Billionaires Michael and Susan Dell pledged $6.25 billion to boost the new “Trump accounts,” a government-backed savings program for children. The accounts receive $1,000 for newborns and $250 for eligible children, aiming to provide long-term financial security. However, critics question if it will alleviate immediate financial strains for families.

Trump accounts are tax-advantaged investment vehicles for children, receiving a one-time $1,000 federal contribution for babies born between 2025 and 2028. Additional contributions are allowed, with funds being invested until adulthood for education, housing, or starting a business. Parents can’t access the money until their child turns 18.

Parents grapple with rising child-rearing costs in the U.S., including housing, food, childcare, healthcare, and education. The $1,000 or $250 allowances offered by Trump accounts won’t significantly ease the financial burden. Many Americans delay parenthood due to economic challenges, leading to historic low fertility rates.

While Trump accounts may not solve immediate financial challenges, they can play a symbolic role in signaling that children are a societal priority. The accounts could grow substantially if market-based investments are wisely managed over time, potentially providing meaningful returns by the time a child reaches adulthood.

Managing the real costs of raising children today requires discipline, budgeting, and utilizing tax breaks like the increased $2,200 child tax credit. Families should view Trump accounts as part of a larger financial plan, including 529 college savings, high-yield savings accounts, brokerage investments, or employer-sponsored tax benefits.

Read more at Yahoo Finance: Michael and Susan Dell donated $6.25B to expand ‘Trump accounts’ for kids. Will this help move the needle?