The One Big Beautiful Bill signed into law on July 4 created Trump accounts for children, offering a $1,000 deposit from the government at birth. The Treasury Department claims these accounts could grow to $1.9 million over 28 years with additional contributions from parents and relatives. Michael and Susan Dell pledged $6.5 billion to help children ineligible for the seed money.

Parents can open Trump accounts for children born after Dec. 31, 2024. Employers can contribute up to $2,500 annually, with parents allowed to add up to $5,000. Parents may find it challenging to invest an additional $5,000 annually due to rising childcare costs averaging $29,419 per year.

Starting an emergency fund is essential for unforeseen expenses. Options like Wealthfront Cash and SoFi high-yield accounts offer high interest rates and no fees for easy access to funds. Acorns rounds up spare change for investments, potentially growing to over $55,000 in 18 years with weekly contributions.

The tax-advantaged Trump accounts allow tax-free growth until withdrawals are made at age 18. Contributions can reach between $3,000 and $13,800 over 18 years. However, financial experts suggest Roth IRAs, 529 accounts, or UTMA accounts may offer better tax benefits and flexibility.

While the Trump account provides some benefits, Roth IRAs, 529 accounts, and UTMA accounts may offer more advantages. Most parents are not maxing out these alternative accounts, making it unlikely they will contribute the full $5,000 annually to Trump accounts. Still, the $1,000 initial deposit remains a valuable opportunity for parents.

Read more at Yahoo Finance: ‘Trump Account’ newborns could have $1.9M by 28, Treasury Dept. says. Here’s what’s required to get that much