I’ve heard from some of our clients who want to better understand the new Trump Accounts created under the One Big Beautiful Bill Act and the recent announcement that the Michael & Susan Dell Foundation is putting billions toward expanding them.

As always, my goal is to cut through the noise and give you a clear, practical explanation of what’s actually changing — and what, if anything, you should be doing.

What Is a Trump Account?

It’s a new type of individual retirement account (IRA) for kids that comes with a small amount of seed money from the government.

Here are the basics:

• Any U.S. citizen under the age of 18 can have one.
• Children born between 2025 and 2028 will automatically receive $1,000 from the federal government. A parent will need to file Form 4547 online beginning in 2026 to establish the account.
• Families can contribute up to $5,000 per year per child.
• Money is invested in broad U.S. stock index funds.
• The funds are locked until age 18 and then treated similarly to a traditional IRA for tax purposes.

The intent here is simple: give kids a small head start toward retirement that can grow over time.

A Few Things to Keep in Mind

These accounts are not a replacement for 529s, custodial accounts, or other long-term tools many of you already use. The $1,000 federal seed money is helpful, but on its own it won’t meaningfully change a child’s financial picture. The value in these accounts would come from consistent contributions over many years, just like with any other investment account.

Where the Dell Foundation Fits In

The big headline recently was the $6.25 billion pledge from the Michael & Susan Dell Foundation.

Their gift provides:

• A $250 deposit into Trump Accounts for children age 10 and under,
• Specifically, those who were too old to qualify for the federal $1,000 newborn deposit.
• The children also must live in ZIP codes where the median family income is below $150,000.

In other words, if you have a child or grandchild born before 2025, this may help them get a small amount into the same system.

As an example, the Dell Foundation pledge would impact my first grandchild, Ben, who was born in 2024. Residents in most of the Metropolitan Detroit area would qualify. There are, however, a number of zip codes that would likely not qualify based upon 2023 census data:

• 48070 (Huntington Woods) $188,229
• 48374 (Novi) $185,203
• 48025 (Franklin/Bingham Farms/Beverly Hills) $177,126
• 48302 (Bloomfield/West Bloomfield) $175,698
• 48168 (Salem/Northville) $173,671
• 48301 (Bloomfield Hills) $163,571
• 48009 (Bloomfield/Birmingham) $152,443

What’s Similar About the Federal Program and the Dell Grant?

Both are trying to do the same thing:

• Help kids start adulthood with something toward retirement — no matter how small.
• Both use the exact same account structure, investment rules, and long-term setup.
• And both are intended to encourage families to save more over time.

Where They Differ

• The Dell contribution is $250, not $1,000.
• It’s geared toward older kids (those born before 2025).

What This Means for Your Family

1. If your child or grandchild qualifies, it’s worth opening the account.
   Even modest annual contributions can compound meaningfully over 18+ years.
2. Don’t think of this as your core college plan or wealth-transfer strategy.
   Think of it as an add-on for the child’s retirement — one more tool in the toolbox.
3. If employers start offering contributions (allowed up to $2,500), take advantage.
   This is something we may see more companies explore.
4. For grandparents, this could be a nice, structured way to gift money annually.

At the end of the day, this isn’t about politics — it’s simply a new vehicle that can help families who choose to use it.

Final Thoughts

We will continue to monitor the details as they roll out, but the takeaway for now is straightforward: Trump Accounts offer a small but potentially useful starting point for long-term investing for kids. The Dell Foundation’s gift expands that opportunity to older children, but the real impact still comes from what families contribute over time.

As always, if you have any questions regarding this topic or other financial matters, don’t hesitate to contact our team of advisors at Bloom. We’re here to help!