'Trump Accounts' to give every newborn in America $1K starting July 4

WASHINGTON, DC: Every newborn in the country is set to get a financial head start, thanks to President Donald Trump and his administration for passing a law to support their future.

The plan, called “Trump Accounts,” gives every child $1,000 at birth. When they turn 18, they’ll have a financial boost, no matter their family’s income. It’s part of Trump’s tax legislation, which will take effect on July 4, 2026.

Point to note that this funding targets children in ZIP codes where the family income is $150,000 or less, and who aren’t eligible for the $1,000 Treasury bonus.

Trump joined Michael and Susan Dell and lawmakers to celebrate their $6.25 billion donation to 'Trump Accounts.'

Children to receive $1,000 at birth through Trump Accounts

A law passed earlier this year gives $1,000 to every newborn whose parents set up a “Trump Account.” The funds are managed by private firms and invested in the stock market, and children can access the money when they turn 18, as per the White House government site.

Parents can open accounts for older children, but the $1,000 bonus is only for babies born during Trump’s administration. In addition, billionaires Michael and Susan Dell announced a donation that could give children 10 and under $250 if their parents open an account. 

What is a Trump Account?

For those who are unaware, the “Trump Account” is a new savings program where money is invested in the stock market on behalf of a child. Children cannot access the funds until they turn 18, and the money can only be used for certain purposes, such as paying for college, starting a business, or buying a first home.

When a parent opens an account, the US Treasury will add $1,000 for newborns. Private banks and brokerages manage the investments, which must be placed in US stock market index funds and cannot charge more than 0.10 per cent in annual fees.

Parents can contribute up to $2,500 per year from pretax income, similar to retirement accounts. Additional contributions can come from employers, relatives, friends, local governments, or charitable organizations. Annual contributions are capped at $5,000 per account, but funds from governments and charities do not count toward that limit.

Trump Account rules for newborns and children under 18

To get the $1,000 seed money, a child needs to be a US citizen, have a Social Security number, and be born between January 1, 2025, and December 31, 2028. Any parent can set up the account, no matter their immigration status.

The money cannot be accessed until the child turns 18, except in rare cases, and withdrawals will be subject to taxes. It is not intended for immediate expenses.

Children born before 2025 are not eligible for the $1,000 bonus, but parents can still open accounts for them if they are under 18. Parents can contribute up to $2,500 in pretax income for these children. 

'Trump Accounts' won’t accept contributions until July 2026, but parents of eligible children can start the process now. To do so, they need to fill out IRS Form 4547.  Parents who sign up in May will receive instructions on how to complete the account setup.