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 West Virginia, 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 trust's assets. These provisions restrict the beneficiary's ability to assign their interest in the trust to others, whether voluntarily or as collateral for a debt. Additionally, spendthrift trusts in West Virginia protect the trust's assets from being accessed by the beneficiary's creditors. This means that creditors cannot reach into the trust to satisfy the debts of the beneficiary. The spendthrift provisions are intended to protect the assets within the trust from both the beneficiary's potential reckless spending and from claims of creditors, ensuring that the trust's assets are used as intended by the grantor. West Virginia state statutes and federal law govern the creation and administration of spendthrift trusts, and an attorney can provide specific guidance on how to establish such a trust in accordance with state law.