Trump launches national investment plan to give every newborn baby $1,000 to invest in stocks

Trump hosted a roundtable at the White House on Monday to promote a key element of the Republican sweeping domestic policy bill - a provision to provide a $1,000 investment account for every newborn in the United States.

Under a pilot program approved by the House of Representatives, the government will set up these accounts, called Trump Accounts, for all children of U.S. citizens born between January 2025 and January 2029.

The $1,000 in government contributions will be deposited into an index fund tied to the entire stock market and managed by the child's legal guardian.

Each child's account will start with $1,000, and guardians or other private entities can contribute up to an additional $5,000 per year over the child's lifetime. The funds will be invested in index funds that track the broad U.S. stock market.

Account beneficiaries can withdraw 50% of the balance starting at age 18. Starting at age 25, beneficiaries can withdraw the entire balance for eligible purposes, including small business loans and higher education, and at age 30, beneficiaries have full control over the entire balance for any purpose. This type of Trump savings account requires contributions to be made after taxes and is taxed as long-term capital gains or ordinary federal income when withdrawals are made, which is different from the tax-free qualified withdrawals of 529 higher education savings accounts and Roth individual retirement accounts.

White House press secretary Karoline Leavitt said: "The passage of the Big Beautiful Act will make a real difference in the lives of working and middle-class families across America as it provides the largest tax cut in history, increases the child tax credit and creates an incredible new Trump Account program that will put young Americans on the right financial path."

At Monday's event, House Speaker Mike Johnson highlighted the economic benefits of Trump Accounts, including increasing take-home pay for ordinary families and reducing red tape for small businesses.

The event on Monday was held in the White House State Dining Room and was attended by top executives from Dell, Uber, Altimeter Capital, ARM Corp, Salesforce, ServiceNow, Robinhood and Goldman Sachs.

The CEOs are expected to pledge billions of dollars to invest in Trump Accounts for their employees' children.

Dell Technologies CEO Michael Dell attended Monday's roundtable and said: "Establishing an investment account for each child will provide a significant amount of money for their education, homeownership and the establishment of a family. Dell Technologies will proudly match dollar-for-dollar government seed investments in these accounts for all children of Dell team members."

He also said: "The bold step toward a universal ownership society contained in the Reconciliation Bill will have far-reaching benefits for the country."

The roundtable was held as the Trump administration stepped up its efforts to ensure that the Senate passed the president's domestic policy package before July 4.

NBC News first reported the event.

With 3.6 million births in 2023, according to the latest data from the National Center for Health Statistics, Trump accounts would cost taxpayers $3.6 billion at the current government-funded $1,000 starting fund.

But Trump claimed Monday that the government funding would be "absolutely no cost" to taxpayers because it would be carved out of Big Beautiful Act measures, including a 3.5% remittance tax on funds sent abroad.

Ann Reilley, CEO of Alpha Financial Advisors, told Yahoo Finance that Trump accounts "are not very attractive" to parents or other guardians, adding that "it looks like the Trump administration is complicating things for no reason."

Financial experts are skeptical that the program is the best place for parents to stash money beyond the $1,000 freebie for their children because the program's tax benefits are relatively limited.