What is a Trump Account calculator?
A Trump Account calculator projects how a new federal savings account for kids (IRS Section 530A, created by the One Big Beautiful Bill Act) could grow. It checks whether your child qualifies for the one-time $1,000 government seed contribution, then models growth from your own contributions — both by the time the account unlocks at 18, and further out, since the account converts to a Traditional IRA at that point and can keep growing untouched for decades.
How to use this calculator
- Pick your child's birth year. Only children born 2025–2028 qualify for the $1,000 government seed — the calculator tells you either way.
- Enter your planned annual contribution (up to the $5,000/year federal cap) and your expected annual return.
- Choose a retirement age to see both the balance at 18 and the projected value if it's left untouched until then.
How the math works
The seed money (if eligible) and your annual contributions compound annually at your chosen rate until the child turns 18: FV = Seed × (1+r)n + PMT × [(1+r)n − 1] / r. From 18 to your chosen retirement age, that balance keeps compounding at the same rate with no further contributions modeled — a conservative estimate, since the account holder could keep contributing under Traditional IRA rules from that point on.
Example
Suppose your child is born in 2026 (eligible for the $1,000 seed), you contribute $1,200/year ($100/month), and your investments grow at 10% annually. By age 18, the account holds about $60,279. Left untouched until age 65, that grows to roughly $5,316,450 — the power of nearly 50 extra years of compounding on top of an early start.
How to open a Trump Account and claim the $1,000
- Confirm eligibility. Any child under 18 with a Social Security number can have a Trump Account. The $1,000 federal seed is the part with the catch: the child must be a U.S. citizen born between January 1, 2025 and December 31, 2028.
- File IRS Form 4547 to claim the seed. The $1,000 is not automatic — a parent or guardian has to elect it by filing Form 4547. Once it's filed, the IRS sends instructions to activate and finish setting up the account, including an identity-authentication step.
- Pick a provider and the right investment. Money must go into a low-cost, broad U.S. stock market index fund — no cash balances, no individual stock-picking. Major brokerages are offering Trump Account custody.
- Contribute after July 4, 2026. No individual or employer contributions can be made before that date. From there you can add up to $5,000 per year (the cap is inflation-indexed for tax years after 2027).
Once the account is open, come back and run the numbers above to see what your contribution schedule could be worth at 18 — and, left untouched, at retirement.
Trump Account vs. 529 plan vs. custodial Roth IRA
A Trump Account isn't a college fund and isn't a replacement for a custodial Roth IRA — each does a different job. Here's how the three line up:
| Feature | Trump Account | 529 Plan | Custodial Roth IRA |
|---|---|---|---|
| Best for | General long-term savings for a child | Education costs | Retirement (child needs a job) |
| $1,000 government seed | Yes — 2025–2028 births | No | No |
| Annual contribution cap | $5,000/yr | No federal cap; large gifts may need gift-tax reporting | Up to the child's earned income, capped at the annual IRA limit |
| Child must have earned income? | No | No | Yes |
| Tax on growth | Tax-deferred; taxed like a Traditional IRA at withdrawal | Tax-free when used for qualified education | Tax-free in retirement |
| When the money can be used | Locked until 18, then IRA rules apply | Anytime for education (otherwise penalty + tax on earnings) | Contributions anytime; earnings at retirement |
Bottom line: if your child was born in the 2025–2028 window, the free $1,000 makes a Trump Account hard to pass up as a starter account. For college-specific savings a 529 is usually still the better vehicle, and a custodial Roth wins for a teen who already has earned income.
Common mistakes & rules of thumb
The Trump Account is new, so the rules are easy to get wrong. A few things to keep straight before you plan around it:
- Rule of thumb: the $1,000 government seed is tied to a birth-year window (2025–2028). If your child was born inside it, the seed is the headline benefit — start there.
- Rule of thumb: treat the seed as a long-runway deposit. Left untouched, it has ~18 years to compound before the account holder can access it.
- Common mistake: assuming every child qualifies. Kids born outside the eligibility window don't receive the automatic seed money.
- Common mistake: expecting this tool to model ongoing contributions. It projects the seed and any starting balance forward; post-18 saving is better handled with the Compound Interest Calculator.
- Common mistake: confusing it with a 529 plan. They have different eligibility, contribution, and withdrawal rules — a Trump Account doesn't replace college-specific savings.
Frequently asked questions
What is a Trump Account?
A Trump Account (IRS Section 530A, created by the One Big Beautiful Bill Act) is a new tax-advantaged custodial account for children under 18, similar to a locked IRA. It can receive a one-time $1,000 government contribution plus up to $5,000/year (inflation-adjusted) in individual contributions, invested only in low-cost broad-market index funds until the child turns 18.
Who qualifies for the $1,000 government seed money?
Only U.S. citizens with a valid Social Security number who were born between January 1, 2025 and December 31, 2028. The seed is a one-time pilot-program contribution and requires an active election — it is not automatic — by filing IRS Form 4547.
How much can I contribute to a Trump Account?
Up to $5,000 per year (inflation-adjusted) per child, from parents, relatives, or others, using after-tax dollars. The first individual contribution can't be made until after July 4, 2026. Contributions must go into low-cost (0.1% expense ratio or less) broad U.S. stock index funds — no cash positions, no stock-picking.
Can I withdraw money before the child turns 18?
No, with narrow exceptions (death of the beneficiary, transfer to an ABLE account at 17, or transfer to another Trump Account). The money is locked until January 1 of the year the child turns 18.
What happens to a Trump Account when the child turns 18?
On January 1 of the year the child turns 18, the account starts following Traditional IRA rules, including the 10% early-withdrawal penalty framework. It technically remains a Trump Account until the balance transfers into an actual Traditional IRA in the child's name.
Can an employer contribute to a Trump Account?
Yes. An employer can contribute up to $2,500 per year toward the Trump Account of an employee's dependent child. That employer contribution is excluded from the employee's taxable income, and it counts within the child's $5,000 annual contribution limit — it isn't on top of it.
What can the money be invested in?
Only low-cost, broad-based U.S. stock market index funds — roughly a 0.1% expense ratio or lower. No cash positions, no bonds, and no individual stock-picking while the child is under 18.
How is a Trump Account taxed when the money comes out?
Contributions go in with after-tax dollars, and the account grows tax-deferred. Once it follows Traditional IRA rules, withdrawals are taxed as ordinary income, with the usual 10% penalty for withdrawals before age 59½. This is not a Roth — the gains are not automatically tax-free.
Can grandparents or other relatives contribute?
Yes. Parents, grandparents, other relatives, and even unrelated individuals can contribute. But every contribution combined counts toward the same $5,000 annual per-child limit.
My child was born before 2025 — can they still have an account?
They can have a Trump Account and receive contributions, but they don't get the $1,000 federal seed. That one-time deposit is limited to U.S.-citizen children born between January 1, 2025 and December 31, 2028.
Official sources
Trump Account rules are set by statute and IRS guidance, and some mechanics are still being finalized. Check the primary sources before you act:
- IRS — Treasury/IRS guidance on Trump Accounts (Notice 2025-68)
- Federal Register — Trump Accounts rule