Treasury Secretary Scott Bessent has laid out the investment strategy for Trump Accounts, the government’s new tax-deferred savings program for American newborns. The money goes into low-cost index funds tracking broad US equity indices, with the explicit goal of getting the next generation invested in what Bessent calls “the American Dream.”
How Trump Accounts actually work
Every US child born between January 1, 2025, and December 31, 2028, qualifies for a $1,000 contribution from the Treasury, deposited into a dedicated investment account. That seed money gets invested immediately into low-cost US equity index funds or ETFs, such as those tracking the S&P 500.
Parents, grandparents, employers, and even philanthropists can add to the pot. Annual contributions from outside sources are capped at $5,000, with inflation adjustments kicking in after 2027.
The fee structure is notably aggressive. Management fees are capped at roughly 0.1% annually during the growth period, which runs until the accountholder turns 18.
