Welcome to Kerr Wealth Kernels.
A new savings vehicle is getting attention from parents, grandparents, and business owners: Trump Accounts. Despite the political name, the planning question is straightforward: could this new account help give children a stronger financial foundation?
Trump Accounts are a new type of individual retirement account for children. Parents, guardians, and certain other authorized individuals may establish an account for an eligible child who has not turned age 18 before the end of the calendar year in which the election is made and who has a valid Social Security number. For children born between January 1, 2025, and December 31, 2028, the federal government may provide a one-time $1,000 pilot program contribution.
Contributions cannot begin before July 4, 2026. Under current IRS guidance, individuals and employers may contribute up to $5,000 per year, and employers may contribute up to $2,500 per year toward an employee’s or dependent’s Trump Account without that amount counting as taxable income to the employee. The funds generally must be invested in certain mutual funds or ETFs that track a U.S. stock index, such as the S&P 500.
So, where might these accounts fit?
For families with young children, Trump Accounts may become another tool in the broader planning toolbox—alongside 529 plans, custodial accounts, Roth IRAs when earned income exists, and traditional savings. The key difference is the long-term retirement angle: generally, money cannot be withdrawn before the year the child turns 18, and after that point the account is treated similarly to a traditional IRA.
That structure can be powerful, but it also means families should think carefully before contributing. A Trump Account may help a child benefit from decades of potential compounding, but it is not necessarily the right priority for every household. Parents may still need to balance education funding, emergency savings, insurance needs, and their own retirement plans.
The biggest takeaway: do not view Trump Accounts in isolation. The value comes from how they fit into your full family balance sheet.
At Kerr Wealth Advisors, we help clients evaluate new planning opportunities through the lens of their broader goals, tax picture, cash flow, and legacy wishes. For parents and grandparents who want to create a lasting financial head start for the next generation, Trump Accounts may be worth a closer look.
Ready to see how this could fit into your family’s plan? Contact Kerr Wealth Advisors and we can walk through the numbers together.
This is educational only and not personalized investment, tax, or legal advice. Please consult your tax professional regarding your specific situation.
H. Brad Kerr IV, CRPC®, RIS
Vice President / Wealth Management, Financial Advisor
215.619.3926 / bkerr4@janney.com
1767 Sentry Parkway West, Suite 110
Blue Bell, PA 19422
Janney Montgomery Scott LLC Financial Advisors are available to discuss all considerations and risks involved with various products and strategies presented. We will be happy to provide a prospectus, when available, and other information upon request. Janney Montgomery Scott LLC, its affiliates, and its employees are not in the business of providing tax, regulatory, accounting, or legal advice. These materials and any tax-related statements are not intended or written to be used, and cannot be used or relied upon, by any taxpayer for the purpose of avoiding tax penalties. Any such taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor. Janney Montgomery Scott LLC is a member of the New York Stock Exchange, Financial Industry Regulatory Authority and the Securities Investor Protection Corporation.
For more information about Janney, please see Janney’s Relationship Summary (Form CRS) on www.janney.com/crs which details all material facts about the scope and terms of our relationship with you and any potential conflicts of interest.
