Estate Law Questions? Ask an Estate Lawyer.
Good afternoon. There is absolutely nothing wrong with this plan. Especially in CA where the probate process can be expensive and burdensome. It's exactly what I would propose with regard to the living trust. BUT, you want to transfer these assets into your trusts before your death. The trusts are revocable so you have full control over the assets, but if you wait until death, you will not avoid the probate process because the assets have to go through your will.
You only have your will in case you fail to transfer something into your living trust during life. I would also suggest you each have a Durable General Power of Attorney, a Durable Medical Power of Attorney, and a Directive to Physicians for your end of life decisions in the event of a terminal or irreversible condition. These documents are to handle situations during your life when you become unable to act on your own behalf.