Roger Wicker

A new federal program, nicknamed "Trump Accounts," provides child savings accounts for children born during a specific period.

Each account starts with a $1,000 government deposit and can receive additional tax-free contributions.

A separate multi-billion dollar donation from Michael and Susan Dell will fund similar accounts for children in lower-income areas.

Despite its partisan name, the program has received bipartisan support for its potential to teach financial literacy and build wealth.

There's Republican policy and there's Democrat policy. There's also just plain good policy, said U.S. Sen. Roger Wicker and that is where Trump Accounts come in.

The child savings accounts are wrapped in layers of political rhetoric, having been named after the president and created in the controversial "One Big, Beautiful Bill Act" last year. But, Wicker told audience members at a Tuesday, April 7, panel the accounts are a nonpartisan measure that will help all children in the country.

"It is there to show a whole new generation of Americans how we develop wealth, and how you can do it even if you're starting off at the bottom tier of the economic rung," Wicker said. "This is not just for the people who've hit it great in business… This is for everybody."

The savings accounts, Wicker said, are earmarked for children born between 2024 and 2028, the duration of Trump's second presidency. Each account begins with it a $1,000 input from the Treasury Department, and they can receive as much as $5,000 in contributions from friends and family members each year.

Employers can also pay into the savings accounts. They are capped at $2,500 a year, which is included in the $5,000 annual total. Several companies, including conservative think tank The Heritage Foundation, have announced that they will offer independent contributions or match employee payments.

Trump Accounts are reserved for the children born during Trump's second term, but a more than $6 billion donation from Michael and Susan Dell, the philanthropist leaders of the Dell Corporation, is set to extend the impact of the program.

The donation, the pair announced in December, will start savings accounts for children born between 2014 and 2024 in zip codes with a median income below $150,000. Each child, an estimated 25 million in total, will receive approximately $250 in their account.

Every zip code in Mississippi qualifies for the Dell-funded accounts, Wicker said, and approximately 33,000 babies are born in the state every year, so he estimates that children in the state could receive more than $82 million in total.

Mississippians could expect Wicker, a Republican, to extol a Republican-sponsored bill pushed by a Republican president. But his praise for the program was echoed by his fellow panel members, including Jackson Mayor John Horhn, a Democrat.

"I don't agree with everything in the Trump administration, but this is a good deal," Horhn said. "It will incentivize young people to save, to learn about investing, and to learn how the American economic system works."

Joshua Hendrickson, the chair of the economics department at the University of Mississippi, said the accounts would maximize the benefits of savings because they start from such an early age.

"The major benefit of investing is the compound returns that you get," Hendrickson said. "Getting that percentage year after year after year really helps you to build, but to really get the benefit of the compounding, you have to start early."

The accounts, which grow tax-free, can be withdrawn from when the beneficiary turns 18, but Hendrickson said that leaving it untouched until retirement could be the most lucrative course.

"If you think about just letting this money compound over a 60-year period," Hendrickson said, "even if $1,000 is the only thing that's invested, given historical returns in the stock market, we're talking hundreds of thousands of dollars when you retire."

The accounts are also an educational experience, he said, giving kids a practical look at the way that the economy ebbs and flows.

"It's one thing to learn about these concepts in the classroom or have your parents or grandparents tell you about them," he said. "It's another thing when you have this account that you can watch grow over time, and you can actually see what all of those adults are talking about."

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Children will not automatically receive an account when they're born, unlike some similar, state-level programs. Parents have to file a tax form to open the account, meaning some kids won't have access to the money. Even without complete participation, handing $1,000 over to millions of children is expensive.

“It’s a trade-off that we have to make whenever we do appropriations or authorizations,” Wicker said. “In this situation, the feeling was that this could be a game changer for giving every single new baby a piece of the American dream.”

Wicker did not specify which other spending the federal government was opting to decrease or eliminate in favor of the childhood savings accounts.

Returning to the unignorable partisan nature of the program, Horhn advised Mississippians who disagree with the administration’s policies to ignore the name and focus on the positive impact that the accounts would have for their children.

“Just because the nickname of the program is Trump Accounts makes it no less a good deal,” Horhn said. “Our community is financially challenged… For a place like Jackson, this could be a godsend.”