Securing Your Legacy: A Practical Guide to Estate Planning
- Gustaf Rounick, CFP®, ChFC®
- Jul 12, 2025
- 6 min read
Updated: Jul 16, 2025
The Purpose of Estate Planning
Estate planning is simply the exercise of making sure what you worked so hard to build ends up in the right hands, at the right time, with as little cost, tax, and family conflict as possible. Far from being an ivory-tower exercise, it is a practical part of day-to-day wealth management for families of every size in Los Angeles and beyond. Because Westlight Wealth is a fiduciary financial advisor, not a law firm, what follows is general educational information; always review the legal details with a qualified attorney and the tax angles with your CPA before acting on anything you read here.
What Counts as Your Estate?
When people hear “estate,” they often picture mansions and private jets, yet your estate is simply everything you own—your home, bank and brokerage accounts, retirement plans, life insurance, business interests, digital photos, even that vintage guitar. Estate planning means documenting who will manage or inherit those assets if you become incapacitated or after you die, and doing so in a way that lines up with your goals for your family, favorite charities, and the next generation of business leadership.
The Pitfalls of Probate
Without a plan, California’s probate court steps in. Formal probate typically involves three phases—opening the estate, administering it, and closing it—and often lasts nine to eighteen months, with court fees and public filings along the way [1] Self-Help Guide to the California Courts. During that time heirs may have limited access to assets, and family matters—such as who gets the beach house—become part of the public record. A thoughtful plan can minimize or even bypass probate, saving time, money, and privacy.
The Estate-Tax Landscape in 2025
Taxes are another reason to plan ahead. Thanks to the 2025 One Big Beautiful Bill, the federal estate-tax exemption is now $15 million per person, or $30 million for a married couple who use portability [2] Kiplinger. Only the value above that line faces a federal estate tax rate that can climb to 40 percent, but it is a mistake to assume your estate will never reach the threshold. Real estate values, concentrated stock positions, and a family business can appreciate faster than you expect. Moreover, several states impose their own estate or inheritance taxes with much lower exemptions, so a California family that owns property in Oregon or Massachusetts may face additional levies.
Gifting While Living
Federal gift-tax rules give you a powerful tool for moving wealth out of your taxable estate during your lifetime. In 2025 you may give up to $19,000 per recipient each year without touching your lifetime exemption or filing a gift-tax return [3] IRS. Married couples can double that figure. Larger gifts simply chip away at the same $15 million lifetime shield discussed above, and current IRS regulations confirm that using today’s higher exemption will not be “clawed back” if Congress ever lowers the threshold. Strategic gifting—whether outright, in trust, or through vehicles such as 529 education plans—lets you see your loved ones benefit while you are here to enjoy it with them.
Stepping Up Basis for Heirs
A key income-tax concept is the “step-up” in basis for inherited property. At death, most assets re-set their cost basis to fair market value, so heirs can sell without realizing the decedent’s capital gains. Done thoughtfully, this can erase decades of embedded appreciation on a highly appreciated primary residence or a tech stock you purchased during an IPO [4] IRS. Sometimes the smartest move is holding instead of gifting so your heirs receive that step-up.
Wills vs. Living Trusts
The backbone of most plans is a last will and testament. Your will appoints an executor (in California, a “personal representative”) and spells out who gets what. If you have minor children, the will is also where you nominate a guardian should something happen to you and their other parent. A will alone, however, does not avoid probate. That is why many Westlight Wealth clients rely on a revocable living trust. You re-title major assets—your house, taxable investment accounts, small-business interests—into the trust, and because the trust continues after your lifetime, there is generally nothing for the probate court to administer. You can change the trust at any time while you are alive and well; after death it becomes irrevocable, locking in your wishes.
Documents for Incapacity Planning
Two additional documents protect you, not just your heirs, while you are alive. A durable power of attorney names someone to handle finances if you cannot, and an advance health-care directive (sometimes bundled with a HIPAA release) spells out your medical wishes and chooses who can speak to doctors on your behalf. Many clients also prepare a separate letter of instruction covering passwords, digital assets, and personal items of sentimental value that may not rise to the level of a legal bequest.
Tune-Up Your Beneficiary Forms
Beneficiary designations on retirement plans, life insurance, and certain brokerage accounts bypass both the will and a living trust. Because a designation controls over anything written elsewhere, keeping these forms current is critical. A divorce decree does not automatically remove an ex-spouse from an old 401(k). Westlight Wealth reviews these forms line by line during our annual client check-ins.
Planning for Business Owners
Business owners face additional complexity. Your company may be the most valuable—and illiquid—asset in the estate. A succession or buy-sell agreement funded with life insurance can create cash for surviving partners or heirs and establish a market value for the shares. Likewise, real-estate investors often use LLCs to hold property inside a living trust, adding asset-protection benefits and easing transfer at death. Charitably inclined owners can marry a planned liquidity event with strategies such as charitable remainder trusts, donor-advised funds, or a private foundation to reduce income and estate taxes while benefitting causes they love.
Our Collaborative Planning Process
At Westlight Wealth we approach estate planning as a multi-step, collaborative process. In our first discovery meeting we inventory assets, identify goals for each heir, and surface sensitive issues—second marriages, special-needs beneficiaries, or estranged relatives. Next we model how cash flow, taxes, and investment growth intersect with various estate-tax scenarios, so you can see the real-world impact of each design choice. Then we coordinate with your attorney to draft or update documents, and with your CPA to confirm any lifetime gift strategy. Finally, we handle the paperwork to retitle accounts, update beneficiary forms, and set automatic reminders for periodic reviews. This holistic, fiduciary approach keeps your estate plan aligned with your retirement, investment, and philanthropic goals.
Updating Your Plan Over Time
Estate plans are living documents. Marriage, a child’s birth, a home purchase, a liquidity event, or simply a change of heart can all trigger the need for updates. As your Los Angeles financial advisor, we recommend a high-level review every year and a full legal review at least every five years, sooner if Congress revises tax law. We also encourage storing signed originals in a fire-resistant location and providing digital copies to key fiduciaries. Clear communication now prevents confusion later.
Myth Busting: Common Misconceptions
Several myths can derail families. “I’m too young,” “I don’t have enough money,” or “Everything will go to my spouse anyway,” are common—and risky—assumptions. Hard experience shows that lack of planning often hits modest estates the hardest, because court costs and family friction eat a larger percentage of what is left. The good news is that even a simple plan offers powerful protection, and you can layer on more sophisticated tools—such as dynasty trusts, irrevocable life-insurance trusts, or grantor-retained annuity trusts—only if and when they make economic sense.
Your Next Step with Westlight Wealth
Estate planning is not a one-size-fits-all exercise; it is a tailored roadmap designed to protect your wealth, your wishes, and your loved ones from unnecessary cost, delay, and conflict. Westlight Wealth is here to guide the financial side of that roadmap and to coordinate with the attorneys and accountants who turn it into legally enforceable peace of mind. If you would like to begin—or refresh—your plan, schedule a complimentary consultation today. Together we can align your estate strategy with your broader goals for retirement planning, charitable giving, and tax-efficient investing.
Gustaf Rounick, CFP®
Disclaimer: Westlight Wealth provides investment advisory and financial-planning services. We are not attorneys or tax professionals and do not provide legal or tax advice. This article is for educational purposes only. Always consult a qualified attorney and tax advisor regarding your specific situation before implementing any estate-planning strategy. Investing involves risk, including possible loss of principal. Past performance does not guarantee future results.
Works Cited
[3] https://www.irs.gov/faqs/interest-dividends-other-types-of-income/gifts-inheritances/gifts-inheritances-1
