Philanthropists and corporations have also vowed to sweeten the pot for Trump accounts. The hedge fund manager Ray Dalio pledged $75 million to pad Trump accounts for certain children in Connecticut, and Michael Dell, the chief executive of Dell Technologies, gifted $6.25 billion to children under 11 who live in lower-income ZIP codes. A growing list of companies including Goldman Sachs, Comcast, Intel, Morgan Stanley and others have promised to match the government’s deposit of $1,000 for children of their employees.
There are strings attached, of course. All Trump accounts must be invested in low-cost mutual funds or exchange-traded funds that track broad U.S. equity indexes, such as the S&P 500, and there’s a $5,000 annual cap on contributions.
Recipients will need to activate their accounts through Robinhood, an e-trading platform that has partnered with the U.S. Treasury and Bank of New York Mellon to kick off the program, although they will be permitted to move their accounts to another qualified brokerage. And, as is the case with a traditional I.R.A., beneficiaries cannot withdraw money before the age of 59½ without a considerable tax penalty (although there are some qualified exceptions, like educational expenses). So even when a child turns 18 and gains access to their funds, they won’t be able to touch the money without serious tax consequences.
A head start, but just one path
No parent wants to turn down free money for their children. But there are other ways to invest for them, too — and Trump accounts may not be your best option, Ms. Baska said. She is opening a Trump account for her younger son, who was born in 2025 and qualifies for the $1,000 deposit. She doesn’t plan to contribute to it further right now, though, and she’s not opening one for her older son, who is 3 and therefore ineligible for the seed funding. Instead, she’s going to focus on contributing to their 529 plans, which provide tax-advantaged savings for education.
“The reason I’m prioritizing my kids’ 529s is that the most expensive thing that many children have to contend with as young adults is a college degree,” she said. Her parents invested in her 529 account when she was young, enabling her to graduate from college without any student loans. “I am extremely passionate about paying for my own children’s education because I saw how impactful it was to start my career at 22 with a blank slate. It was a huge financial leg up.”
