From Yahoo Finance: 2025-06-03 18:10:00

The Trump administration’s tax bill includes $1,000 ‘Trump Accounts’ for each new baby born in the US until 2028, allowing for annual contributions up to $5,000. Advisors like Ric Edelman support the idea, but many believe the accounts will benefit upper-class families who can afford to contribute consistently.

While the proposed Trump accounts may be beneficial for upper-class families, there are other options like 529 plans and guardian Roth IRAs for children’s savings. Advisors recommend considering the tax implications of the accounts, as earnings on qualified withdrawals will be taxed at long-term capital gains rates.

Financial advisors have mixed opinions on the proposed $1,000 Trump Accounts for newborns, with some calling them “stupid” and others seeing them as an attractive tool for upper-middle-class and affluent families. The accounts are reminiscent of previous ‘Baby Bonds’ proposals and may benefit families with enough disposable income to consistently contribute.

Read more: Advisors Say $1,000 ‘Trump Accounts’ Won’t Benefit Families Who Need Help Most