Trump Accounts could grow into retirement savings: Bessent says child accounts may complement Social Security

US Treasury Secretary Scott Bessent said the child savings accounts known as Trump Accounts could work alongside Social Security and help improve retirement security for younger Americans.

Scott Bessent says Trump Accounts could boost retirement savings alongside Social Security. (AP Photo)Bessent said the accounts could give children a separate pool of money that may grow for decades and later be used for retirement. He made the comments at an event in Harrisburg, Pennsylvania, on Monday, while highlighting the Trump Accounts, according to Yahoo Finance.

Bessent pointed to the different ages at which people can start claiming Social Security — 62, 65 or 70. He said that if people keep their Trump Accounts invested until retirement age, they could have a substantial nest egg in addition to their Social Security benefits.

His argument is that the accounts could give future retirees another source of money instead of relying only on Social Security. Bessent said the accounts could continue growing and help meet retirement needs later in life, according to Yahoo Finance.

The Treasury Department moved the Trump Account system to automatic enrollment from October 1, instead of relying only on people to voluntarily sign up for an index-fund investment. The change was made to give more children access to the accounts.

Nearly 70 million children under age 18 who have valid Social Security numbers now have Trump Accounts established in their names. That number has risen sharply from about 7 million signups reported the previous week. The accounts may already exist in a child's name, but parents or guardians still need to claim them.

Parents can claim their child's Trump Account through the official Trump Accounts app. They have to verify their identity and their relationship to the child. They must then review the child's information and accept the account's terms.

Eligible children can receive a $1,000 initial contribution, or seed money. Children born during President Donald Trump's second term are eligible for the $1,000 seed contribution. However, the $1,000 payment will not be made automatically into newly auto-enrolled accounts. A parent or guardian must first claim the account, according to Yahoo Finance.

Parents can contribute as much as $5,000 a year to a Trump Account. Employers can also contribute money to the accounts and allow workers to help fund them. This means the accounts can grow beyond the initial government contribution if families, employers or other eligible contributors continue adding money.

Children under 18 can also qualify for philanthropic contributions to their Trump Accounts. These contributions can be added automatically to the child's account when they qualify. This creates another possible source of money for children whose families may not be able to make large contributions themselves.

Bessent said children who start building savings while they are young could see their money grow significantly over several decades. He estimated that a child in kindergarten who starts with a couple of thousand dollars could eventually have about $500,000 by retirement age. The estimate is based on the money remaining invested and growing over a long period. Bessent described the wider goal as creating an “ownership economy” in which more Americans become shareholders, according to Yahoo Finance.

Bessent said around 350,000 foster children across the US could be eligible for Trump Accounts. He said the federal government would work at the state, county or municipal level to make sure eligible foster children are included. First Lady Melania Trump had pushed for this effort earlier in the summer.

New rules that took effect last week also allow wealthy individuals to help fund Trump Accounts for other children. They can do this through controlled charities using individual stocks. These charitable programs can target groups of at least 5,000 children. The children can be selected based on factors such as their age, geographic location, or both.

Gwynne Shotwell, president of SpaceX, pledged more than 2 million shares this summer for children aged 11 to 17 living in lower-income areas. The contribution is an example of how wealthy individuals or organisations could use the new rules to provide investments to groups of children, according to Yahoo Finance.

US government officials have indicated that other wealthy individuals are also preparing to move multibillion-dollar equity portfolios into Trump Accounts under the revised rules. Once those transfers are completed, the equity shares are expected to move directly into the individual children's accounts. This could give some children access to investments that they otherwise might not have received.

Trump Accounts are designed to continue beyond childhood. When a child turns 18, the account automatically transitions into an individual retirement account (IRA).

This is important to Bessent's retirement argument because money saved during childhood could remain invested and potentially keep growing into adulthood. The long-term idea is that money started for a child could eventually become part of that person's retirement savings alongside Social Security.

Durva More is a Senior Content Producer at Hindustan Times, where she covers finance, and global news. She brings experience across digital and television journalism, with a strong focus on breaking news, business reporting, and international affairs. Before joining Hindustan Times, Durva worked as an International News Writer at The Economic Times, covering a diverse range of subjects including global politics, business, sports, entertainment, and major world events. She also worked as a Business Reporter with NDTV Profit. A postgraduate diploma holder in Journalism from the Asian College of Journalism, Durva is passionate about field reporting and storytelling. She thrives on the adrenaline of chasing stories, speaking with people from different walks of life, and amplifying voices that deserve to be heard. Her reporting is driven by curiosity, accuracy, and a commitment to making complex subjects accessible to readers. When she is not chasing stories or covering breaking news, Durva enjoys reading books and painting. She loves exploring new ideas, meeting people, and learning about different perspectives. For her, both journalism and art are ways to understand the world and tell stories that matter.Read More