What is a spendthrift trust?

A spendthrift trust is a type of trust that is used to protect assets from creditors. This type of trust is often used in California for asset protection purposes. In a spendthrift trust, the assets are placed in trust and administered by a third party, called a trustee. The trustee can only use the trust funds for the benefit of the person(s) named in the trust, who are called the beneficiaries. The trust is “spendthrift” because it limits the ability of the beneficiary’s creditors to reach the assets in the trust. This means that the trust assets cannot be taken by creditors to satisfy the beneficiary’s debt. Even if the beneficiary decides to give away or spend all of the trust assets, the creditors can still not access them. In addition to offering asset protection, a spendthrift trust can also provide long-term financial security. The trustee can manage the trust funds and make investments on behalf of the beneficiary, and can provide a source of income for the beneficiary’s lifetime or a set number of years. Overall, a spendthrift trust is a valuable tool for asset protection in California and can provide long-term financial security for the beneficiaries. It can also help keep the assets safe from creditors, which can be a major concern for many people.

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What is a spendthrift trust?

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