The Basics on Trump Accounts
Forward Written by: Seth Raymond, Advisors Assistant & Grant Nailor, Financial Advisor
The One Big Beautiful Bill Act has continued to show impacts on Americans. It is important to stay up to date on all changes and changes to come. The latest changes are the creation of 530A accounts, also known as, Trump accounts. These new accounts can provide a new way to save for a young child’s retirement. Family, friends, and employers can contribute up to $5,000 per year in this account. In Trump accounts, funds can only be invested in U.S. securities that the treasury has preselected.
The following article provides some of the basic “need-to-know” information for these new accounts and a potential strategy to give your children a great head start. This includes a potential $1,000 seed investment from the government if your child was born between January 1st, 2025, and December 31st, 2028.
We would be more than happy to answer any questions you might have!
Below is the article from Financial Advisor Magazine:
Written by: Tracey Longo July 9, 2026
Hidden Roth Strategy in Trump Accounts Will Create ‘Tax-Free Millionaires’
Forget the government’s $1,000 seed contribution.
The biggest wealth-building opportunity in the new Trump Accounts, which went live July 4, may come nearly two decades later, when young adults can convert the accounts into Roth IRAs and potentially lock in decades of tax-free compounding.
That investment planning strategy could create a generation of “tax-free millionaires,” according to Adam Bergman, founder of IRA Financial and a tax and ERISA attorney, who said financial advisors should already be discussing the opportunity with young families and grandparents.
“I’m a big fan of this,” Bergman said. “My company is going to maximize its contribution opportunity for employees’ families to help them generate real wealth.”
Most of the attention surrounding Trump Accounts has centered on the federal government’s $1,000 seed contribution for eligible children born between 2025 and 2028. Bergman believes advisors are missing the much bigger planning opportunity.
“This will create tax-free millionaires,” he said. “If we fast-forward 30 or 40 years, these kids will turn into millionaires.”
Trump Accounts, formally known as Section 530A accounts, allow parents, grandparents and others to contribute up to $5,000 annually for children younger than 18. Employers also may contribute up to $2,500 annually, subject to the overall contribution limit. Unlike custodial Roth IRAs, children do not need earned income to receive contributions.
“The biggest benefit of Trump Accounts is you can make contributions from the day a child is born,” Bergman said. “Young kids don’t have income.”
That feature alone makes the accounts unlike any retirement savings vehicle previously available to children, he said.
“There are no income requirements,” Bergman said. “They have Roth-like features.”
During the beneficiary’s childhood, contributions grow tax deferred in low-cost U.S. stock index funds and exchange-traded funds. On January 1 of the year the beneficiary turns 18, the account automatically converts to a traditional IRA.
That’s where advisors have an opportunity to change a client’s financial future.
Rather than simply leaving the account as a traditional IRA, Bergman said advisors should evaluate whether converting some or all of the balance into a Roth IRA makes sense while the young adult is in a relatively low tax bracket. Although income taxes are owed on the account’s investment gains at conversion, future investment growth and qualified retirement withdrawals become permanently tax free. Even better, Roth IRA contributions—not earnings—can later be withdrawn tax- and penalty-free, creating flexibility for the child’s major milestones such as buying a first home or launching a business.
“The biggest challenge for young families is being able to buy their first home, build equity and manage debt,” Bergman said. “Hopefully when these kids are in their 30s, they can tap those tax-free contributions.”
For advisors, that creates a rare opportunity to help clients build wealth across generations while positioning children for decades of tax-free compounding.