive their income.
So, back to the question: How long can you live on the amount you may receive? What if you receive very little or nothing and have limited or no savings of your own?
Now is the time to take personal financial responsibility for your retirement planning to insure you have sufficient income for a retirement that may last more than 25 years. Call your agent or advisor today to start your planning.