A trader rings the opening bell of the New York Stock Exchange (NYSE) from the Oval Office in New York on July 6, 2026, to celebrate the first day of trading for the Trump accounts
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Americans have a new way to invest in their children’s future: Trump accounts opened over the weekend. Congress approved it last year as part of the One Big Beautiful Bill Act, the Republican tax and spending bill. They work similarly to retirement accounts, but are not intended for adults preparing for their senior years, but rather to help children start their adult lives.
The money in these accounts is invested in an index fund that largely tracks the stock market. Any American citizen under the age of 18 can have an account, and once they turn 18, they can access this money to do things like get an education or buy a house. (The money can also be used for other purchases, but this will incur a tax penalty.)
The accounts act as a kind of digital “donation bucket” to which many people can donate – the children’s families, but also philanthropists, their parents’ employers and even the government. Contributions from family members and other adults in the children’s lives are made in after-tax dollars; Contributions from others, such as employers or the government, are before taxes. The child does not have to pay taxes on the growth of the investment until they withdraw the financing.
But there are already plenty of other options for parents to invest in, from education savings plans to their own retirement accounts. So should you sign your family up for Trump accounts? Here are four things to keep in mind.
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Your child could get free money from the federal government
If you have a child born between 2025 and the end of 2028, financial advisors say signing up for a Trump account should be an easy decision for one reason: The child’s account automatically receives a $1,000 seed contribution from the federal government.
Financial planner Michael Reynolds of Indiana-based Elevation Financial did the math for Morning Edition and said that even without additional investments, $1,000 would turn into nearly $4,000 by the time a child turns 18. (This assumes a return of 8% and does not take into account the income tax that must be paid on the growth and the initial federal contribution.)
Your child may be eligible for other donations
Children born outside this window are not completely unlucky. Millions of them under 11 still receive $250. That comes from more than $6.25 billion donated by Michael and Susan Dell of Dell Technologies.
This money only goes to children who are not entitled to the federal contribution. To qualify, their families must also live in ZIP codes where the median family income is below $150,000.
And if your children aren’t eligible for the Dell donation, there are other options you might consider.
Some companies also offer contributions, such as the memory chip manufacturer Micron. The company will donate $250 to up to one million children living near some of its locations in states such as Minnesota, California and New York to support the local workforce and community. Micron also matches employees’ donations to their own children’s accounts, up to $1,000 per child.
Other companies, including Mastercard, Uber and Visa, also offer matches to their employees.
This also includes some small companies. “We’re going to give it a try,” said Luke Delorme, co-owner and director of financial planning at financial firm Tableaux Wealth. “Maybe it will fit into their financial picture in a meaningful way in the future.”
First, think about your own retirement planning
Parents should also prioritize their own retirement before investing money for their children’s retirement, said Carrie Joy Grimes, CEO of nonprofit personal finance company WorkMoney.
She suggests that parents max out their own retirement accounts before other options, “because what happens is we put money into our kids’ things and then we end up needing help in retirement — and that’s a much worse financial burden on our kids.”
Your children can also benefit from a 529 education plan
Parents can now invest in their children’s future through 529 savings plans. As with Trump accounts, family members can contribute to these plans with after-tax dollars. However, there are differences. First, 529 plans allow children to withdraw the money tax-free. And secondly, this money can only be used for education.
Parents can choose both. Financial advisers say how families can benefit from Trump accounts depends on their financial situation. For wealthier families with parents who can already afford to max out their retirement accounts and put money aside in a 529 account, Trump accounts are essentially an additional tax benefit for their children.
Ray Boshara, a senior policy advisor at the Aspen Institute, says low-income families will particularly benefit from this digital donation bucket that they can use to collect contributions for their children. These children could potentially start their adult lives with thousands of dollars they otherwise would not have had.
“These accounts will be transformative for them,” Boshara says.
Note: Dell Technologies is a financial supporter of NPR.
https://www.npr.org/2026/07/08/nx-s1-5884855/trump-accounts-what-to-know
