Treasury Flips Trump Accounts to Auto-Enroll Every Eligible Kid

The Treasury Department changed the default for its new children's savings program this month. More than 60 million eligible children under 18 now have Trump Accounts opened in their names, after the department moved the program from opt-in signups to automatic enrollment. The accounts are a federally created investment vehicle for kids that went live on July 4, and until this month parents had to actively register their children through a tax return or an IRS portal. Fewer than eight million did, a fraction of the tens of millions who qualify.

The switch to automatic enrollment is meant to close that participation gap. The Treasury estimates that Trump Accounts under the new setup will add about two million accounts a year going forward. Madeline Brown, a senior policy associate at the Urban Institute, told CNN the move follows best practice from retirement-plan research, where automatic enrollment consistently outperforms opt-in signups. Brown added that the change keeps children from missing out on private charitable contributions, or the market gains those contributions earn, when no one has opened an account for them.

There is one detail families need to know before anything else. An account the Treasury opens on its own still has to be claimed by a parent or guardian before anyone can manage it or add money to it. The one-time $1,000 federal seed payment works the same way. It is reserved for children born from 2025 through 2028, and the Treasury will not deposit it automatically. Ben Henry-Moreland, a certified financial planner with the advisor platform Kitces.com, told CNBC that children eligible for the pilot money will not see it unless their families claim the account.

Claiming runs through the official Trump Accounts app, which is available for iOS and Android. A parent verifies their identity and their relationship to the child, reviews the account information, and accepts the terms, according to Gray News. Once claimed, the door opens to contributions from family members, friends, and employers.

What the accounts can and cannot hold

Trump Accounts, formally known as Section 530A accounts, were created by the One Big Beautiful Bill Act, signed last summer. During the growth period, which runs until the child reaches adulthood, the rules are strict. The money can sit only in low-cost, unleveraged funds that track broad American stock indexes, with fees capped at one-tenth of a percent. Individual stocks, sector bets, and bonds are off the table. No withdrawals are allowed during that period, apart from rollovers, excess contributions, or the death of the beneficiary. When the growth period ends, the account works much like a traditional IRA.

Private contributions are capped at $5,000 per child per year, and the federal seed money does not count against that limit. A recent Treasury rule change also lets families and donors contribute stock directly, as long as the shares stay untouched for five years before they can be sold. Full program details are laid out in CNN's one-stop FAQ on Trump Accounts and in MarketWatch's breakdown of the fine print.

The private money piling on

Washington is not the only source of funding. Michael Dell and his wife Susan pledged $6.25 billion to add $250 for children born between 2016 and 2024 who live in ZIP codes where the median income is $150,000 or less. Treasury figures put the number of children projected to qualify for the federal seed payment at 14.4 million, including 5.8 million from low- and moderate-income households.

Some large employers have pledged matching contributions for their workers' children, money that comes from company budgets rather than taxpayers. Melissa Elbert, a partner at the consulting firm Aon, told MarketWatch the automatic enrollment is a significant expansion of the program's reach, with one clear condition attached: parents still have to do the claiming themselves.

The structure borrows its logic from 401(k) plans, where automatic enrollment turned saving from a decision into a default. For younger readers, the practical angle is close to home: many are siblings, or future parents, of kids who now have Trump Accounts waiting for them. The money stays invested through childhood, so even small early contributions get decades to compound. The first step, though, is the one the Treasury cannot take for anyone. The account is already there. Claiming it is up to the family.