House Republicans are proposing a financial head start for America’s newborns with “Trump Accounts” that would deposit $1,000 into savings for each child born between 2025 and 2028.
At a Glance
- Part of House Republicans’ “One, Big, Beautiful Bill,” these accounts are officially called “Money Account for Growth and Advancement” (MAGA)
- Eligible newborns would receive a $1,000 federal contribution starting in 2026 through a pilot program
- Parents could contribute up to $5,000 annually, with funds restricted until the child turns 18
- Accounts would be managed by trustees with investments in eligible index funds
- The proposal must still pass both the House and Senate to become law
New Financial Future for American Children
House Republicans have included a provision in their budget legislation that would create special savings accounts for newborns, branded as “Trump Accounts.” The initiative is part of the GOP’s comprehensive “One, Big, Beautiful Bill” and would provide a $1,000 deposit from the federal government for each eligible child. These accounts, formally designated as “Money Account for Growth and Advancement” (MAGA), aim to establish financial foundations for America’s youngest citizens while encouraging responsible savings habits from birth.
The accounts would be created for children born between 2025 and 2028 as part of a pilot program, with the IRS automatically establishing accounts for eligible children unless parents choose to opt out. This innovative approach to building generational wealth would allow families across economic backgrounds to begin saving for their children’s futures with government support. The program could potentially transform how Americans approach financial planning for their children.
Here is a detailed report on what the One Big Beautiful Bill Act entails for Americans: https://t.co/2jsNQjop1u
— Gurt (@Azeri_Mamedov) May 22, 2025
How Trump Accounts Would Work
The proposed MAGA accounts would function as trust accounts specifically for minor children under eight years old. Starting in 2026, parents and guardians could contribute up to $5,000 annually to these accounts, with adjustments for cost-of-living increases over time. A designated trustee would manage each account, with investment options limited to eligible index funds to ensure appropriate growth while minimizing risk. This structure provides both safety and potential growth for children’s savings.
“Money Account for Growth and Advancement”, said House Republicans.
Access to funds would be restricted until the child reaches age 18, with certain limitations continuing until age 25. This ensures the money remains intact during formative years. Contributions would be tax-free, and investment earnings could receive favorable tax treatment if withdrawn for qualified purposes. Once the beneficiary turns 31, the account would terminate, potentially with tax implications for any remaining earnings. These restrictions are designed to encourage long-term saving rather than short-term spending.
Legislative Process and Implementation
While the House has passed their budget bill containing the Trump Accounts provision, the proposal must still clear significant legislative hurdles before becoming law. The bill requires Senate approval and the President’s signature to take effect. Implementation details remain to be finalized, including exactly how the IRS would administer the program and what specific index funds would be eligible for investment. These operational aspects will be crucial to the program’s success.
Financial experts suggest these accounts could have significant long-term benefits for participants. A $1,000 investment at birth, even without additional contributions, could grow substantially over 18 years through compound interest. With the additional family contributions allowed, children could potentially enter adulthood with meaningful savings to support education, housing, or other important financial needs. The program represents a concrete step toward addressing long-term financial security for future generations of Americans.
