Estate Planning Essentials for Bay Area Professionals: Know What You Own and How It Transfers

For many mid-career professionals in the San Francisco Bay Area, the financial picture becomes increasingly complex with age — RSUs, investment accounts, real estate, business equity, and more. Yet far too often, the estate plan doesn’t keep up. If your wealth isn’t structured thoughtfully, your legacy could be diminished by unnecessary taxes or confusion for your loved ones.T hat’s why now is the time to take a closer look at what you own, how it transfers, and how recent law changes like the SECURE Act 2.0 impact your plan.

Understand What You Own — and How It Transfers

A living trust is a great start, but it doesn’t cover everything. For example:

• IRAs,     401(k)s, and life insurance transfer by beneficiary designation, not     through your trust.
• RSUs     (stock options), brokerage accounts, and real estate may or may not be     titled in the trust.
• Tax     treatment differs widely — some assets get a step-up in basis, others     (like pre-tax retirement plans) could create a significant income tax bill for your heirs.

Don’t assume your documents are doing the job. Review account ownership, trust titling, and tax implications to ensure your intentions are actually implemented.

Build a Comprehensive Estate Plan for California

An effective estate plan in California should include:

• Revocable  living trust to avoid probate
• Will  to appoint guardians and handle non-trust assets
• Financial power of attorney for incapacity planning
• Advance healthcare directive to guide medical decisions
• HIPAA authorization for access to health information
• Pour-over will to “catch” stray assets

California Note: There’s no state estate tax, but the state’s high income tax rates can make retirement account inheritance more costly, especially under SECURE Act rules.

The Role of Beneficiary Designations in Estate Planning

Beneficiary designations are a critical but often over looked part of a comprehensive estate plan. Unlike assets held in a living trust or passed through a will, certain accounts and policies transfer directly to named individuals—outside of probate—through beneficiary designations.

What Types of Assets Use Beneficiary Designations?

Beneficiary designations typically apply to:

• Retirement  accounts (e.g., IRAs, 401(k)s, 403(b)s, 457 plans)
• Annuities
• Life  insurance policies
• Transfer-on-death  (TOD) brokerage accounts
• Payable-on-death  (POD) bank accounts
• Some stock options and equity compensation plans

Why They Matter So Much

1. They override your trust or will.
       If your will says one thing but your beneficiary form says another, the beneficiary     form controls. This can create unintended consequences if not kept     up to date.
2. They avoid probate.
       Assets with proper beneficiary designations typically transfer directly to     the named beneficiary, bypassing the probate process entirely. This saves     time, legal expense, and paperwork.
3. They  impact taxes.
       Especially under the SECURE Act, inherited retirement accounts must often     be distributed within 10 years, which can create large taxable events.     Choosing the right beneficiary — and planning for how distributions will     be taxed — is key.

When to Review Beneficiary Designations

• After life changes (marriage, divorce, birth, death)
• When you create or update your trust or estate plan
• If you change jobs or rollover old 401(k) plans
• Periodically — at least every 2–3 years

Common Pitfalls to Avoid

• Naming a deceased or ex-spouse as a beneficiary
• Leaving beneficiaries blank or defaulting to your estate (which can trigger probate and reduce tax efficiency)
• Naming minor children directly, without a custodian or trust
• Forgetting to coordinate with your living trust and estate plan

California-Specific Considerations

In California, community property laws can affect howspousal rights apply to retirement accounts and life insurance. If you’remarried and change a beneficiary to someone other than your spouse, spousalconsent may be required depending on the account type and provider.

Stay Current with Law Changes and Life Changes

Estate planning isn’t one-and-done — especially not intoday’s legal environment. Consider the following:

SECURE Act 2.0 (Federal)

• Most non-spouse beneficiaries must now empty inherited IRAs within 10 years, potentially accelerating taxes.
• RMD ages have shifted — now 73, increasing to 75 for younger cohorts.

Organize and Communicate

Your estate plan is only as good as your loved ones’ ability to understand and access it.

• Print and scan key documents (trusts, statements, deeds, policies)
• Store them securely and digitally
• Tell your spouse, adult children, or trustee where to find them
• Keep a secure file of login credentials for digital accounts

Revisit and Discuss

Estate planning is part legal and part emotional. Proactive, transparent conversations with your loved ones can help avoid confusion, resentment, or unintended outcomes.

Discuss:

• Who's in charge of your finances and healthcare if you're incapacitated?
• Who inherits what — and why?
• Are there any assets going to charity, minor children, or special needs family     members?

Final Thoughts: The Most Important Step Is Starting

Whether you’re maxing out retirement contributions, managing equity comp, or planning for aging parents, your estate plan connects your financial life to your family’s future. A solid estate plan connects your hardwork to the legacy you want to leave.

This summer, use the quieter moments to take stock — and take action. Because the cost of not planning well often isn’t just financial —it’s personal.

Need a Second Set of Eyes?

At Collabria Capital, we work with mid-career professionals across the Bay Area to ensure their financial and estate plans reflect both intentionality and clarity. If it’s time for a second set of eyes — or to finally get your planning started — we’re here to help.

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