Newborn children in the U.S. will soon have access to $1,000 in federal funding through new investment accounts, announced by President Donald Trump as “Trump accounts,” though some experts have criticized the program for failing to help financially vulnerable kids.
Some experts have criticized the accounts for failing to help more financially vulnerable children.
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Key Facts
The “Trump Account” program, a component of the One Big Beautiful Bill Act passed earlier this year, will provide a one-time federal contribution of $1,000 into a new investment account for all children born in the U.S. between Jan. 1, 2025, and Dec. 31, 2028.
The accounts will become available in 2026, though the first contribution to the account cannot be made until after July 4, 2026, according to Charles Schwab.
Newborn children will be automatically enrolled in the accounts, and parents or other account custodians can contribute up to an additional $5,000 annually in post-tax funds.
Any child in the U.S. under age 18 with a Social Security number is eligible for a Trump account, though they will not receive the initial $1,000 seed contribution.
Some contributions, including those made by an employer, a charity or the government, can be made with pre-tax funds, and any potential appreciation or earnings within the account will grow tax-free.
All funds held in these accounts will be invested in index funds tracking the broader stock market.
How Much Can Be Withdrawn From A Trump Account?
Beneficiaries can withdraw up to 50% of the account balance at age 18, though access is expanded at age 25 for qualified purposes, including small business loans and higher education. Full control is granted at age 30 for any use. Trump accounts require post-tax contributions and tax withdrawals as either long-term capital gains or normal federal income.
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