What is a Trump Account and what is its impact for college savings?

Trump Accounts were created as part of passage of the One, Big, Beautiful Bill, to provide IRA-style savings accounts for children born between Jan. 1, 2025 and Dec. 31, 2025, according to a government website.

They are similar to traditional IRA’s because funds in the accounts will grow tax deferred. Eligible children may receive a one-time, $1,000 contribution from the federal government. Up to $5,000 a year can be deposited in the accounts,and the money is available for a beneficiary at age 18. Parents must enroll children in this program to receive the funds.

WVXU spoke with Jack Miner, vice provost of enrollment management at UC, and Gina Slayton, a wealth advisor for Bartlett Wealth Management, for a segment about who qualifies for the program, what it means for a family’s taxes and how the savings compare to a typical 529 plan. An IRS webpage offers more information on a 529 plan.

"One of the great things about this is it amplifies discussions about saving for college,” Miner told WVXU

Slayton says the seed money with a Trump account will be invested in a U.S. stock fund and without knowing future returns there are some assumptions made by federal officials based on past data. She says the federal government uses an annual rate of return of 10.5% but she says she would use a slightly less risky rate of 8% annually. Using her assumption the $1,000 seed money could grow to $4,000 potentially over 18 years.

“These are really meant to build long-term savings for kids,” Slayton told WVXU. “There are some interesting points about the Trump Accounts, also known as 530A accounts, they are built upon the IRA individual retirement structure. They are for children under the age of 18 and upon that year in which they turn 18, it turns into an IRA within the child’s name. It is an investment account.”

Miner weighed in on the Trump account and the traditional 529 plan.

“We really encourage everyone to invest in a 529 plan for their kid because it really does start to set up that concept of saving for college ,” Miner told WVXU. “What is nice about a 529 plan is it is built tax-free and the students are able to withdraw the funds tax-free.”

Miner says there are some differences between the Trump accounts and the 529 plans, which are typically state-based programs. The 529 plan won’t get the seed money from the federal government but he says there are a lot of opportunities for states to build incentives around their programs.

Listen to the entire interview with Miner and Slayton on WVXU’s website.