A spendthrift trust is a legal instrument that holds property for a beneficiary but contains clauses preventing that beneficiary from actually exercising control over the trust property, explains BNY Mellon. The beneficiary normally cannot access or sell trust assets without the approval of a separate individual or corporate trustee.
People who establish trusts to transfer assets to future generations commonly include spendthrift provisions to protect those assets, according to BNY Mellon. Because the beneficiary does not actually control the trust's assets, the beneficiary's creditors typically cannot access or attach assets in a spendthrift trust. Some people also establish spendthrift trusts to benefit beneficiaries who are unable to prudently manage money on their own, according to Attorneys.com.