Trump Accounts are a new savings initiative in the One Big Beautiful Bill to help America’s children build long-term wealth. These accounts can be created for any child under the age of 18, with the program covering children born between January 1, 2025 and December 31, 2028.
Who is eligible?
Under the proposal, any American child born between January 1, 2025 and December 31, 2028 would be eligible for a Trump account if a parent or guardian chooses to open one.
Children under the age of 18 who were born before January 1, 2025 can also participate, although this group will not receive the $1,000 government deposit.
What amount can be contributed?
Parents can contribute up to $5,000 per year, with annual limits indexed to inflation.
Employers can add up to $2,500 per year.
These employer contributions do not count as taxable income, creating an additional incentive.
How the money is invested
All deposits must be invested in:
– S&P 500 index mutual funds, or
-Exchange-traded funds (ETF) tracking US stock indexes.
Funds cannot be withdrawn before the age of 18. After that, the account is converted to a traditional IRA with standard IRA withdrawal rules.
Estimated account balances
The Council of Economic Advisors (CEA) modeled future account values using historical S&P 500 returns over 18- and 28-year rolling periods.
Median return scenario for a child born in 2026:
-$303,800 at age 18 with maximum contributions
-$1,091,900 at age 28 with maximum contributions
-$5,800 at age 18 with no additional contributions
-$18,100 at age 28 with no additional contributions
Low return scenario (maximum contributions):
High return scenario (maximum contributions):
Why are balances growing so much?
The program relies on:
– regular annual contributions,
-Historical performance of the US stock market,
-Locking up funds until adulthood.
What happens after 18 years?
At the age of 18, beneficiaries cannot freely choose. Instead, the account works like a traditional IRA:
-Withdrawals before retirement may result in taxes/penalties.
-Contributions for ages 18-28 are subject to IRA contribution limits (adjusted for inflation).
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