You may have heard about Trump Accounts, the new investment accounts you can open for any child under 18. For kids born 2025 through 2028, they come with a $1,000 contribution from the government. Everybody sees the free $1,000. Fewer people are asking what happens to it after.
A Trump Account is treated as a traditional IRA, not a Roth or a 529. The growth is not tax-free. Earnings come out taxed as ordinary income.
Take the $1,000 if your child qualifies. Then think hard about whether the rest of your savings belongs there or somewhere more tax-efficient.
That's the short version. On the Fusion CPA blog I walked through the whole thing: how Trump Accounts really work, and what the traditional-IRA treatment means once the money starts coming out. If you're deciding where your kids' savings should actually go, read this first.