"Starting July 5 of this year, parents of eligible children will be able to contribute up to $5,000 a year to their child's account. To qualify, children must be under 18, be U.S. citizens, and have a Social Security number. Additionally, the Treasury will contribute a one-time $1,000 payment to babies born between Jan. 1 2025 and Dec. 31, 2028 to kick off the program."
"The Council of Economic Advisers (CEA)-an Executive Branch agency led by President Trump's appointees Pierre Yared and Kim Ruhl-released an analysis last August estimating potential savings through Trump accounts. The projections, based on historical S&P 500 total returns over rolling 18‑year holding periods from 1975 to the present, range from a low annualized return of 5.4% to a high of 18.5%."
"However, an independent check via the investment calculator maintained by the U.S. Securities and Exchange Commission finds those numbers are slightly overshot. The calculation from that source sets projected returns for a 18-year account with $5,000 annual contributions between about $162,000 and $674,000."
President Trump introduced the 'Trump accounts' baby bond program during his State of the Union address, claiming an 18-year-old could accumulate $100,000 starting from nothing. Beginning July 5, parents of eligible children under 18 can contribute up to $5,000 annually to these investment accounts. The Treasury provides a one-time $1,000 contribution for babies born between January 1, 2025, and December 31, 2028. The Council of Economic Advisers projects returns between $187,000 and $730,000 based on historical S&P 500 performance. Independent SEC calculations estimate more conservative accumulations of $162,000 to $674,000 over 18 years with maximum parental contributions.
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