Spendthrift Trust

CFA Level III Portfolio Management
#1

So we have 4 attributes for trusts: fixed or discretionary and irrevocable or revocable which you can mix to set up an appropriate trust.

How does the spendthrift trust fit in here? Is it another form of trust or is it simply stating a specific intend that is behind a trust. From the Schweser description: is used to transfer assets to a beneficiary who is too young or otherwise unable to manage the assets. Additionally, settlor retains some control over distribution.

To me it sounds like it can be any of the trust above which can be used to transfer the assets to somebody too young. Or is it another, separate type of trust specifically designed for transferring assets while retaining some control?

#2

Appears to be a description of a specific use of a trust. Wikipedia also mentions that it’s typically an irrevocable trust that protects the beneficiary (who could be too young) from credit claims until the holdings are distributed. It’s like a clause that’s written in the trust documents.

#3

So that sounds very much like an irrevocable discretionary trust, doesn’t it?

#4

So that sounds very much like an irrevocable discretionary trust, doesn’t it?

#5

Yeah basically. It could appear in another form so the gist of it is that it’s a type of trust with a specific goal (beneficiary too young or unable to manage assets).