TL;DR
- Plan as though no inheritance is coming
- Model a second, conservative upside scenario
- Don’t let hypothetical money drive real decisions
- Treat inheritance as margin, not necessity
- Reassess only when the money is real
People don’t usually get into trouble planning for an inheritance because they’re greedy. They get into trouble because future money quietly starts doing emotional work in the present.
It shows up subtly. Someone saves a little less aggressively. Feels more comfortable carrying risk. Makes decisions that only work if the money eventually arrives. No one says this out loud, but the plan begins to lean.
The problem is that inheritance is, by nature, uncertain — even when everyone involved is acting in good faith.
Why Inheritances Are More Uncertain Than They Appear
Most inheritances don’t change because of bad intentions. They change because life intervenes.
Healthcare costs rise. Long-term care enters the picture. Markets move. Taxes apply. Estate mechanics matter. Family dynamics matter more than people expect. What once looked like a stable number becomes conditional over time.
This is why the real planning question isn’t how to plan for an inheritance. It’s how to build a plan that doesn’t require one.
The Two-Scenario Framework That Actually Works
In practice, the cleanest approach is to hold two versions of reality at the same time.
Scenario A assumes no inheritance arrives at all.
Retirement still works. Lifestyle still works. Nothing breaks. This is the plan that matters most, because it’s the one you actually control.
Scenario B allows for an inheritance—but at a conservative level.
Not the best-case number. Not the number mentioned years ago. A reduced figure that assumes time, taxes, costs, and friction will do what they usually do.
If the number in your head is a million, plan for half.
If it’s half, plan for less.
The goal here isn’t precision. It’s independence.
Why Conservative Estimates Matter More Than Accuracy
Inheritance planning tends to fail when hypothetical money starts stabilizing real decisions.
People save less aggressively.
They spend with more confidence than their balance sheet supports.
They tolerate financial exposure they would otherwise reject.
Timing is what breaks most inheritance assumptions. Money often arrives later than expected, unevenly, or in a form that takes time to unwind. Sometimes it arrives with emotional or administrative weight that limits what can be done with it when it matters most.
Lowballing the estimate isn’t pessimism. It’s how you keep the plan from becoming fragile.
Where an Inheritance Belongs in a Real Financial Plan
An inheritance should sit in a financial plan as contingent upside, not as a structural pillar.
If it arrives, it improves optionality. It may allow for earlier retirement, more flexibility, or greater margin. What it should not do is hold the structure together.
Only when assets are legally transferred and usable does it make sense to revisit the strategy — tax planning, investment allocation, and estate considerations. Until then, the money stays off the psychological balance sheet.
When Professional Guidance Is Actually Useful
This kind of planning isn’t about optimization. It’s about restraint.
A good advisor doesn’t help you engineer a future around money you don’t yet have. They help you build something that stands on its own, and then adjust when circumstances change.
That distinction matters more than most people realize. Good financial planning doesn’t rely on future rescue.
It works first.
Then it adapts.
That order matters.
People Also Ask
How do you plan for an inheritance when you don’t know the amount?
You plan two scenarios: one where no inheritance arrives at all, and one where a conservative amount does arrive. Your financial plan must work fully in the first scenario before the second is allowed to matter.
Should you count an inheritance in your retirement plan?
An inheritance should never be a core assumption in a retirement plan. It can be modeled as a separate upside scenario, but your retirement should not depend on it.
Is it risky to rely on a future inheritance?
Yes. The primary risk is timing. Inheritances often arrive later than expected, unevenly, or with restrictions that limit usability when the money is needed most.
What is a conservative way to estimate an inheritance?
A conservative estimate assumes taxes, healthcare costs, long-term care, and market changes will reduce the amount. Many planners model 50% or less of the expected figure.
When should an inheritance be added to a financial plan?
Only after assets are legally transferred and accessible. Until then, inheritance should be treated as hypothetical and excluded from core decision-making.