25+ companies funding Trump Accounts with 'free' cash
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25+ companies funding Trump Accounts with 'free' cash
Yahia Barakah and Anna Serio-AliJanuary 30, 2026 at 4:50 AM
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25+ companies funding Trump Accounts with 'free' cash (EyeEm Mobile GmbH via Getty Images)
There's a new form you can attach to your 2025 tax return this year that you may not know about. Form 4547 lets you open a Trump Account for your child, a new tax-deferred savings account that the One Big Beautiful Bill Act created. You can file the form with your return now, or wait until July 2026 when an online portal launches at trumpaccounts.gov.
Kids born between 2025 and 2028 that meet the qualifying criteria can receive a $1,000 seed deposit from the government. On top of that, dozens of major companies are matching that $1,000 for eligible employees' children. Billionaires are also pitching in: Michael and Susan Dell committed $6.25 billion to give $250 to up to 25 million kids, while Ray Dalio pledged similar amounts for Connecticut children and Brad Gerstner is covering Indiana.
Does all this free money make Trump Accounts worth it? Let's take a closer look at what Trump Accounts offer and how they stack up against the alternatives.
Trump Accounts: What they are and how they work
LendingTree's research suggests it costs parents a whopping $300,000 to raise a kid through adulthood — and that’s excluding college tuition. So it couldn’t hurt to get a leg up courtesy of the federal government.
The basic structure
Parents or legal guardians control the account until the child turns 18. To fund the account:
Annual cap for most contributions. You and other family members can chip in up to $5,000 per year combined.
Employer contributions. Your employer can add up to $2,500 per year, but that counts toward the $5,000 limit.
Seed and certain "qualified" deposits. The government's $1,000 and some outside contributions, such as Dell's $250, don't count against the $5,000 cap.
Contribution limits adjust for inflation. These limits will increase after 2027 to keep pace with inflation.
Keep in mind that you can't start depositing money right away. The IRS says that you'll have to wait until July 4, 2026, to start contributing, even if you file Form 4547 today.
Ksenia Yudina, chartered financial analyst (CFA) and founder of Mostt, a family-focused investing platform, explains that "employers may contribute to a Trump Account of the employee up to $2,500 per year, and the contribution will not count toward the employee's taxable income, similar to 401(k)s, which is a great advantage of this type of parental savings compared to 529 plans."
Who qualifies for the one-time $1,000 seed money
Yudina states that "all children under 18 are eligible to open Trump Accounts. They need to have a valid Social Security Number and a custodian, like a parent or guardian, to open an account on their behalf."
However, the government's $1,000 pilot program contribution has specific eligibility requirements:
The child must be born between January 1, 2025, and December 31, 2028
The child must be a U.S. citizen
The child must have a valid Social Security number
A parent or guardian must make an election on the child's behalf via Form 4547 or online at trumpaccounts.gov to receive the one-time $1,000. This government contribution stays locked until your child turns 18.
Treasury will deposit the $1,000 after the account is opened and verified, but not earlier than July 4, 2026. The IRS also says Treasury plans to start sending activation information in May 2026.
Children born before 2025 or after 2028 can still open Trump Accounts if they meet the account eligibility requirements. They'll have access to all the same features, including the employer contribution benefits and tax-deferred growth, they just won't receive the initial $1,000 deposit from the government.
Additional "free" money from philanthropists and private employers
Beyond the government's $1,000 seed deposit, a wave of companies and billionaires are adding their own contributions to Trump Accounts.
Philanthropic deposits
Dell's $250 deposit. The Michael and Susan Dell Foundation committed $6.25 billion to Trump accounts, including a $250 deposit for up to 25 million children ages 10 and under in ZIP codes with median incomes below $150,000 who don’t qualify for the government’s $1,000.
Ray Dalio's Connecticut contribution. The billionaire hedge fund manager pledged $250 to accounts of 300,000 children under 10 in Connecticut ZIP codes where median income is under $150,000.
Brad Gerstner's Indiana contribution. The Altimeter Capital CEO will donate $250 to each child under five with a Trump Account in Indiana.
Nicki Minaj's fan contribution. The rapper pledged hundreds of thousands of dollars to Trump Accounts for her fans' newborns, though eligibility details remain unclear.
Employer matches
Dozens of major companies announced they'll match the government's one-time contribution for eligible employees' children. If your employer is on that list, there's an even stronger case for opening the account and claiming the money.
Companies that plan to match the government's seed money
• Bank of America
• Bank of New York Mellon
• BlackRock
• Block Inc.
• BNY
• Charles Schwab
• Charter Communications
• Chime
• Chipotle
• Coinbase
• Comcast
• Continental Resources
• Dell
• IBM
• Intel
• Investment Company Institute
• JPMorgan Chase
• Mastercard
• Nvidia
• Robinhood
• Russell Investments
• SoFi
• State Street
• Steak ’n Shake
• Uber
• Visa
• Wells Fargo
How can you (and your child) invest and use these funds?
You won't get to pick individual stocks. Funds in Trump Accounts will be invested in a diversified portfolio of low-cost mutual funds or ETFs that track the S&P 500 or another equity index, according to Yudina. "These investments are designed to maximize long-term growth while minimizing risk."
The White House also says the law limits these accounts to broad U.S. equity index funds, bans leverage, and caps fees at 0.10%.
"Unlike traditional 529s, funds can be used for education, a first home purchase or starting a business," Yudina says. "Withdrawals for eligible expenses like college or a first home would be taxed at ordinary income rates with no additional penalty."
What happens when your child turns 18
This is where things get tricky. Once your child turns 18, the account becomes a traditional IRA with all the usual rules. Withdrawals get taxed at ordinary income rates, with a 10% penalty before age 59 1/2 unless they meet traditional IRA exceptions.
"When the children turn 18, the accounts transfer to their control. They will have full access to manage and use the funds for their future goals," Yudina explains. That sounds fine until you think about what an 18-year-old might do with a pile of money.
"If children are not financially savvy, they can perceive this money as 'available for spending' rather than a 'long-term asset,' and ineligible withdrawals will lead to penalties," she warns. "It's important to educate children about the importance of long-term investments and instill financial literacy early on so they fully understand the power of compounding and eligible uses of Trump Accounts."
🔍 Learn more: 9 practical ways to save for college (even if you’re starting late)
3 alternatives parents might want to consider instead
Trump Accounts make sense if your child qualifies for the $1,000 government seed deposit, Dell's $250 or an employer match. But for larger, ongoing savings, other account types give you higher contribution limits, more flexible investment options and better tax benefits.
1. 529 plans
These tax-advantaged accounts remain the most popular choice for college savings, with more than 17 million families using them to save for college. Unlike Trump Accounts, you don't pay taxes on earnings or withdrawals when you use the funds for qualified higher education expenses.
You can contribute as much as you want each year. There's no IRS limit, though most states cap total account balances around the cost of a four-year college degree. You can even use up to $20,000 in 2026 for private school tuition before college without triggering taxes. If there’s any money left after your child finishes school, you can often roll those funds into a Roth IRA.
However, Yudina notes that "529 plans can only be used for educational expenses, while Trump Accounts can be used for the first home purchase or starting a business." If you use 529 funds for non-qualified expenses, you’ll pay a 10% penalty and income tax on those earnings.
Learn more: New 529 twist turns unused college savings into a retirement head start
2. Coverdell education savings account
Coverdell education savings accounts (CESAs) are custodial accounts or trusts you create on behalf of a child. Like a 529 account, you won’t pay taxes on earnings or withdrawals as long as you use the funds for qualified educational expenses at any age.
The main downside of CESAs is an annual contribution cap of $2,000 per child — regardless of how many people chip in. Contributors are also subject to income limits that can reduce or exclude what high earners can contribute. And you must spend the balance before the beneficiary turns 30 to avoid a 10% penalty and taxes.
3. Custodial accounts
If you’re not sure what your child’s future holds but you want to set aside something, a custodial account may be the way to go. The most common types are Uniform Gift to Minors Act (UGMA) and Uniform Transfers to Minors Act (UTMA) accounts, available through your state.
These work like trusts without the expense, legal fees or complicated paperwork. You get a lot more freedom in what you can include: stocks, bonds, certificates of deposits and even real estate in the case of UTMA accounts. There are no contribution limits.
Your child gains control at the age of majority in your state, usually 18 or 21. They're also not as tax-advantaged as 529 accounts or CESAs. Because custodial accounts are legally owned by the child, they're subject to kiddie tax rules, which means only some earnings are tax-free or at a lower rate.
Learn more: These 7 taxes catch most people off guard (even if you file on time)
Bottom line: Are Trump Accounts worth it?
The IRS and Treasury are still building the real-world system for Trump Accounts. Contributions can't start before July 4, 2026, and the government's online election option is expected in mid-2026.
If you're eligible for the $1,000 seed money, it makes sense to claim it. Free money is hard to pass up. The same goes for extra private dollars from Dell or your employer, if you qualify.
However, don't let the seed money distract you. The annual cap is low, and the investment options are limited. For larger contributions, 529 plans typically offer better tax benefits for education savings, while Roth IRAs provide tax-free growth for retirement.
"Trump Accounts aren't conflicting with other savings strategies parents have in place. They're rather complementary to other account types, like Roth IRAs, 529s, and UTMAs," Yudina explains. "Different account types can work together to address rising costs and changing economic realities."
Editorial disclaimer: Information on this page is for educational purposes and not investment advice or a recommendation to buy any specific asset or adopt any particular investment strategy. Independently research products and strategies before making any investment decision.
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About the writers
Yahia Barakah is a personal finance writer at AOL, specializing in investing, banking and credit cards. A Certified Educator in Personal Finance (CEPF), Yahia combines his economics expertise with a genuine passion for helping readers make sense of financial decisions that shape their daily lives and future goals. He's currently pursuing a Certified Financial Planner designation. Yahia's research has been featured on Yahoo, FinanceBuzz and FX Empire, among other publications. When he's not writing about finance, you'll find him freediving and capturing underwater photography along Florida's coast and around the globe.
Anna Serio-Ali is a trusted lending expert who specializes in consumer and business financing. A former certified commercial loan officer, Anna's written and edited more than a thousand articles to help Americans strengthen their financial literacy. Her expertise and analysis on personal, student, business and car loans has been featured in Business Insider, CNBC, Nasdaq and ValueWalk, among other publications, and she earned an Expert Contributor in Finance badge from review site Best Company in 2020 for her work at Finder.
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