Will Trump Accounts deliver for American children?
Image: BBC News
The opening bell rang inside the Oval Office this week — not for a company, but for a savings account named after the president himself.
Trump Accounts are now open to every US child under 18, with babies born between 2025 and 2028 getting a $1,000 starter from the government. Families, friends and employers can add up to $5,000 a year, unlocked when the child turns 18.
In theory, it hands a new generation a stake in the "American dream." In practice, tax experts told the BBC the scheme is complicated — and that lower-income families could actually lose out, a sharp edge as the cost of living dominates the run-up to November's mid-terms.
By law the money must sit in a low-cost index fund, growing tax-free. But withdrawals before age 59½ face taxes and a possible 10% penalty unless spent on approved goals: college, a first home, or emergencies.
The White House has promoted the accounts hard, pitching them alongside existing vehicles like IRAs and 529 college plans. Reaction, however, has been split between those who see a genuine boost and sceptics who call it hype.
Whether Trump Accounts become a lasting legacy or a missed opportunity will hinge on take-up by the families who need them most — and on whether the promised returns outweigh the fine print.