'Trump Account' newborns could have $1.9M by 28, Treasury Dept. says. Here's what's required to get that much

Core Insights - The Dell family, led by Michael Dell, has pledged to contribute an additional $6.5 billion to "Trump accounts" for children, specifically targeting those aged 10 and under who were born before 2025 [3] - The "Trump account" initiative allows for a one-time government deposit of $1,000 at birth, with parents able to contribute up to $5,000 annually, while employers can add up to $2,500 [6][7] - The Treasury Department estimates that these accounts could grow to $1.9 million over 28 years, assuming maximum contributions are made [5][19] Investment Structure - The "Trump account" is designed to provide a tax-advantaged investment option for children, with the potential for significant growth through compound interest [19] - Contributions from parents are not tax-deductible, but employer contributions are tax-free [7] - The accounts are intended to encourage long-term savings for children's futures, with funds accessible at age 18 [19] Financial Context - The average annual cost of raising a child is reported to be $29,419, reflecting a 35.7% increase from previous surveys [8] - Financial experts suggest that while the "Trump account" offers a government seed fund, other options like Roth IRAs and 529 accounts may provide better long-term benefits [21][22][23] - The initiative aims to fill a gap for children born before the end of 2024, as the government will provide the initial investment for those born after [4]