Anytime you depend on someone else, you run the risk of that person not coming in for you; when it comes to retirement, you do not want to depend on anything except for your own work. You don’t want to depend on inheritances, you don’t want to depend on Social Security, and you don’t want to depend on pensions. Ask the employees of Delta whether they would still depend on a pension, or the employees of Enron or Worldcom; likely the answer would NO because their pension funds are gone, replaced by pennies on the dollar insurance payout from the Pension Benefit Guaranty Corporation (PBGC).
Inheritances, which was the focal point of the pitfall, are even trickier because your parents (or benefactor) may need that money for something. Sure, the account may look fat and happy now, but it just takes one medical issue to drain an account down to its last pennies. If it’s not in your account, it’s not yours and you can’t depend on it.
Source: Yahoo Finance