A Spendthrift Provision, authorized under Texas Property Code §112.035, protects trust assets from a beneficiary’s creditors by preventing the beneficiary from assigning their interest and prohibiting creditors from forcing distributions before the trustee chooses to make them. This protection is strongest when the trustee has independent or discretionary authority over distributions, or when a beneficiary-trustee is limited to an ascertainable standard such as HEMS. While a spendthrift clause is effective against the creditors of third-party beneficiaries such as children or other heirs, it does not protect the trust assets from the settlor’s own creditors in a self-settled trust.
