Automatic $1,000 payment for newborns: how to claim and who is eligible
A new birth bonus. This is how the new “Trump accounts” for newborns in the United States work.
From now on, every baby born in the United States will receive a financial boost, as the federal government will automatically deposit 1,000 dollars into a savings account called a Trump Account. These accounts, created under the One Big Beautiful Bill Act, are designed to help children begin their lives with savings for education, housing, or entrepreneurship.
Who qualifies and how do families claim the bonus?
The 1,000 dollar deposit is available for babies born between 1 January 2025 and 31 December 2028. Each baby must have a Social Security number, and parents or guardians must open the account on the child’s behalf.
Parents or guardians need to submit the official IRS form to activate the account. Although the mechanism can already be selected, contributions cannot begin until 4 July 2026.
Alongside the government deposit, family members, friends, employers, institutions, or philanthropic organisations may contribute up to 5,000 dollars per year for each child.
Children born outside the 2025 to 2028 window will not be eligible for the 1,000 dollar deposit. Instead, thanks to a private donation of 6.25 billion dollars from Michael Dell and his wife Susan Dell, many children under the age of ten in moderate-income areas may receive a 250 dollar payment if they meet specific criteria.
What happens to the money?
The funds must be invested in indexed funds in the United States stock market with very low fees, capped at 0.10 per cent per year, and will be managed by private financial institutions.
Children will not be able to withdraw any money until they turn eighteen. At that point, the account will operate similarly to a traditional IRA. They can use the funds for education, housing, starting a business, or saving for the future.
If families contribute regularly and leave the money invested for the long term, official estimates suggest that the fund could grow to 1.9 million dollars by the time the child turns twenty-eight.
The stated aim of the government and the plan’s supporters is to give every child a financial head start from birth, regardless of socioeconomic background. The accounts are intended to promote a culture of saving and investing, encouraging more families to engage with financial markets from the earliest stages of life.
Michael and Susan Dell say their donation is intended to extend this benefit beyond newborns, offering meaningful support to young children in low and moderate-income households. They said the contribution would provide a real boost to millions of children who otherwise would not have received this advantage at birth.
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Overall, the programme represents a significant effort to reshape how new generations in the United States approach saving and investing from childhood.
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