President Donald Trump announced a new initiative called “Trump Accounts” aimed at families with young children. The plan, revealed on Tuesday, includes a significant financial commitment from tech billionaires Michael and Susan Dell, who pledged $6.25 billion to establish an estimated 25 million additional accounts. These accounts will primarily benefit children who do not qualify for the existing federally funded accounts for newborns, which provide $1,000 for babies born after January 1, 2025.
During the announcement at the White House, Michael Dell, founder and CEO of Dell Technologies, emphasized the importance of these accounts, stating, “These deposits will reach the accounts of most children age 10 and under who were born prior to the qualifying date for the federal newborn contribution.” He noted that older children could also benefit if funds remain after initial distributions.
The timing of this announcement coincided with GivingTuesday, and the Dells expressed their belief that this contribution represents one of the largest single private commitments made to support U.S. children. The initiative will allow “Trump Accounts” to be set up for American children under the age of 18, with an initial government deposit of $1,000 for children born between December 31, 2024, and January 1, 2029. Parents will also have the option to contribute up to an additional $5,000 annually.
Funding and Future Contributions
The Dell family’s donation will provide each qualified child with an initial deposit of $250 into their respective accounts. However, this funding will not commence until July 4, 2026, coinciding with the 250th anniversary of U.S. independence.
Employers will also have the opportunity to contribute up to $2,500 annually to these accounts without affecting employees’ taxable income. Senator Ted Cruz (R-Texas), who played a pivotal role in drafting and passing legislation for the “Trump Accounts,” expressed pride in the initiative. He stated, “This program will create fundamental and transformative changes for the financial security and personal freedoms of American citizens for generations.”
In a collaborative effort, Cruz and Senator Cory Booker (D-New Jersey) recently signed a bipartisan letter addressed to Fortune 1000 CEOs, encouraging them to advocate for the accounts and actively participate in their development.
Projected Financial Impact
The Council of Economic Advisers has provided projections regarding the potential growth of these accounts. Assuming average returns from the U.S. stock market, a child born in 2026 could see their account balance reach approximately $303,800 by the age of 18, and potentially $1,091,900 by age 28, if maximum contributions are made. Conversely, if no contributions are made, the account could grow to about $5,800 by age 18 and $18,100 by age 28.
Once a child turns 18, the accounts are eligible for conversion into traditional retirement accounts, providing long-term financial security.
This initiative marks a significant policy development aimed at supporting American families, highlighting the importance of early financial planning and investment in the future of children across the nation.
