US President Donald Trump on Monday unveiled a new federal initiative that would provide every newborn American with a $1,000 government-funded investment account — a signature component of what he calls “the One Big Beautiful Bill.”
The accounts, branded as “Trump Accounts,” aim to foster long-term financial growth for the next generation and are already drawing support from some of the country’s top business leaders.
“This is a pro-family initiative that will help millions of Americans harness the strength of our economy to lift up the next generation,” Trump said at a White House event. “They’ll really be getting a big jump on life, especially if we get a little bit lucky with some of the numbers and the economy.”
BABY ACCOUNTS WITH LIMITS
The accounts would be seeded at birth with a one-time $1,000 government contribution and grow tax-deferred, tracking a broad stock index. Parents and guardians could contribute an additional $5,000 annually. The accounts will be privately held and accrue interest until the child turns 18.
The bill would require at least one parent to produce a Social Security number with work authorisations, meaning US citizen children born to some categories of immigrants would be excluded from the benefit. But unlike other baby bond programs, which generally target disadvantaged groups, this one would be available to families of all incomes.
While Trump hailed the proposal as a “pro-capitalist answer to inequality,” experts were quick to raise concerns, especially as the program comes amid proposals by Trump-aligned lawmakers to cut programs that directly support low-income families.
“The rise and fall of nations occurs when you have a wealth gap that grows, when you have people who lose faith in the system,” said Brad Gerstner, a Silicon Valley investor who helped craft the proposal. “We’re not agentless. We can do something.”
However, experts say the accounts are more symbolic than transformative. Assuming a 7% annual return, the $1,000 seed investment would grow to roughly $3,570 over 18 years — a meaningful boost, but not a game-changer for children growing up in poverty.
The program is drawing mixed reviews from social advocates. While some applaud the intent to build generational wealth, others argue that Trump Accounts won’t help families facing food insecurity, homelessness, or lack of health care today.
“Having children have health care, having their families have access to SNAP and food are what we really need the country focused on,” said Shimica Gaskins of End Child Poverty California.
With inputs from Associated Press
