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 Louisiana, a spendthrift trust is a legal tool that allows a grantor to place restrictions on the beneficiary's ability to transfer their interest in the trust. This type of trust includes a spendthrift provision that prevents the beneficiary from assigning their interest to others, whether voluntarily or involuntarily, such as using it as collateral for a loan or in the event of a creditor's claim. The purpose of a spendthrift trust is to protect the trust assets from being squandered by a beneficiary who may not be financially responsible. Louisiana law recognizes the validity of spendthrift trusts under the Louisiana Trust Code, which provides the framework for the creation and enforcement of such trusts. The spendthrift provision is enforceable against most creditors, except in certain situations such as claims for child support, alimony, or if the trust was established to defraud creditors. It's important to note that the specific rules and limitations regarding spendthrift trusts can be complex, and an attorney with expertise in trusts and estate planning should be consulted to ensure that a trust is properly established and meets the grantor's objectives.