Trump Accounts for Kids Now Invest in Stock Market

Trump Accounts, the new custodial retirement savings program for children, officially opened on the Fourth of July. Any child under 18 with a Social Security number can have one set up, and children born between January 1, 2025 and December 31, 2028 who are U.S. citizens qualify for a $1,000 seed deposit from the Treasury Department.

In Brief

• Accounts are open to any child under 18 with a Social Security number.
• Children born between 2025 and 2028 who are citizens get $1,000 from the government automatically.
• Parents, relatives and friends can add up to $5,000 a year in after tax money.
• Employers can contribute as much as $2,500 per child if they choose to participate.
• Default holdings go into the State Street SPDR Portfolio S&P 500 ETF, ticker SPYM.

Who Can Contribute and How Much

Eligibility for the automatic $1,000 deposit is narrow: it applies only to children born within that four year window who hold citizenship and a Social Security number. Everyone else under 18 can still open an account, but without the government's head start.

Contribution limits are fairly generous once an account exists. Family members and friends can put in up to $5,000 annually in after tax dollars until the year the child turns 18. Employers willing to participate can add up to $2,500 on top of that. Corporations, nonprofits, wealthy individuals, and state or local governments are also allowed to contribute.

Big Donors Are Already Stepping In

Tech billionaire Michael Dell and his wife Susan announced in December that they intend to donate $6.25 billion toward these accounts, enough to give $250 to 25 million children. The Treasury Department said Thursday that Trump Accounts will now be able to accept donations of public stock as well, a move officials described as a way to make it easier for philanthropists to give. Any stock gifts go to the Treasury first, which then transfers the funds according to the donor's wishes, applicable law and Treasury guidance, according to officials who spoke with the Washington Post.

Where the Money Sits by Default

Money contributed at launch will automatically flow into the State Street SPDR Portfolio S&P 500 ETF (SPYM), which the Treasury called its