If you’re wondering whether a Trump account is right for your child or grandchild, this video breaks it down. Beau Wirick, Wealth Advisor at Morton Wealth, shares his firsthand experience opening one for his son: what the government provides, who can contribute, how taxes work, the setup process, and key alternatives to consider.

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Featuring

Beau Wirick, Wealth Advisor, Morton Wealth

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Watch the Full Video

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Key Takeaways

• The federal government will make a one-time $1,000 contribution to your child's account. This applies to children born between 2025 and 2028. It is a no-brainer starting point for any parent or grandparent with a child in that window.
• Annual contributions are capped at $5,000 per year. Anyone can contribute, including family members, employers, and charitable organizations. Employers can make a $2,500 annual contribution on behalf of an employee's child, and that contribution is federally tax deductible for the company.
• The tax treatment is complicated and not fully resolved at the state level. Contributions are made with after-tax dollars. The account grows tax deferred. When the child converts it to a Roth IRA at 18, or withdraws from it at 60, the growth portion is taxable and the contribution portion is not. Not all states currently comply with the tax treatment, and tracking the basis over time is going to be administratively burdensome.
• Opening the account involves meaningful administrative friction. As of now, Trump accounts can only be opened at Robinhood, not at Schwab, Fidelity, or other custodians. The process requires filing a Form 4547 with the IRS, creating an account on the Trump accounts website, downloading the app, and verifying both the parent's and child's identity.
• This is one option among several for building wealth for a child. UTMA accounts, 529 plans, custodial Roth IRAs, and taxable brokerage accounts held in the parent's name are all alternatives worth discussing with an advisor before deciding which structure fits best.

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Questions This Video Answers

What is a Trump account?

A Trump account is a new type of tax-advantaged investment account available for children under the age of 18. It functions as a retirement account for minors. Children born between 2025 and 2028 are eligible for a one-time $1,000 contribution from the federal government. Adults cannot open one for themselves, but parents, grandparents, and other family members can open and contribute to one on behalf of a child.

Who can contribute to a Trump account?

Anyone can contribute to a child's Trump account, including parents, grandparents, and other family members. Employers can also make a $2,500 annual contribution on behalf of an employee's child, and that employer contribution is federally tax deductible. Charitable organizations can contribute unlimited amounts as long as they give the same amount to every child within a defined demographic group.

How much can you put into a Trump account each year?

The annual contribution limit is $5,000, not including contributions from charitable organizations. This limit applies to the combined total from all sources other than qualifying charities.

How are Trump accounts taxed?

Contributions are made with after-tax dollars and are not deductible. The account grows tax deferred. When the child turns 18, they have the option to convert the account to a Roth IRA. When funds are eventually withdrawn, the growth is taxable and the original contribution amount is not. The tax treatment adds complexity because not all states have adopted conforming rules, and tracking the contribution basis over many years will require careful record keeping.

Where can you open a Trump account?

As of now, Trump accounts can only be opened through Robinhood. They are not yet available at Schwab, Fidelity, or other major custodians. The process requires filing a Form 4547 with the IRS, creating an account on the Trump accounts website, downloading the dedicated app, and verifying both the parent's and child's identities.

What are the alternatives to a Trump account for saving for a child?

Several other account structures are worth comparing. UTMA accounts offer flexibility with no contribution limits and broad investment options. 529 plans are designed specifically for education expenses and offer state tax deductions in many cases. Custodial Roth IRAs allow a child with earned income to build tax-free retirement savings. A taxable brokerage account held in the parent's name and later gifted to the child is another option. Each structure has different tax treatment, contribution rules, and withdrawal restrictions. Talking with an advisor before choosing is the right starting point.

Why This Matters for Parents and Grandparents Planning for a Child's Financial Future

Trump accounts are new and generating real interest, but the decision to open one should not be made based on the headline alone. The $1,000 government contribution is a genuine benefit for eligible children. The administrative complexity and tax tracking are real drawbacks. And for many families, other account types may be better suited to their goals.

• Parents of children born between 2025 and 2028 who want to understand whether the free government contribution is worth the setup process
• Grandparents or family members looking for a meaningful and lasting gift option for a young child
• Business owners considering whether the employer contribution benefit makes sense as a company perk

At Morton Wealth, decisions about account structures for children belong inside the broader conversation about your financial plan. If you are weighing Trump accounts against other options for a child in your life, your advisor can walk through what fits your situation.

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Disclosures: Information presented herein is for discussion and illustrative purposes only and is not intended to constitute financial advice. The views and opinions expressed by the speaker are as of the date of the recording and are subject to change. These views are not intended as a recommendation to buy or sell any securities, and should not be relied on as financial, tax, or legal advice. You should consult with your financial professional, accountant, or tax professional before implementing any transactions or strategies concerning your finances.