The Trump Accounts program, launched earlier this year, automatically enrolled every eligible child in the United States, marking a significant expansion from the roughly 8 million accounts initially opened since the program’s debut in July. President Trump announced on Wednesday that 70 million children with valid Social Security numbers now have Trump Accounts, investment savings accounts designed to build wealth on behalf of children up to age 18.
The Treasury Department clarified that although the accounts are automatically established, parents or legal guardians must formally activate them to access benefits, including a one-time government seed contribution of $1,000 for some newborns. This government contribution is available to U.S. citizen infants born between January 1, 2025, and December 31, 2028, corresponding with Trump’s current term. Parents of older children who open accounts will not qualify for the government seed money but may be eligible for a $250 contribution funded by private investors. Contributions beyond that must come from families or other sources such as employers, relatives, and philanthropic organizations.
Trump Accounts are managed by private banks and brokerages and invest money in the stock market. Initial program rules limited investments to broad index funds, but a recent update from the Treasury Department now allows eligible wealthy donors to contribute stock in individual companies. Experts note this change could encourage more substantial donations from investors who may have fewer liquid assets but significant holdings in company shares. However, individual stocks carry greater volatility than index funds, and families do not control which stocks may be donated on their behalf.
Funds in Trump Accounts are generally inaccessible until the beneficiary turns 18, except under limited circumstances. At that point, account holders can use the money for a range of purposes including education, buying a home, or starting a business. Options also include rolling over the investments into a Roth IRA, allowing earnings potentially to grow tax-free until retirement, though taxes would apply upon such a rollover.
Trump Accounts sit alongside other savings options such as 529 college savings plans and custodial brokerage accounts. While 529s offer tax-free growth and are restricted to educational expenses, custodial accounts provide flexibility without contribution limits but are fully taxable. Financial experts suggest the choice of savings account depends heavily on family goals, with 529 plans remaining the preferred vehicle for education funding.
Proponents of Trump Accounts emphasize the program’s potential to introduce children—including those from low-income families—to the stock market and long-term wealth building. However, some critics argue the program may exacerbate economic inequality, noting that government contributions cannot fully offset reductions to other assistance programs such as food aid and Medicaid. Wealthier families are more likely to maximize contributions, potentially widening the wealth gap despite the program’s universal enrollment approach.
Experts acknowledge the accounts provide a new investment tool with notable tax advantages but caution participation may be uneven due to activation requirements and additional investment needs. According to Nathan C. Goldman, a professor of accounting, while the $1,000 seed money aims to make the program inclusive, only some families will have the resources to fully leverage the accounts' potential over 18 years of saving.