The money in a Trump Account is invested in low-cost S&P 500 or U.S. equity index mutual funds and ETFs. The program caps expense ratios at 0.10%, meaning the investment fees are extremely low. You don't pick stocks or manage a portfolio. The account is designed to be simple and hands-off.
What Is an S&P 500 Index Fund?
The S&P 500 is an index of 500 of the largest publicly traded companies in the United States. An index fund that tracks it buys a slice of all 500 companies, so when you invest in one, you're effectively investing in the U.S. stock market as a whole.
The reason the Invest America program uses index funds is straightforward: they're diversified, they're low-cost, and they've historically produced strong long-term returns. It's the same approach that most financial professionals recommend for long-term, hands-off investing.
Can I Choose Where the Money Goes?
The program limits investments to government-approved low-cost index funds. You don't pick individual stocks or actively manage the portfolio. The goal is simplicity and long-term growth, not active trading. If you want more control over how your family invests, Grifin offers a different approach. You can download Grifin here and start investing in companies you already shop with, separate from the Trump Account.
How Does the Money Grow?
The account grows tax-deferred. That means your child pays no taxes on gains while the money is in the account. The growth compounds over time, which is why starting early matters so much.
Assuming a 6% average annual return, the program's own illustrative projections show that a child who starts with the $1,000 seed and receives $5,000/year in contributions could have around $191,000 by age 18. See the full growth projections here.
Who Holds the Account?
Initially, accounts are managed by the U.S. Treasury. After the program launches in July 2026, families will be able to roll over to a participating financial institution. That rollover option is what Grifin is building toward, so families who want to bring their Trump Account under the same roof as their other investments will have that option.
Is the Money Safe?
The account is invested in broadly diversified U.S. equity index funds, which means the value goes up and down with the stock market. Like any investment, it can lose value in the short term. But over long periods, U.S. equity markets have historically grown. A child who opens an account at birth has 18 years for the market to recover from any short-term dips before the account converts to an IRA.
What Happens to the Investment When My Child Turns 18?
At 18, the Trump Account converts to a traditional IRA. The money stays invested, your child takes control of the account, and it continues to grow under standard IRA rules. Withdrawals before age 59½ come with the same 10% penalty as any traditional IRA.
See the full breakdown of how Trump Accounts work here.
Find out if your child qualifies at investamericaquiz.com.
Wondering about something specific? Here's every question people are asking about Trump Accounts.
This post is for educational purposes only and is not tax, legal, or investment advice. Grifin is not affiliated with the U.S. government or the Invest America program.
