How great would it be that the country you live in gives you money for your baby? Well, the U.S. is doing it, the government has created a new program to financially support babies since the first day of their lives. If you have a baby or are planning to have one, this article is going to be of your interest. So, let’s find out all about the program.
The new $1,000 payment for your baby
The U.S. government has started a new benefit for newborns. With this program, every baby born in the U.S. within a specific period will automatically receive $1,000. This money will be deposited in a special account called ‘’Trump Account’’.
The aim of this program is to help babies start their lives with savings that can later be used for important things like education, housing, or starting a business. The account is meant for the baby’s future, not for immediate spending.
Who qualifies for the payment?
Not every baby will receive this benefit. To be eligible for it, the baby must follow these conditions:
- The baby must be born between January 1, 2025, and December 31, 2028.
- The baby must have a Social Security number.
- A parent or legal guardian must open the account on behalf of the baby.
What parents or legal guardians should do
Even though the government deposits the money, parents or legal guardians must do some paperwork to activate the account: open the Trump Account for the baby and submit the official IRS form required to activate the account.
Even though families can already select how the account works, no contributions can begin until July 4, 2026.
Can other people add money to the baby’s account?
Sure, they can! Apart from the $1,000 from the government more people can contribute to the baby’s future:
- Family members.
- Friends.
- Employers.
- Institutions.
- Philanthropic organizations.
Everybody is welcome to contribute, but they can deposit up to $5,000 per year in the account of each baby.
What about the babies who are not eligible?
Babies who weren’t born in the 2025-2028 period won’t receive the $1,000 from the government. However, thanks to a private contribution of $6.25 billion from Michael Dell and his wife Susan Dell, some babies younger than 10 years old who live in moderate-income areas could receive a $250 payment, as long as they meet specific requirements.
How the money is managed and invested
The money in the Trump Account must be invested in U.S. stock market index funds. These investments have very low management fees, limited to 0.10 percent per year, and are handled by private financial institutions.
The child cannot withdraw any money until they turn 18 years old. Once they reach that age, the account works similarly to a traditional IRA.
Usage of the money in the future
Once the baby becomes an adult, they will be able to use the money in their account for important things in life, such as:
- Paying for education.
- Buying or helping to pay for a home.
- Starting a business.
- Saving for the future.
The creation of this program
The main purpose of this program is to give every child a financial head start, regardless of their family’s income level. Supporters believe this will encourage saving and investing from an early age and help more families engage with financial planning.
Michael and Susan Dell explained that their donation aims to extend these benefits to children who would otherwise miss out, especially those in low- and moderate-income households.
So…
For families, this means a new opportunity to think about long-term financial security for their children from the very beginning. While the system has rules and limits, its overall goal is clear: to give children a stronger financial foundation as they grow. Do you think this is a good idea?