The One Big Beautiful Bill Act introduces “Trump Accounts” for minors, with children born between 2025-2028 eligible for a $1,000 seed contribution from the federal government. Beneficiaries can withdraw funds for education, business, or a home down payment at age 18. Contributions from parents, relatives, and employers are capped at $5,000 per year.

Account managers can invest in mutual funds or ETFs with fees limited to 0.1% of the balance each year. Contributions cannot be deducted, but the basis formed by contributions is tax-free for beneficiaries upon withdrawal. Trump Accounts follow traditional IRA rules once the beneficiary turns 18, with a 10% penalty for early withdrawals.

Children can access funds penalty-free at 18 for education, business, home down payment, natural disaster recovery, or birth/adoption expenses. CEO Brian Safdari prefers Trump Accounts over 529 plans for their versatility. Withdrawals are subject to regular income tax, excluding the basis created by contributions. The $1,000 seed capital and potential employer matches make these accounts appealing.

Read more at Yahoo Finance: Here’s How Retirees Can Take Advantage of Trump’s Big Beautiful Bill To Help Their Grandchildren