Trump Account commercial airs during Super Bowl: Here's what to know

During the Super Bowl, a commercial aired touting President Donald Trump’s new investment initiative for American children. 

The Super Bowl ad claimed "every American child gets an investment account," and that "millions will be pre-funded." 

Here’s what to know about the accounts, and how they work: 

"Every American child gets an investment account"

Big picture view:

A Trump Account is a savings tool where money is invested in the stock market on behalf of a child. 

A Trump Account is available for any American under 18, but it’s important to note that kids don’t automatically "get" the account; they must be opened by a parent like any other bank or savings account would be. 

"Millions will be pre-funded"

Big picture view:

The program gives a $1,000 bonus - or "prefunding" - to babies born during the calendar years of the Trump administration. 

To qualify for the $1,000 seed money from the U.S. Treasury, a baby must be a U.S. citizen, have a Social Security number and be born between Jan. 1, 2025, and Dec. 31, 2028.

By the numbers:

About 3.6 babies are born each year in the U.S., according to statistics from the CDC, which means more than 14 million babies are expected to be born during Trump’s second administration and be eligible for the $1,000 head start in their account.

How do Trump Accounts work?

Big picture view:

Once the account is open, the money earns money. Adding a little each month can help it grow even more, thanks to compound interest. 

Dig deeper:

Private banks and brokerages will manage the money, which must be invested in U.S. equity index funds that track the stock market and charge the accounts no more than 0.10% in annual fees.

Parents can contribute up to $2,500 annually in pretax income, much like they do for retirement accounts. Parents’ employers, relatives, friends, local governments and philanthropic groups can also pitch in. Yearly contributions are capped at $5,000, but contributions from governments and charities don’t count toward that total.

What's next:

When the child turns 18, they can withdraw the funds for specific purposes like continuing their education, buying a home or starting a business. 

There’s no deadline to spend the money, so it could also be left in the account to continue compounding. 

READ MORE: Trump shares new details on 'Trump Accounts' savings program

What they're saying:

Backers of the accounts say they want to introduce more people to the stock market and give even children born into poverty a chance to benefit from it. Critics point out the accounts do little to help children in their early years, when they’re most vulnerable and most likely to be in poverty.

Of note:

Some older kids may be eligible to get bonuses, or "pre-paid" Trump Accounts, thanks to donations. Donations have been announced by billionaires Michael and Susan Dell, as well as other hedge fund founders and investors in states such as Connecticut and Indiana. 

Some companies have also pledged they’ll match Trump Account contributions as part of their employee benefits. 

How to open a Trump Account

Timeline:

The accounts won’t be open for contributions until July 2026, according to the Trump Accounts website. 

Beginning in July, the White House says it will have a website where parents can register for the accounts.

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