Trump Account vs. 529 Plan
Two ways to save for your child. The 529 is built for school; the Trump Account is built for long-term wealth. Run your own numbers below and see how they actually differ.
Up to $1,500 head start
A $1,000 government seed for kids born 2025–2028, plus $500 from Nino for every child and up to $2,500/yr from an employer. Locked until 18, then becomes an IRA.
Tax-free for school
Withdraw anytime for tuition and education costs, and growth comes out completely tax-free. No federal contribution cap.
converts to an IRA
your $1,500 in seeds grows to $4,738 by 18
tax-free for school
The 529 has no contribution cap; the Trump Account tops out at $5,000/yr.
Maybe worth a trust. This trajectory clears $250,000 by 18, which is often where a trust starts to earn its legal cost, mainly for estate control and keeping assets out of your kid's hands the moment they turn 18.
Get $500 for your kid's Trump Account
| Trump Account | 529 Plan | |
|---|---|---|
| Purpose | Long-term wealth | College & K–12 education |
| Head start | $1,000 for U.S. citizens born 2025–2028 | None |
| Annual contribution limit | $5,000 combined per year, including up to $2,500 from an employer | No federal cap (~$19,000/yr gift-tax-free); employer contributions not allowed |
| Tax on withdrawals | Ordinary income on earnings, even for qualified uses | Tax-free for qualified education |
| Investment choices | U.S. equity index funds only, ≤0.10% fee | Broad: funds, target-date portfolios, bonds |
| Access & control | Locked until 18, then becomes the child's own traditional IRA that they control from there | Anytime for qualified education; the account owner keeps control indefinitely |
Gains are taxed as ordinary income
Family money goes in after-tax but comes out taxed at income rates, not the lower capital-gains rate, so a Trump Account can lag even a plain brokerage account for education savings.
Still, grab the free $1,000
The government seed is free money for eligible newborns. Open one to capture it, even if you fund the rest elsewhere.
Your kid controls it at 18
The account becomes theirs. They can do anything with it, up to and including cashing it out entirely.
Kiddie-tax trap for college
Liquidate it for tuition while they're still a student and the gains can be taxed at your rate, not the child's.
Financial-aid impact is unclear
Child-owned assets are usually assessed more heavily for aid, and formal Trump Account treatment isn't settled yet.
Grandparent-owned 529s are aid-invisible
As of the 2026-27 FAFSA cycle, a grandparent-owned 529 counts as neither an asset nor student income, which is often a better aid outcome than a parent-owned account.
Illustrative estimate, not financial or tax advice. Assumes a 22% ordinary income tax bracket. 529 growth is tax-free when used for qualified education; a Trump Account's earnings are taxed as ordinary income on withdrawal even for qualified uses, since it converts to a traditional IRA at 18. Many families use both.
Frequently asked questions
Join Nino, get $500 for your kid's Trump Account.
Book a free 25-minute consultation. You'll leave with a clear read on where you stand and at least one concrete way to save or earn more, whether or not you become a client.
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