A trust, the purpose of which is to stop creditors of the beneficiaries from reaching the income or principal while it is in the hands of the trustee, is called a
A)living trust.
B)spendthrift trust.
C)living will.
D)testamentary trust.

Question

A trust, the purpose of which is to stop creditors of the beneficiaries from reaching the income or principal while it is in the hands of the trustee, is called a​
A)living trust.
B)spendthrift trust.
C)living will.
D)testamentary trust.

Quizplus · Accepted Answer

A spendthrift trust is specifically designed to protect the trust's assets from being claimed by creditors of the beneficiaries by restricting the beneficiaries' access to the trust's principal and income, which is controlled by the trustee.

A Trust, the Purpose of Which Is to Stop Creditors