A spendthrift trust is a trust in which the person who makes the trust and places property or assets in it (the grantor, settlor, or trustor) includes a provision that prohibits the beneficiary’s interest in the trust from being assigned to another person or entity—whether as a gift or as collateral for a loan or debt—and prevents a creditor from reaching or attaching the beneficiary’s interest in the trust.

A spendthrift is a person who spends money wastefully or foolishly and a spendthrift provision in a trust (a spendthrift trust) is designed to preserve the trust’s assets and protect the beneficiary from the beneficiary’s spendthrift ways.

In Arkansas, a spendthrift trust is a legal tool that allows a grantor to place assets in a trust with specific provisions that prevent the beneficiary from squandering the assets. Arkansas law recognizes the validity of spendthrift provisions in trusts, which are designed to protect the trust's assets from the beneficiaries' creditors and from the beneficiaries themselves if they are not financially prudent. Under Arkansas Code Title 28, Chapter 73, which is the Arkansas Trust Code, spendthrift provisions are enforceable to restrict voluntary and involuntary transfers of a beneficiary's interest. This means that beneficiaries cannot use their interest in the trust as collateral for loans, nor can creditors typically reach these assets to satisfy debts. However, there are exceptions to this protection, such as claims for child support, alimony, or other specific types of creditors as defined by state or federal law.