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The Trump administration on Saturday launched its newborn investment program, called “Trump Accounts,” opening the federal savings accounts for millions of children in line with America’s 250th anniversary. Trump Accounts are available to anyone with a Social Security number under the age of 18. Qualifying children born between Jan 1, 2025, and Dec. 31, 2028, are also given a one-time deposit of $1,000 if enrolled in the program.
More than six million of the “Trump Accounts” have been opened to date, and 1.4 million of those will receive the seed contribution for babies born during President Trump’s second term, according to the Treasury Department.
Roughly 86 percent of accounts that have been opened belong to families earning less than $200,000 per year.
“It’s a beautiful thing,” Trump told CNBC earlier this week. “It’s a child has had no money, and when that baby becomes a man or a woman, they can have hundreds of thousands of dollars, maybe more.”
The money belongs to the child but generally cannot be accessed until after their 18th birthday. Prior to that, the account is controlled by parents or legal guardians.
Funds may be used without penalty for certain expenses such as education, beginning business ventures or making a down payment on a first home. Otherwise, the accounts are treated similarly to retirement accounts and remain subject to taxes and withdrawal conditions.
The accounts function like traditional IRAs, allowing money to grow tax deferred. They also allow investments into U.S. stock index funds or exchange-traded funds (ETFs). The default investment for the accounts will be an ETF tracking the performance of the S&P 500, according to the Treasury.
The administration has pitched the accounts as a way to expand stock ownership and create long-term wealth for children, estimating that accounts with the initial $1,000 seed at birth could be worth $6,000 at age 18.
The program, which is tied to the broader Working Family Tax Cuts signed into law by Trump, is estimated to cost $17 billion through 2028, according to the nonpartisan Committee for a Responsible Federal Budget.
Parents and families can make contributions to the accounts, but will not receive tax deductions for their contributions. Employers may also make pre-tax contributions to the accounts of an employee’s child, tax-free to the employee.
It has attracted support from numerous donors and private companies. More than 50 companies, including Uber and Intel, have announced plans to contribute to employees’ children’s Trump Accounts.
Trump told CNBC that he expects billionaire Elon Musk’s SpaceX to donate stock to the accounts, though Musk has not publicly confirmed this.
The Michael & Susan Dell Foundation also pledged $6.25 billion for additional deposits into the accounts of low-income children that do not qualify for the federal $1,000 contribution.
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