Jumpstart Your Child’s Financial Future with a Trump Account
A new, tax-advantaged investment account, created under the One, Big Beautiful Bill Act of 2025, pledges to build long-term financial security for millions of children in the United States.
Popularly known as Trump Accounts, these custodial, tax-advantaged Individual Retirement Accounts (IRAs) are modeled after traditional IRAs with a few, key differences – the biggest being that any U.S. citizen born between 2025-2028 will receive a one-time $1,000 contribution from the United States Treasury to jumpstart their savings efforts!
To sign up for an account, parents (or other qualified, legal guardians) can visit trumpaccounts.gov, or simply fill out IRS Form 4547 when completing their 2025 taxes. The accounts will then begin the initial review/authentication process in May and will open to accept contributions on July 4.
Children born before last year are also eligible to hold an account if it is opened before the year in which the child turns 18; however, these account-holders are not eligible for the $1,000 contribution from the U.S. Treasury.
And thanks to generous donor support from Dell Technologies, children born between 2025-2028 will receive an extra $250. Totaling $6.25 billion, the pledge from the Dell family also includes a $250 contribution to account-holders age 10 and younger living in areas with average incomes below $150,000.
The funds deposited into the Trump Accounts are automatically invested into American-owned companies’ stocks and offer parents and children the opportunity to not only build a strong financial future, but to learn about the power of investing and compounding interest in real-time – together.
Speaking of compounding interest, there are no additional contributions required after the initial deposit, but parents (or legal guardians), friends, family members, and/or participating employers can choose to deposit up to an additional $5,000 each year to maximize the account’s growth.
Based on data and average return rates from the stock market’s historical performance, it could mean the difference between $4,000 when children are eligible to withdraw the funds at age 18, or $190,000!
Using the Compound Interest Calculator from investor.gov as an example of the power of compounding interest, let’s review the differences between investing only the initial $1,000 seed amount and compare it with depositing an additional $5,000 each year until the account is eligible for withdrawal.
Keep in mind, these estimates are for illustrative purposes only and not an actual guarantee of market performance.
The initial $1,000 invested upon account opening grows at an estimated return rate of 8% Annual Percentage Yield (APY), with a comparison between the original contribution and projected future growth.
When the account becomes eligible for withdrawal, this means a total account growth amount of $3,996.02.
The initial $1,000 invested upon account opening is supplemented with an additional $416 per month – or $4,992 annually – and grows at an estimated return rate of 8% Annual Percentage Yield (APY), with a comparison between the original contributions and projected future growth.
When the account becomes eligible for withdrawal, this means a total account growth amount of $190,947.64!
As you can see from comparing the two different contribution amounts, that’s a huge difference in growth between the two accounts.
Don’t miss out on this opportunity to jumpstart your children’s financial future and teach them all about the importance of saving and investing.
Speak with your investment adviser, go to trumpaccounts.gov, or complete Form 4547 when completing your taxes to sign up today!
Frequently Asked Questions
How do I open an account?
Visit trumpaccounts.gov, or complete Form 4547 when completing your 2025 taxes.
Who is eligible to sign up?
All U.S. children born before 2025 with a valid Social Security Number are eligible to sign up for an account. Children born between 2025-2028 will receive a one-time $1,000 contribution to initially fund the account.
Who will manage the account?
Parents or legal guardians will open and manage the accounts on behalf of the child until he or she reaches 18.
How much can I contribute?
Friends, employers, and/or family members may contribute up to $5,000 per year. The one-time $1,000 contribution from the U.S. Treasury does not count against this limit.
Are my contributions taxed?
All contributions and earnings accumulated are tax-deferred, meaning funds are tax free until a withdrawal is made.
When can the funds be withdrawn?
Children may access the funds once they turn 18 at which time the account will be treated as a traditional IRA with normal tax rules – withdrawals made before the age of 59½ are subject to regular income tax and possible penalty, unless exempt.
What are some of the exemptions?
Withdrawals for eligible expenses like higher education or a first-time home purchase would be taxed at ordinary income rates with no additional penalty. For a complete list of exemptions, click here.
Should I open a different savings plan instead?
A 529 savings plan is a similar investment option – your investments grow tax-deferred, and withdrawals are exempt from federal taxes if used for qualified education expenses. A Roth IRA requires paying taxes up front on any contributions but funds are tax free when withdrawn once the accountholder reaches the eligible withdrawal age of 59½. If you’re ultimately seeking flexibility in how funds can be used and don’t necessarily need the tax benefits some of the other accounts offer, you can consider a custodial brokerage account. These accounts do not have contribution limits and can be used however the accountholder wishes once they assume control of the account.
Rachel Carden serves as the Director of Investor Education for the Securities Division of the Tennessee Department of Commerce and Insurance. She shares the importance of investing with consumers across the state via in-person presentations, speaking engagements, literature for publication, and more. To contact the Securities Division, visit tn.gov/securities.