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March/April 2026
What Are "Trump Accounts"?
Introduced in the One Big Beautiful Bill Act (OBBBA), these are government-funded investment accounts designed to help children build wealth from birth. Children born between January 1, 2025, and December 31, 2028, who are U.S. citizens and have a Social Security number, are eligible to receive a one-time $1,000 deposit from the U.S. Treasury to start the account. Children born outside these four calendar years are also eligible for an account, but they won't receive the $1,000 in government seed money.
Parents, grandparents, and other individuals can make after-tax contributions of up to a combined total of $5,000 per year to each account. Employers may also contribute up to $2,500 a year to accounts for their employees' dependents. Any employer contributions also count toward the overall $5,000 cap. The contributions grow tax-deferred until withdrawn. Account investment options are limited to mutual funds* or exchange-traded funds that track a qualified index, such as the S&P 500.
What's the education planning tie-in?
Beginning the year the child turns 18, they can make penalty-free withdrawals for qualified educational costs. The child will incur regular income tax on earnings and tax-free contributions from the government/ employers. Still, all after-tax contributions made by parents and others can be withdrawn tax-free. After age 18, the account functions similarly to a Traditional IRA, with continued tax-free growth and the ability to withdraw funds for any purpose starting at age 59-1/2.Opening an account makes sense if your child is eligible for the $1,000 seed money. It may also be worth considering if your employer is willing to contribute to your child's account. Accounts can be opened beginning July 4, 2026. More guidance from the Treasury is expected before then.
*Investors should carefully consider the investment objectives, risks, charges, and expenses of the fund before investing. Contact the issuing firm to obtain a prospectus, which should be read carefully before investing or sending money. Because mutual fund values fluctuate, redeemed shares may be worth more or less than their original value. Past performance won't guarantee future results. An investment in mutual funds may result in the loss of principal.
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Adan H. Diaz and Bryce McLeish offer products and services using the following business names: FRESCO Financial Advisers – insurance and financial services | Ameritas Investment Company, LLC (AIC), Member FINRA/SIPC – securities and investments | Ameritas Advisory Services (AAS) – investment advisory services. AIC and AAS are not affiliated with FRESCO Financial Advisers. The information you provide us is the basis for the recommendations we make to help you meet your unique financial goals and objectives. If you experience a change in your financial situation or investment objectives, or if you wish to modify or add any restrictions concerning the management of your account, please contact us. Products and services are limited to residents of states where the representative is registered. This is not an offer of securities in any jurisdiction, nor is it specifically directed to a resident of any jurisdiction. As with any security, request a prospectus from your representative. Read it carefully before you invest or send money. A representative will contact you to provide requested information. Representatives of AIC and AAS do not provide tax or legal advice. Please consult your tax advisor or attorney regarding your situation.
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