The Daily Signal - Trump Accounts: Setting the Record Straight | E.J. Antoni, Ph.D

Episode Date: February 9, 2026

A product of the “Big Beautiful Bill,” Trump Accounts give American children — sorry, illegal aliens, this one is for us — a “tremendous” financial head start on life, providing the means to pay for college or put a down payment on a home, along with exposure to equities, something roughly 1 in 3 Americans currently do not have. If you make the maximum annual contribution of $5,000 to a Trump Account, it could be worth: At age 18: $300,000 At age 28: $800,000 At age 55: $10 million All courtesy of the power of compounding returns, argues Heritage Foundation Chief Economist E.J. Antoni in this special video commentary. 👉For more videos like this, subscribe to The Daily Signal’s YouTube channel and enable notifications to be alerted the second a new video drops: https://www.youtube.com/dailysignal?sub_confirmation=1 Learn more about your ad choices. Visit megaphone.fm/adchoices

With Amex Platinum, $400 in annual credits for travel and dining means you not only satisfy your travel bug, but your taste buds too. That's the powerful backing of Amex. Conditions apply. Trump accounts are a great way to give kids a financial head start on life, whether that means paying for a traditional four-year college or community college or trade school or buying a home, starting a business, etc. Your kids get to watch their accounts grow. learn the ups and downs of the market, have a vested interest in the financial world, and see firsthand how public policy affects equity prices of the companies in their portfolios. This whole mechanism for investing is bringing Main Street into Wall Street,

as the Treasury Secretary Scott Besson has often said. Roughly one in three Americans have no exposure whatsoever to equities, not in direct stock holdings, not in pension plans, not in 401ks or Roths or anything else. With Americans now starting life with equity exposure, every American becomes a shareholder and therefore a stakeholder in a higher tier of American capital markets and American capitalism. If you contribute the maximum to your child's Trump account, it'll be worth about 300 grand when your kid turns 18. That's enough to pay for college and have money left over for most folks. It gives the child a tremendous financial head start on life. Hello, this is E.J. Antony for The Daily Signal. I'd like to talk today about Trump accounts,

what they are, how they work, but also address some of the misnomer's and criticisms. In short, Trump accounts were created as part of the working family's tax cut, better known as the Big Beautiful Bill, signed into law last year by the president. The accounts are tax-advantaged with a structure that borrows from existing specialized accounts like a traditional 401k or a 529 plan. But they offer much more flexibility than many similarly designed plans. When a child turns 18, they'll be able to use the money for a four-year college, but also for an associate's degree at a community college or a trade school. They don't even have to use the money for education, but instead can use it to buy a home or start a business if they want to be entrepreneurs. Additionally, for American children born any time between

January 1, 2025 and December 31, 28, there's a special pilot program contribution of $1,000 from the Treasury that will be deposited into the child's account. But even if a child was born before 2025 and isn't eligible for the $1,000 in seed money from the Treasury, the child's parents can still open a Trump account for the kid, provided he or she is still. under 18 and has a valid social security number. Sorry illegal aliens, this one's just for us. Now let's throw some numbers in so we can better understand these Trump accounts. Total contributions from parents, employers, charities, etc. can be up to $5,000 annually and the money can be allocated in low-cost index funds, so that'll include some mutual funds and certain ETFs, for example.

As the kid grows, their account grows with them, courtesy of the power of compounding return turns. If you contribute the maximum to your child's Trump account, it'll be worth about 300 grand when your kid turns 18. That's enough to pay for college and have money left over for most folks. Or it's an exceptionally large down payment on a home. In fact, in some markets, it's enough to buy a home outright or at least nearly enough. And it'll cover the most expensive trade school in the country several times over. In short, it gives the child a tremendous financial head start on life. And if for some reason the 18-year-old doesn't want to use the money, maybe he or she has a scholarship for a college or some other special circumstance, then that young American can just keep saving.

If you continue with those annual contributions until age 28, you'll have about $800,000, which is enough to buy outright the median price home in almost all markets in the country. And if you just want to treat your Trump account like a traditional IRA and continue maxing out your annual contributions, you'll hit 55 and have well over $10 million. That's the power of compounding returns. It's especially powerful when you consider that Trump account contributions don't even count to the annual maximum for traditional IRAs. So this means that you can actually invest more each year as you save and plan for retirement. This whole mechanism for investing is bringing Main Street

into Wall Street, as the Treasury Secretary Scott Besson has often said. Roughly one in three Americans have no exposure whatsoever today to equities, not in direct stock holdings, not in pension plans, not in 401Ks or Roths or anything else. But with Americans now starting life with equity exposure, every American becomes a shareholder and therefore a stakeholder in a higher tier of American capital markets and American capitalism. That's a good thing. And it even helps with the Treasury Secretary's push for financial literacy among Americans, especially the young. Look, there's no substitute for learning by doing, and part of learning financial literacy is seeing from an early age how an investment grows over time. And contrary to what some critics have said, and we'll assume they're very well-intentioned,

this isn't socialism. It's the opposite. Socialism is the government telling you what to do, but Trump accounts provide you a tremendous amount of freedom and flexibility. You have much more choice with a Trump account than a 529 plan, for example. And unlike the Ponzi scheme of Social Security, your investment in a Trump account is a true investment that you can allocate in private businesses and track it over time. Additionally, Trump accounts are not government funded, at least not primarily. The seed money from the Treasury applies to children born during Trump's four years, and that's it. Nearly all the contributions will come from parents, employers, and private philanthropy. Many large corporations and even the Heritage Foundation have announced various matching contributions

for employees with kids. That's the free market in action. And with equity markets booming today, the Dow Jones Industrial average over 50,000 for the first time, and gains expected to continue as investment pours into the United States, this is a great environment in which to get more young Americans into the market. So to sum up, Trump accounts are a great way to give kids a financial head start on life, whether that means paying for a traditional four-year college or community college or trade school or buying a home, starting a business, etc. Your kids get to watch their accounts grow, learn the ups and downs of the market,

have a vested interest in the financial world, and see firsthand how public policy affects equity, prices of the companies in their portfolios. That's a win for kids, for families, and our future. This is E.J. Antony for The Daily Signal.