Free money from the government may sound too good to be true, but questions remain about how beneficial it really is. President Donald J. Trump has partnered with the U.S. Treasury and the Michael & Susan Dell Foundation to establish a system of financial bond accounts for eligible children, which they can access when they turn 18.
Eligibility begins for children born between 2025 and 2028, who can receive a $1,000 contribution to these accounts from the U.S. Treasury. In addition, following a $6.25 billion donation from the Michael & Susan Dell Foundation, 25 million American children ages 10 and under who live in ZIP codes with median household incomes below $150,000will receive an additional $250 deposited into their accounts.
Supporters say the initiative could give millions of low- and middle-income children a stronger chance at achieving the American dream.
“We believe the best investment we can make is in the future of our society,” Michael and Susan Dell said in a press interview. “We believe this can build hope, prosperity and opportunity for generations to come.”
The accounts will allow individuals to contribute up to $5,000 per year, with funds growing based on market returns. With the maximum annual contribution over 18 years, an account could grow to approximately $190,000 with low returns and between $300,000 and $700,000 with medium to high returns. The program is set to begin July 4, 2026, marking the United States’ 250th anniversary.
However, some financial experts advise against making large annual contributions and recommend opening an account only to claim the initial $1,000 deposit. Many instead prefer alternative savings options such as 529 plans, which are tax-advantaged accounts designed specifically for education expenses.
Adam Michel, director of tax policy studies at the Cato Institute, said parents should “not contribute their own money to Trump accounts,” citing “too many strings attached compared to a trustworthy 529 plan.”
While both plans offer financial benefits for children, experts tend to favor 529 plans because they prioritize college savings and allow unused funds to be transferred to an IRA. Trump accounts provide more flexibility in how funds can be used, while 529 plans impose penalties on withdrawals made for noneducational purposes.
The popularity and relevance of Trump accounts may increase as eligibility begins for newborns in the coming year. As the program launches and contributions become available, parents may soon face the decision of which financial plan best suits their child’s future.
