Parents and guardians will soon be able to open a Trump account for their children. And many large employers are piling up opening incentives.
First, babies born between 2025 and 2028 will receive a one-time $1,000 contribution from the Treasury. There are no income requirements and all U.S. families are eligible to receive initial seed money. But in some cases, that’s only half the story.
There is a growing list of companies to help fund these savings accounts from the start, including: SoFi, charter communicationsBNY, BlackRock, Investment Company Research Institute, robin hood and charles schwabannounced that it would match $1,000 in federal contributions for the children of its employees.
While the goal is to initiate wealth-building opportunities, experts say employer matching, especially by companies in the financial services industry, may not help reduce the racial wealth gap in the United States.
“They’re high-income earners, so it’s not clear to me how much that helps them build wealth on a large scale,” said Madeline Brown, senior policy associate at the Urban Institute, a Washington-based think tank.
Other funding may also be available depending on specific criteria. Children aged 10 and under and born before January 1, 2025 (not eligible for the first $1,000 deposit from the Treasury) will receive a $250 contribution thanks to a $6.25 billion pledge made by tech CEO Michael Dell and his wife Susan.
Children in Connecticut may be eligible for additional donations from billionaire hedge fund manager Ray Dalio and his wife, Barbara. Treasury Secretary Scott Bessent said at a White House press briefing last month that philanthropists in other states could follow suit as part of the “50-state challenge.”
As it stands, these additional contributions are targeted to households living in ZIP codes with a median income of less than $150,000.
How to set up a Trump account
Trump accounts, also known as Section 530A accounts, were created as part of President Donald Trump’s “Big, Beautiful Bill” passed by Congress in July to encourage early wealth accumulation.
Opening an account requires an election on IRS Form 4547, named after President Trump’s term in office. The form also includes a checkbox for a $1,000 state contribution for children born between 2025 and 2028.
Form 4547 can be filed separately or with your 2025 tax return on January 26, which marks the official start of the 2026 tax filing season.
Later this year, this election will also be available via Trumpaccounts.gov.
Once the account is opened, a parent, guardian, grandparent, etc. can contribute up to $5,000 per year after taxes until the year before the beneficiary turns 18. Annual contribution limits adjust for inflation starting in 2027.
As part of the $5,000 limit, employers can contribute up to $2,500 per worker per year, which will not be counted as taxable income, the IRS said. This figure also adjusts for inflation from 2027 onwards.
Eligible charities and state and local governments may also make donations that do not count toward the $5,000 limit.
How much is the Trump account worth?
Experts say additional contributions to Trump’s account could make a difference over time.
For example, a family receives $2,000 in the first year of their baby’s life, including $1,000 from the Treasury and a matching contribution of $1,000 from their employer.
After 18 years, the account could be worth about $6,800, assuming a 7% annual return, said Ivory Johnson, a certified financial planner and founder of Delancey Wealth Management in Washington. He is also a member of CNBC’s Financial Advisory Council.
Many experts advise families to receive “free money” from sources such as the Treasury or their employers. But beyond that, families can also weigh other investment options, such as 529 college savings plans and taxable brokerage accounts, depending on their goals and schedule.
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