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  "description": "What’s the deal with Trump Accounts?",
  "path": "/what-to-know-about-trump-accounts/",
  "publishedAt": "2026-02-13T15:31:02.000Z",
  "site": "https://www.thepurse.co",
  "tags": [
    "_Babylist_",
    "_family and money_",
    "so much funding to ICE",
    "_Nicki Minaj announced_",
    "Yahoo Finance",
    "_“make your baby a millionaire”_",
    "_Ron_",
    "_gorgeous landing page_",
    "_“baby bonds”_",
    "_proposed federal baby bond legislation_",
    "_Invest America Act_",
    "_“The America We Need”_",
    "_Ezra Klein interviewed_",
    "_Connecticut Baby Bonds Trust_",
    "_study by the Economic Policy Institute_",
    "_this recent Home Ec_",
    "_Friend of The Purse Matt Schulz_",
    "_Priya Parker’s interview_",
    "_this newsletter_",
    "_TikTok_",
    "spending on date nights",
    "_Mercury_",
    "_The New Economics of Modern Love_",
    "which is how it works at my house",
    "_setting up a GoFundMe_",
    "_why pockets are so rare in women’s clothing_",
    "_90% of Icelandic women went on strike_",
    "_Subscribe today_",
    "Who are you shopping for",
    "Greenlight",
    "__Home Economics No. 46: A family in the Chicago suburbs earning $475k with $110k in debt__",
    "How to roll over your workplace retirement account“Think of it as Marie Kondo-ing your finances: Does this spark joy? If not, roll it over.”The PurseAlicia Adamczyk",
    "How a family of 5 in Chicago lives on $475k a yearA wealth strategist and a stay-at-home mom share how much they spend on housing, food, clothing, and more for their family of 5.The PurseLindsey Stanberry",
    "Who should pay for the first date?Love and money can be complicated from the very first date and the question of who should pick up the check. Six married women weigh in.The PurseLindsey Stanberry",
    "How much are you spending on Valentine’s Day?Do you go all in or do you sit this holiday out?The PurseLindsey Stanberry",
    "WFUV dance party"
  ],
  "textContent": "During the Super Bowl last Sunday, following Charlie Puth’s rather jazzy rendition of the national anthem, there was an ad for Trump Accounts, the new tax-advantaged investment accounts for children that are launching this summer\n\nI wouldn’t be surprised if you missed it. The 30-second ad, paid for by Invest America, was fairly subtle, with almost no Trump Account branding. It was also a pretty vague ad. A bunch of cute kids talked about investing and the American Dream and trampolines. Our president’s name was not mentioned once.\n\nBut these accounts have been on my radar for a while, and not just because I write regularly about topics related to personal finance. This year, The Purse is partnering with _Babylist_ to help them expand their coverage of all things _family and money_. And what better timing than right now, when their core audience (families with a baby on the way) will be the ones who potentially benefit the most from Trump Accounts?\n\nI’m getting ahead of myself, though. Three paragraphs in, and I’ve barely even explained what a Trump Account is. First off, can we call it a 530A account going forward? That’s what they are called in the tax code. I’ll likely lose the Google-search-traffic battle, but it’s definitely a more palatable phrase for me and this mostly left-leaning audience.\n\nOK, so what do you need to know about 530A accounts? To start, they were created under the One Big Beautiful Bill Act. (Yes, the same bill that allotted so much funding to ICE.) They work a lot like individual retirement accounts (IRAs) and sort of like 529s. There are limits on how much you can contribute (up to $5,000 per child per family) and when your child can withdraw the money (not until they’re 18, and then only for certain expenses, like paying for college or buying a house). The money will be invested in low-cost index funds, so like any money you have that’s invested in the stock market, there’s some risk involved.\n\nWhile anyone with a child under the age of 18 can open an account for their kid(s), not everyone will qualify for seed funding. As part of OBBBA, babies born between 2025 and 2028 will receive $1,000 from the federal government when they open an account. And last December, tech billionaire Michael Dell and his wife, Susan, announced they were donating $6.25 billion to fund 530A accounts for an additional 25 million U.S. children who live in low-income areas. The Trump Administration is trying to encourage billionaires in every state to make similar donations. So far, they’ve got backers in Connecticut and Indiana, but there’s very little info about how one might figure out if their kid qualifies for this money.\n\nThe other intriguing feature of a 530A account is that employers can match employee contributions, much like they match a 401(k). A business can contribute up to $2,500 per employee, and that $2,500 counts toward the $5,000 annual limit. More and more companies have been stepping forward to announce that they’ll be offering this perk for their employees, including Acorns, Comcast, and IBM. And _Nicki Minaj announced_ that she would be funding some accounts for her fans’ kids. (Yes, random, I know.)\n\nYou might be wondering, what’s the point of these accounts? And that’s a fair question. If you already have a 529 account, why would you also open one of these? Can you even trust that it’s a legit account? Will it disappear after this administration leaves office?\n\nYou might also feel like $1,000 in an account that your kid can’t access until they’re 18 feels like a joke when you consider that child care costs as much as a mortgage in all 50 states, and that we live in a country without federally mandated paid family leave. These are also totally legit responses.\n\nI have so many different feelings about these accounts, and like most things money related, I don’t think they are fundamentally _good_ or _bad_ , but simply another financial tool to consider. As I told Yahoo Finance last week on behalf of Babylist, I would first recommend you run through a checklist of all your other financial responsibilities. Can you afford your day-to-day expenses? Are you paying off high-interest debt? Do you have emergency savings? Are you saving for your own retirement? What other short- or long-term financial goals are you trying to achieve? Does your child qualify for the seed funding? Is your employer going to match your contributions?\n\nMost Americans are struggling to save for their own retirement—it’s hard to imagine they have enough money to save for their kids’ futures. And yet, a piece of me _loves_ the _“make your baby a millionaire”_ narrative I see on Instagram. Compound interest is a marvel, and if you can afford to start investing when you’re young, your money has more time to grow.\n\nThe Trump Accounts website is pretty aggressive with its investment calculations, imagining a world where the stock market continues to grow at historical rates. Any financial expert worth her salt will warn you that past performance does not guarantee future results. The contributions you invest in a 530A account could grow, but you might also lose money when the stock market is down. Still, there’s also a chance that you stick some money in that account and it will grow and grow and grow, and by the time your child reaches 18, they’ll have a nice little nest egg to roll over into an IRA, which can then grow and grow and grow until they reach retirement age.\n\nSo am I going to open one for Freddy? I’m not sure yet. We already have a 529 and a small brokerage account that we opened some years ago that’s earmarked for him. But if I did qualify for seed money and/or an employer match, I would definitely look into it more.\n\nNote that the Super Bowl ad was misleading: Every U.S. child doesn’t _automatically_ get one of these accounts. (Thank you, _Ron_, for bringing this error to my attention). You have to sign up by filling out a Form 4547 when you file your taxes, or by entering your info on the Trump Accounts website. (Which, TBH, didn’t feel very secure!)\n\nThere’s still a lot we don’t know about Trump accounts, which makes it hard for any financial expert to recommend them. We don’t know which financial institutions will be holding the accounts, how to make contributions, which investment options you can pick, if there are any fees, how to take a disbursement, and so on. Over at Babylist, they set up a _gorgeous landing page_ filled with a ton of additional info, and we’ll be updating as we learn more.\n\nI’m curious to hear your thoughts and questions. Will you open one for your kid?\n\n-_Lindsey_\n\n## **530A accounts in the news**\n\n  * Economists Darrick Hamilton and William Darity Jr. first proposed the concept of _“baby bonds”_ back in 2010 as a way to close the racial wealth gap in the U.S. Their original idea was that every child born into poverty would receive a federally funded trust account at birth.\n  * Senator Cory Booker (D-N.J.) and Congresswoman Ayana Pressley (D-MA) first _proposed federal baby bond legislation_ in 2019, and then again in 2021 and 2023. In 2025, Ted Cruz (R-TX) introduced the _Invest America Act_ to establish these tax-advantaged investment accounts for kids. They were ultimately rebranded as Trump Accounts and folded into the One Big Beautiful Bill Act.\n  * I first learned about Hamilton and Darity’s work in _“The America We Need”_ series, which _The New York Times_ editorial board ran in July 2020, laying out “a wide range of ideas for reforging our economy, our society and our democracy.” Remember when we thought we might be able to radically (and positively) reshape our world post-pandemic?\n  * _Ezra Klein interviewed_ Darrik Hamilton about this idea in 2023.\n  * Connecticut was the first state to pass baby bond legislation in 2021, and the _Connecticut Baby Bonds Trust_ rolled out in 2023. Children who are born to families covered by HUSKY Health, Connecticut’s Medicaid program, after 2023 qualify to receive an investment account with an initial $3,200 deposit.\n  * Unfortunately, the way that 530A accounts are set up, with the onus of contributing to the accounts falling on families, philanthropists, and private employers, it’s more likely to exacerbate the racial wealth gap, according to a _study by the Economic Policy Institute_.\n\n\n\n## **What else we’re talking about**\n\n  * Inspired by _this recent Home Ec_ and _Friend of The Purse Matt Schulz_, my husband and I attempted to negotiate our lease renewal, which we just received. We didn’t really have good justification, except that a $150-a-month increase in rent seemed kind of high given we’re not exactly living in a high-demand area. Our landlord sent back a long email detailing why he was raising it so much and then offered to knock off $10 per month. So…kind of a win? -_Alicia_\n  * I can’t stop thinking about _Priya Parker’s interview_ on Ezra Klein’s podcast. (Thanks for sending, Mom!) Creating community takes a lot of work, and it’s so easy to fall into a habit of just waiting around hoping someone will invite you to do something cool. Even though I’m tired after a long week, I threw out a last-minute invite to my friend Issy, and she and her son are coming over to bake cookies with me and Freddy this afternoon. Trying, as always, to create the world I want to live in! -_Lindsey_\n  * I enjoyed _this newsletter_ and _TikTok_ by Ilana Wiles about the juxtaposition between Bad Bunny’s incredible Super Bowl halftime performance and the dystopian ads that were playing each break. She put into words something I felt but hadn’t articulated. _-Alicia_\n  * It was so much fun hearing from Purse readers about how much they’re spending on date nights! -_Lindsey_\n  * This week, _Mercury_ launched a huge survey— _The New Economics of Modern Love_—all about couples and money. There were so many interesting stats, and overall, I was excited to see people felt pretty good about things, with 73% saying they felt confident managing money with their partner. The folks at Mercury asked one fun question that really stood out. If you and your partner were to swap responsibilities, would they know the passwords to the financial accounts? More women than men said their partners wouldn’t know the passwords, which is how it works at my house. I’m curious if any of you readers have had a similar experience? #partner\n\n\n\n## **On our radar**\n\n  * I have been so sad since learning that James Van Der Beek died this week at the too-young age of 48 from colorectal cancer. But it feels especially tragic that even he, a TV star, and his family had to resort to _setting up a GoFundMe_ to cover his medical expenses. Our system is so broken. If you’re 45 or older, or you have family history, schedule that colonoscopy. It sucks! But the peace of mind is priceless. -_Lindsey_\n  * Friend of The Purse The Persistent is an independent media organization that puts women at the center of the story—on topics ranging from _why pockets are so rare in women’s clothing_ to the day _90% of Icelandic women went on strike_. Join a community of 20,000 readers who get The Persistent’s newsletter for free. _Subscribe today_.\n\n\n\n## **Stat of the week**\n\n> Who are you shopping for this Valentine’s Day? According to Greenlight, while around 36% of teens are shopping for a crush, slightly more, 37%, are shopping for friends.\n\n## **Comment of the week**\n\n> I keep thinking about this post. When I had a dual income household, albeit with much less combined income, we were also in debt and did the whole ‘how did it get this way?’ head scratching monthly, with me churning through ideas at night and lots of biting words at one another. What helped me (and I absolutely cringe at this) was following Dave Ramsey’s plan. I know. That and a YNAB subscription got us out of credit card debt, paid off the HELOC, a car, student loans, and cash flowed braces and a nice vacation. Frankly, it also allowed us to get divorced years later, when you need a substantial amount of cash for down payments on rentals, home selling fees, and more.” -_Marlena on_ __Home Economics No. 46: A family in the Chicago suburbs earning $475k with $110k in debt__\n\n## **What else we wrote on The Purse this week**\n\n How to roll over your workplace retirement account“Think of it as Marie Kondo-ing your finances: Does this spark joy? If not, roll it over.”The PurseAlicia AdamczykHow a family of 5 in Chicago lives on $475k a yearA wealth strategist and a stay-at-home mom share how much they spend on housing, food, clothing, and more for their family of 5.The PurseLindsey StanberryWho should pay for the first date?Love and money can be complicated from the very first date and the question of who should pick up the check. Six married women weigh in.The PurseLindsey StanberryHow much are you spending on Valentine’s Day?Do you go all in or do you sit this holiday out?The PurseLindsey Stanberry\n\n## **Best money we spent this week**\n\n  * I got into the pre-sale for Mitski, so my friends and I will be attending her show when she’s in NYC next month! ($90 with fees 🙄) _-Alicia_\n  * Freddy is heading to my mom’s Saturday night, and Ken and I got tickets to the WFUV dance party! I am very excited! ($120, also with fees) -_Lindsey_\n\n",
  "title": "So you want to make your baby a millionaire?",
  "updatedAt": "2026-02-13T15:31:02.000Z"
}