Millennials Banking on Inheritance at 65: Why You Can’t Count on Mom and Dad’s Money for Retirement

On a recent episode of the Animal Spirits podcast, Ritholtz Wealth Management’s Ben Carlson laid out a number that should reset how millennials think about their parents’ money. “A 65-year-old couple, there’s a 64% chance, so two-thirds chance or so, that at least one partner will live beyond 90,” he said, citing New York Times data. That single figure rearranges the math behind a quiet retirement plan a lot of 35-year-olds are running in their heads: Mom and Dad will leave me something, and that will fill the gap.

The stakes are concrete. If you are 35 today and your parents are 65, the most likely scenario is that one of them lives into their 90s. That pushes the inheritance into your own retirement window, not your wealth-building years. Carlson and co-host Michael Batnick referenced Wall Street Journal analysis showing most millennial inheritances won’t arrive “until like the bulk of it until I don’t know, the 2030s and possibly into the 2040s.” By then, the oldest millennials are already drawing Social Security.

The verdict: inheritance is a bonus, never a plan

Banking on inheritance for retirement is a flawed strategy, and the longevity math is the reason. The financial mechanic to understand here is time-weighted compounding. A dollar saved at 30 has roughly 35 years to compound before a traditional retirement age. A dollar inherited at 65 has zero. Same dollar, radically different value.

Run the numbers on a realistic case. Assume a 35-year-old expects a $300,000 inheritance and decides to save less today because of it. If that money instead arrived at age 35 and was invested at a 7% real return, it would grow to roughly $2.3 million by age 65. If it arrives at 65, it is worth $300,000. That difference is the entire retirement.

Now layer on the longevity problem from the other side. Your parents need that money to last. Carlson explained why retirees are tightening their grip: “people are freaked out and terrified they’re going to outlive their money.” A couple planning for a 30-year retirement spends differently than one planning for 20. Long-term care alone can run six figures a year. Assisted living, in-home aides, and memory care routinely consume what heirs assumed was their inheritance.

The variable that decides the outcome

The single factor that determines whether inheritance helps you is when it arrives relative to your own retirement date, and that is mostly out of your control. Two scenarios make the point.

Scenario one: parents pass in their late 70s, heir is 50, inheritance is $400,000. Invested for 15 years at 7%, that grows to roughly $1.1 million by 65. It meaningfully changes the retirement picture. Batnick described this version bluntly: “When people’s parents die and they just like immediately like 10x their life.”

Scenario two: parents live to 92, heir is 65, inheritance is $200,000 after end-of-life costs erode the estate. The heir is already retired, the compounding window is gone, and the money becomes a cushion rather than a foundation. Carlson’s framing fits: “threading the needle” becomes nearly impossible when you “don’t get the money until you’re 65.”

The hosts acknowledged knowing people who “live beyond their means and don’t save anything because they know that, that it’s, it’s coming.” That is the trap. You cannot underwrite a 40-year savings deficit with an inheritance that may arrive 30 years late and 50% smaller than expected.

What to do this week

1. Build the retirement plan assuming zero inheritance. Use the SSA.gov estimator for your Social Security baseline, then use any 401(k) provider’s projection tool to map your current savings rate to age 65. If the gap is uncomfortable, fix the gap with your own contributions, not someone else’s mortality.
2. Max the match, then push toward the IRS limit. The 2026 401(k) employee deferral limit is $24,000 and the IRA limit is $7,500. Every dollar captured in your 30s and 40s has 20 to 30 years to compound, which inherited dollars at 65 will not.
3. Have the conversation. Ask your parents directly whether they have long-term care insurance, a will, and a realistic spend-down plan. You are confirming there is a plan that doesn’t depend on them dying early, not asking for a number, just for evidence the plan exists.
4. If money does come, treat it as found money. Pay down high-rate debt, top off retirement accounts, and fund a taxable brokerage. Do not retrofit it into a lifestyle you built around expecting it.

Plan as if the inheritance will never come. If it does, it is a bonus. If it doesn’t, you still retire.