By Kayla Whitaker, CFP®, Paraplanner and Client Service Associate
Established under the One Big Beautiful Bill Act, Trump Accounts are a new savings vehicle designed to help families invest in their children’s futures. These federally administered, tax-deferred accounts aim to build next-generation wealth while introducing the benefits of investing from an early age.
Here’s what you need to know.
What is a Trump Account?
A Trump Account is a federally created, tax-deferred investment account for children that allows families and others to contribute to a child’s long-term financial future. Eligible children born between January 1, 2025, and December 31, 2028, may receive a one-time $1,000 federal contribution.
Who is Eligible for a Trump Account?
One of the program’s most notable features is a one-time $1,000 federal contribution for eligible U.S. citizens born between January 1, 2025, and December 31, 2028.
How Much Can Be Contributed Each Year?
Anyone can contribute to a child’s Trump Account, including parents, grandparents, and friends. As of July 2026, current guidance permits annual contributions of up to $5,000 per child.
Important Tax Note: Contributions to Trump Accounts are currently not tax deductible.
How Are Trump Accounts Invested?
Assets are limited strictly to low-cost stock index funds.
When Can Money Be Withdrawn From a Trump Account?
- Funds generally cannot be withdrawn before age 18.
- At age 18, the account converts to a traditional IRA.
- Future withdrawals are subject to IRA tax rules and potential penalties if taken before age 59½.
Is a Trump Account Right for Your Family?
While Trump Accounts may offer meaningful benefits for some households, they are only one of several available savings strategies for your child. Other options, such as 529 plans and custodial accounts, may be more suitable for your family’s needs and should be considered. Evaluating these choices in the context of your family’s goals, tax situation, and overall financial plan is essential.
Trump Accounts vs Other Savings Options
| Feature | Trump Account | 529 Plan | Custodial Account |
|---|---|---|---|
| Primary Goal | Long-term wealth building | Education savings | Flexible gifting |
| Federal Contribution | Possible $1,000 seed funding | No | No |
| Tax Treatment | Tax-deferred | Tax advantages for qualified education expenses | Varies |
| Investment Flexibility | Limited index funds | Broad investment options | Broad investment options |
Have Questions?
If you’d like to learn more about how Trump Accounts may fit into your family’s financial plan or if you’d like to compare them with other investment strategies, please contact your Senior Wealth Manager at MONTAG Wealth Management. They can help evaluate your options, answer your questions, and develop a personalized approach that aligns with your long-term financial goals.
Sources:
Internal Revenue Service, “Trump Accounts,” last reviewed or updated July 7, 2026; https://www.irs.gov/trumpaccounts
Investor.gov, “Trump Accounts.” ; https://www.investor.gov/introduction-investing/investing-basics/investment-accounts/tax-advantaged-accounts/trump-accounts
The information provided is for illustration purposes only. It is not, and should not be regarded as “investment advice” or as a “recommendation” regarding a course of action to be taken. These analyses have been produced using data provided by third parties and/or public sources. While the information is believed to be reliable, its accuracy cannot be guaranteed. MONTAG employees do not provide legal or tax advice. For specific legal or tax matters, you should consult with your own legal and/or tax advisors.
Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER® certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.