President Trump is hosting the heads of the New York Stock Exchange and Nasdaq in the Oval Office today to mark the official launch of the children’s investment accounts, dubbed Trump Accounts. The accounts went live on July 4.
Exchange officials will ring their respective opening bells directly from the White House — a symbolic moment meant to signal that the stock market is open for everyone’s long-term wealth-building.
Trump Accounts are custodial-style traditional IRAs for children under 18, owned by the child but administered by a parent or guardian. Investments are limited to low-cost index funds and ETFs tracking broad US equity indexes, such as the S&P 500. There are no withdrawals permitted before age 18.
Read more: Trump Accounts explained: How they work, who qualifies
US citizens born between 2025 and 2028 are eligible for a $1,000 seed contribution directly from the US Treasury.
McKinsey estimates in a new study that Trump accounts could generate between $80 billion and more than $900 billion in long-term asset accumulation for lower-wealth households over the next decade.
But the highly publicized moment will have a key challenge in becoming a wealth builder for many US households.
Economic mobility is often associated with education, employment, and income growth, but it’s also influenced by asset ownership and how it’s managed over time.
McKinsey estimates that 40% to 50% of American children are born into low-income or economically vulnerable households. At the same time, intergenerational income mobility has declined.
Roughly 90% of Americans born in 1940 earned more than their parents, compared with 50% of those born in the 1980s, McKinsey found.
Wealth disparities in the United States also remain stark.
The bottom 25% of households hold very little wealth, McKinsey noted, with a median net worth of $3,500 and limited ownership of financial assets. By contrast, households in the 75th to 89.9th percentile hold more than $1 million in median net worth. These disparities reflect unequal access to assets that accumulate and compound over time.
For Trump accounts to be successful, lower-income households will have to participate. If not, the accounts could accumulate for the top earners and widen the wealth gap further in the decades to come.
“If participation and contributions remain uneven and concentrated among higher-wealth households, asset accumulation may disproportionately benefit households already positioned to contribute consistently, “McKinsey said.
