OPINION:
Anyone born in the new year could be set up for financial success. Treasury Secretary Scott Bessent has been meeting with lawmakers to go over the scheme created in the One Big Beautiful Bill to harness the power of compound interest for America’s youngest generation. It all starts with a small seed contribution from Uncle Sam.
“A single $1,000 deposit into a Trump Account at birth will grow to over $600,000 by the age of retirement. President Trump is putting the American Dream within reach of every citizen, no matter the circumstances of birth,” Mr. Bessent wrote on X.
To take advantage of the benefit, parents need to go to TrumpAccounts.gov to fill out IRS Form 4547, which will establish a savings fund akin to an Individual Retirement Account for their child.
Unlike a traditional IRA, however, the cash can be withdrawn at age 18 to buy a home or pay for college. Alternatively, it can be left alone until 67 to create a healthy nest egg for retirement. Assuming the S&P 500 advances as it has done over the past 100 years, that $1,000 initial amount might balloon to $14 million with a modest $5,000 added every year.
That’s something that can happen as family members, employers or random strangers can chip extra money into the fund. The trend for doing so began with computer entrepreneur Michael Dell injecting $6.2 billion into the program, equal to $250 for the first 25 million babies in low- and middle-income communities.
Likewise, hedge fund guru Michael Dalio is making a $250 grant for each baby born in Connecticut. Billionaires appreciate this sort of benevolence because it lacks overhead. If they give to a non-profit, middlemen end up siphoning from their generosity, but that’s not true here.
Each account can receive up to $5,000 in additional contributions annually, beginning July 4, 2026. The plan should provide substantial returns for individuals in their golden years using funds invested in broad U.S. market index funds that have a proven track record of strong long-term yields.
Supportive politicians insist this isn’t a replacement for Social Security, but the pilot project will surely outshine Franklin Roosevelt’s classic Ponzi scheme in every respect. Trump Accounts are what the social safety net should have been from the beginning. With a relatively low up-front cost, this system gives moms, dads and then 18-year-olds control over the money.
Boldness is in Mr. Trump’s DNA, and this initiative will almost certainly shake up the way the upcoming generations think about saving for tomorrow. Plutocrats will one-up each other virtue signaling with their wealth by boosting accounts belonging to people they’ve never met.
It’s not the only or necessarily best form of charity. It would probably be even more powerful to put the same dollar figures toward school choice scholarships to help needy families pull their kids out of a failing public school and give them a shot at the private education formerly only available to the rich, but it’s still a great option that can be used without penalty for higher education.
As far as government projects go, this one is hard to fault. Hopefully, Mr. Bessent will exert pressure on the IRS to ensure the paperwork and instructions are radically streamlined to guarantee as many young people as possible get hooked on fiscal responsibility by seeing their net worth increase on the way to their 18th birthday.
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