What Are Trump Accounts?

Parents who teach their children about money – how it is earned, saved, and invested – and how compound interest can work for their benefit. By doing so, parents can strengthen their family, community, state, and nation. President Donald Trump’s “Big Beautiful Bill” contains an innovative policy can be helpful to some parents, as explained Carrie Sheffield. 

President Donald Trump announced an innovative policy within his “Big Beautiful Bill,” a measure that would create $1,000 savings accounts, known as “Trump Accounts,” for each U.S. citizen born between Jan. 1, 2025, and Jan. 1, 2029, although the accounts may be renewed for future babies.

Cash for these Trump Accounts would be deposited into a private custodial investment account and grow tax-free until the child reaches adulthood. Parents, churches, charities, and employers can also contribute up to a combined $5,000 annually. At age 18, the young adult can access half the funds for collage or skills training, to start a business, or toward a home down payment.

David Solomon, CEO of Goldman Sachs, visited the White House, alongside other business leaders, to praise the accounts. “This initiative gets at the core of binding those future generations to the benefits and the potential of America’s great companies and markets. Early childhood investments have far-reaching benefits,” Soloman said. “Our economy’s future vitality is dependent on young people understanding the power of investing for the long term.”

Solomon’s right. Trump Account are an intriguing idea for many reasons, including helping children begin saving immediately. It encourages financial literacy since people will be able to watch as the value of their accounts grows through the power of compounded interest.

The proposal requires that Trump Account money must be invested in a low-cost, diversified U.S. stock index fund or equivalent (for example, the S&P 500). [Estimated amount in account after 20 years is an average of $8,300, or $50,000 by age 18 with just an additional amount of deposits of $750.] …

… Trump accounts would democratize investing through their universality. Every U.S.-born child with parents who both have Social Security numbers with work authorization would qualify for Trump Accounts.

Children of all income levels and ZIP codes qualify, an improvement from the current only 2 out of 3 Americans owning stock and retirement accounts…. Stock-owning households are generally higher earners with more education. Just 38% of Hispanics, 52% of black Americans, and 28% of those earning below $50,000 own stock.

True to his campaign promises, Turmp Accounts would shatter barriers between “elites” and the working class….

Trump Accounts hold great promise to instill economic literacy for children from all backgrounds. If signed into law, parents, teachers and other caring adults have a golden opportunity to empower children for a lifetime.

The “Big Beautiful Bill” has numerous positive policies. Trump Accounts is one way that the rising generation can get a head start on financial life. Wise parents will support Congress in passing the bill and in helping their children to gain financial education. In doing so, they will strengthen not only their family but also their community, state, and nation.