Will Trump Accounts deliver for American children?

The launch of Trump Accounts, a new savings scheme aimed at encouraging investing among American children, was marked with the ringing of the Wall Street opening bell in the Oval Office this week. The accounts are now available to all US children under 18, with babies born between 2025 and 2028 qualifying for a $1,000 contribution to kickstart savings. The move comes as the cost of living remains a major issue ahead of November's mid-term elections, but tax experts told the BBC that families on lower incomes could lose out and that the scheme is too complicated. The accounts, named after the president, can be created for anyone under 18 with a valid social security number. Families, friends, and employers can contribute up to $5,000 per year per child, who can access the funds when they turn 18. By law, the money must be invested in a low-cost index fund designed for long-term growth, and while the money grows tax-free, withdrawals are subject to taxes and a possible 10% penalty if made before age 59 and a half, unless the money is used for higher education, a first home, or personal emergency expenses. Reaction to the scheme has been split. The White House argues that Trump Accounts offer millions of children a way into stock ownership, which it says has historically been "unevenly distributed." However, Will McBride, chief economist at the Tax Foundation, says the scheme is too complicated and will benefit only a "minority" of relatively well-off, well-informed families. Andy Blocker of Edward Jones believes the $1,000 contribution for babies born during Trump's second term removes a barrier to starting savings, while Adam Michel of the Cato Institute warns the scheme might "not live up to the rhetoric" and suggests many families would be better off using existing savings accounts.