Philanthropic power couple Michael and Susan Dell have announced a monumental pledge of $6.25 billion to establish investment accounts for millions of American children. This substantial donation aims to jumpstart financial futures for 25 million eligible U.S. kids through the newly enacted Trump Accounts
program.
A Historic Philanthropic Gift
Unveiled recently, the Dells' contribution from their charitable funds will inject $250 into each qualifying child's account. These funds are designed to grow over time by investing in low-cost stock funds that mirror market indexes. Michael Dell, CEO of Dell Technologies, articulated the vision behind this initiative: The idea is to give millions of children a head start on saving for the future... we know that when children have accounts like this, even with modest sums, they have better outcomes in life.
Understanding 'Trump Accounts'
The Trump Accounts
program, signed into law this past summer as part of the One Big Beautiful Bill Act,
mandates that every American baby born between this year and 2028 will automatically receive an initial $1,000 from the U.S. Treasury. The Dells' gift specifically targets children aged 10 and under, born before January 1, 2025, who might be too old to receive the federal $1,000 payment.
Eligibility for the Dell Gift
To benefit from the Dells' generosity, children must possess a Social Security number and be aged 10 or younger, born prior to January 1, 2025. The program strategically focuses on reaching children in ZIP codes where the median income is below $150,000, ensuring the funds assist those most in need. The Dells anticipate their gift will reach nearly 80% of eligible children across three-quarters of U.S. ZIP codes. Parents are encouraged to establish a Trump Account
for their child to claim the $250 contribution, with Susan Dell advising parents to mark their calendars for July 4, 2026,
when accounts can be claimed.
How the Accounts Function
Money deposited into Trump Accounts is intended for long-term growth through investments in low-cost stock funds tracking market indexes. Upon turning 18, beneficiaries gain access to their accumulated funds, with options to convert the money into a retirement account, finance higher education, purchase a home, or launch a business. Parents and other contributors can add up to $5,000 annually until the child reaches 18.
Expert Insights and Potential Outcomes
Personal finance experts view Trump Accounts as a hybrid financial instrument, blending features of existing savings plans. The long-term value of these accounts varies significantly based on additional contributions. The White House projects that with maximum annual contributions, an account could swell to nearly $1.1 million by the beneficiary's 28th birthday. However, without further contributions beyond the initial seeding, the value could be considerably less, around $18,100. Despite the promise, key administrative details, such as who will open and hold these accounts, remain undefined. Charles Schwab advises families interested in the plan to consult a tax or financial advisor for guidance.
