The One, Big, Beautiful Bill has created a new investment account for kids and it’s now available. However, these new financial plans come with limitations and are therefore not for everyone.
On America’s birthday, President Donald Trump announced a new path for the next generation of investors to achieve the American dream, but many people don’t know about it or haven’t signed up yet.
“I heard he might want to give kids money for college?” said Sanchita Krishna of Stamford, Connecticut.
Asked about the Trump accounts, Megan McCarter of Greenville, South Carolina, said: “My kids are grown, but if I had a newborn I would absolutely do it and be thrilled.”
“Yes, I’m definitely opening an investment account for my son. I just hope the money comes through,” said Vania Hoyte of Philadelphia when asked if she would open an account for her child.
Most parents of newborns don’t think about their baby’s retirement, but if you do, there’s a big, lovely bonus.
While any child under 18 is eligible for a Trump Account, children born between January 1, 2025 and December 31, 2028 who are U.S. citizens can receive a $1,000 deposit into their account, which has an annual contribution cap of $5,000.
“To date, more than 6.5 million American children have signed up for accounts,” White House press secretary Karoline Leavitt said Thursday.
The rules for Trump accounts include that children do not have access to them until their 18th birthday. Penalty-free withdrawals are limited to education, purchasing a home, and starting a business. Otherwise, individuals aged 59 and over can withdraw money without penalty
“We’re still seeing less than half of those eligible enrolled. I think that has a lot to do with the fact that it’s an opt-in program that’s not automatic, meaning families still had to take steps to actually enroll their child and then activate their account…It’s important that new programs really include people with lower incomes and lower wealth,” said Madeline Brown, senior policy associate at the Urban Institute.
Some parents who tried to register their children received an email saying their child was ineligible.
There are delays. Some babies with newly issued Social Security numbers may not yet qualify, and some parents have had success after applying multiple times or online.
“The starting capital of $1,000 is free money, it’s hard to argue with that,” said Sam Taube, lead investing writer at Nerd Wallet.
According to Taube, other accounts such as 529 college savings plans, custodial IRAs and custodial Roth IRAs are also available to parents.
Remember. If someone asks you to pay money to receive the $1,000 donation from the U.S. Treasury, it is a scam. Here is the link to the official Trump Account website.
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