A (5:31)
You heard it there first, folks. He said that you could see half a million dollars by the time they retire. Now, Besant may something here. You see, the money in these accounts is invested in a quote diversified portfolio of low cost index funds designed to maximize long term growth while minimizing risk, which is what an index fund does. It tracks the market, it's super diversified across hundreds of companies. Therefore you're not putting all your eggs in one basket. Now, the specific investments are government directed, which means you have no control over them. But you will be able to track your balance and performance through an app. So is all of that enough for 1000 bucks to grow to half a milli before retirement? Let's use our trusty investment calculator to fact Ch. Secretary Mr. Besant. Now we'll say you had a son last year and like the good millennial you are, you name him Braxley. It's a family name. Grandpa Braxley. Classic. Now, assuming little Braxley is eligible for a Trump account, he'll start with 1000 bucks of seed money. So we're gonna use our investment calculator here. The starting age. Let's say he's turning one. He was born in 2025. This year he'll be turning one. So we're gonna put that as the current age of retirement. Let's say 65 currently has the thousand dollar seed money from the Treasury. That's nice. So we're not gonna contribute anything after that. $0 monthly for the remainder of his working life. Now, with an average rate of return of let's say 10%. Let's see how much money that turns into. You seen what I'm seeing? $586,000. That's pretty wild. Now let's try to bump it up to 11% if we're gonna be a little more optimistic here and see what happens at 11%. $1.1 million, guys, that is insane. What 1% could do over 64 years of compound growth? I mean, it basically doubled. And remember, you contributed nothing to this account. There was an initial balance of 1,000 bucks from the treasury, and you did nothing after that. Let's say you forgot about it and your kid wakes up one day in retirement and goes, oh, yeah, my parents got that Trump account for me. Oh, look at that. $1.1 million to my name. Pretty amazing. So the math does check out. But let's tame our llamas for just a second, because opening a Trump account comes with some restrictions, and not everyone gets the free thousand bucks. So before we go any further, let's answer three important questions. Who can open a Trump account? Who gets the free thousand bucks? And what can the money be used for? So first, who can open a Trump account? The answer? Pretty much any child in the US under the age of 18 with a valid Social Security number. Now, you can open one of these accounts and through the Trump account's website, or on your tax return through the new IRS Form 4547, not to be confused with IRS Form 4567. All right, I'll just move on. Well, we're done with that now. Just about the time I figured out. I just found out about it. Guys, can I just have one? Next. Who gets the free thousand dollars? Any American child born between January 1, 2025 and December 31, 2028, qualifies for the one time $1,000 deposit. Oh. Oh. Your kid was born December 31, 2024. You couldn't have waited a few more hours? Ashley couldn't have waited to get the Pitocin. Oh, it was painful. Okay. My wife's gonna hate watching this. I have witnessed childbirth, and let me tell you, women, you are so much stronger than we will ever be. And the ones that go without any medication, no epidural. Move over, Bear Grylls. You got nothing on these ladies. That is a. That is a primal experience. You can hear that in a different country. That piercing screaming, Oof. Anyways, now, if your child was not born in that window, that four year window, you can still invest in a Trump account, even if they don't get the seed money. Specifically, you can contribute up to $5,000 per year. And it's not just parents who can add to it. Friends, family, countrymen, even an employer can chip in if they want to. And once your kid starts earning their own money, whether through babysitting, mowing lawns, or running a slime empire. They can contribute to the account themselves. Now, you might also be wondering where exactly the seed money is coming from, which is always a good question to ask when you see the government handing out free money. In this case, it comes from the U.S. treasury. And where do they get their money? You're looking at them, pal. Taxpayers like you and me. Yeah, because the government, I don't know if you knew, this doesn't actually create any money. They just print it, devaluing the dollar. And they redistribute the money that we give to them through taxes. There's Economics 101. Now, aside from the thousand dollars of seed money, Michael and Susan Dell of Dell Computers are offering an extra 250 bucks to K10 and under if they are among the first 25 million to sign up and live in a zip code with a median income under 150K. And to be honest, it's giving Scott's tots. Hey, Mr. Dale, whatcha gonna do? What you gonna do? Make our dreams come true. That's it. End scene. You're welcome. And it's harder than it looks. Okay, There's a lot of rhythm for me. That was embarrassing. So there's the 1000 bucks if your kid was born in that window. Or the 250 bucks if you qualify based on Mr. Dell's parameters. But hey, if you're too old to qualify for any of that, don't worry, you can still put more money back in your pocket every month by switching to a cheaper phone plan. Because some of you out here, you're paying a hundred bucks or more per line per month. But with Boost Mobile, you can get unlimited data, talk and text for just 25 bucks a month, which could unlock up to 600 bucks a year. Plus there's no contracts, no hidden fees, and the price stays the same forever. So make the switch today@boostmobile.com Ramsey and quick disclaimer. Based on average annual single line of payment of AT&T Verizon and T Mobile customers compared to 12 months on the Boost Mobile Unlimited plan as of January 2026. See website for full offer details. And since we're talking about long term investments, let's talk about investing in your long term comfort. And one brand that does this right is Cozy Earth, another sponsor of today's episode. Their clothing is next level quality. Okay? And my personal faves, the men's everywhere pant the brushed bamboo joggers and lest I forget, their socks. I love their socks. I only wear their socks. I will not wear Any other socks. Everything is comfortable enough to wear all day at home, but still look put together enough for going out to dinner, running errands, or impressing the teachers when you pick up Braxley from the school drop off line. The fabric is ridiculously soft. It's breathable, and it holds its shape so you don't look like you gave up halfway through the day. So upgrade your comfort by going to cozyearth.com george and use promo code George at checkout to to get 20% off. All right, the final piece of the Trump account puzzle. What can you actually use this money for? Well, first off, no one can touch the money in the account until the child turns 18. After that, the account gets transferred to the child's control and they have four options for using that money without a penalty tax. As of this recording, they can use the money to put down on a home as a down payment, start a business, pay for education, or my personal favorite, they can leave it alone and continue letting it grow for retirement. Let it grow. I can't go any longer. Can't afford a Disney lawsuit. Can't risk it. My singing is so good, they would copyright. Strike me for thinking that was the original recording done by the wickedly talented Adel Nazim. You like that throwback? Never forget Travolta. Never. You know he hasn't forgotten. I know. It's Idina Menzel. I listen to the song 45 times a day. I have a toddler. It's actually Idina Menzel. That's how I imagine you're typing at home when you say that. Pecking at your keyboard. You chicken, you coward. Can't even have a real avatar. It's some kind of anime AI slop. I can't take you seriously if you don't have your face, your actual face on the avatar. Don't comment. Negativity. If you don't have your actual face and your real name tied to it. I'm out here. Real face, real name. Not hiding behind my screen, baby. So clearly, as I digress, this is going just like the State of the Union, okay? Long winded, lot of rabbit trails and a lot of anger for no reason. So clearly these accounts have some real benefits and some genuine limitations. Genuine. Which means we need to answer one final question before we hit the road. Should you invest in a Trump account? Well, let's start with this. If your child qualifies for the thousand dollar seed money, take it. That is free money. And it will grow as long as you leave it alone. And here's an interesting wrinkle. Once a Trump account holder turns 18 and converts to a traditional IRA, they could potentially do a Roth conversion. Now unlike a 529 plan rollover, which is capped at 35 grand, that Roth conversion wouldn't have a specific dollar limit. Now the catch here, you would owe income taxes on the amount that you convert. But think about it, since most 18 year olds are in a pretty low tax bracket, that could mean converting at a super low tax rate, assuming that conversion itself doesn't bump them up too high. Again, I told you we're going to get this is the part I said we're going to get nerdy. Stick with me and if you don't care about that, it's okay. Move along. Now that said, you should not use a Trump account as the only way to save your kids future. Especially since your primary goal should be saving for their education so they can avoid student loans. And truthfully, there are other investing options that have better benefits. For starters, I'm a huge fan of 529 plans. Not only do they grow tax free, but you can also withdraw the money tax free for qualified education expenses in that definition has gotten a lot more flexible and broad over these last few years. And this is a huge advantage over the Trump account where you pay taxes on the money when you take it out. Now you can also invest more into a 529 and you have more investing options. And you can also roll up to $35,000 from a 529 into a Roth IRA over time if you don't end up needing all that money for education. Another option is once your kid starts working or has earned income, you can open a custodial Roth IRA for them. And I love this one because the money grows tax free and they can take the money out in retirement completely tax free. Now if you want flexibility or real investment control, here's my third favorite option. A simple brokerage account in the parent's name. Now here's why I like this one. I like the control aspect because it is straight up dangerous to just give a child access to an account with $200,000 the day they turn 18. I don't know about you, but my prefrontal cortex wasn't all there when I was 18 and there's a chance they could blow that money. So I like having control with a brokerage account. Then I can decide when to give and how much to give to my child. Now listen parents, I know you want to make sure your kids are set up for Success. But you need to prioritize saving for your own retirement first. This is the whole put on your own mask on first before helping other scenario. Because if you don't take care of your retirement, guess who's going to have to take care of you? Braxley. And that is not fair to him. So if you're debt free and you have a fully funded emergency fund in place, focus on investing 15% of your household income toward your retirement. That should be your priority. Then you can focus on investing for your kids with any money beyond that. So overall, Trump accounts are not a bad idea, but they're also not a miracle worker. They're not the best way to invest for your kids for all scenarios. Now, what I love about Trump accounts is that has really brought a conversation to the forefront that you can and should be building wealth for your children. And it doesn't take much because they have so much time on their side for compound growth to do its thing. You saw in that example, just 1000 bucks untouched left alone for 60 plus years could grow to half a million or even a million plus later on in retirement. So it doesn't take a lot. And when you got time on your side. All right, guys, we did it. And I know you've been waiting with bated breath for me to open this Pokemon pack and now is the time. So here I've got the Mega Evolution Ascended Heroes pack. As you can see, it has not been altered. I could be a magician. Let's crack this bad boy open. Crack it. Are these childproof? What is this? Pain medication. Why is it so hard to get into? Oh. Ah. I got a Team Rockets Murkrow. HP 80. That sucks. Togepi. Togepi. Little egg fella. We got a Grubbin. Looks like two Rocket. Looks like bullets coming out of his face. That's scary. We got a reboot, which I assume is a nickname for Rabbit. Little reboot got a low sweep and combustion are his special moves. Then we got the. The glass trier. Is that what I say? Glass trier. Real scary. Ice shot and Frosty Typhoon. Sounds like a great cocktail. Also not a great card. It says basic, right? That's how you know it's not a good card. Then we got a stage one. Raichu. This is. This is a pretty hot card. Everybody knows that because it has Pikachu vibes. It's got a lightning bolt, it's quick blow and strong volt are the special moves. Then we got Acerola's Mischief. That sounds like something you get after eating some bad Mexican food. Not a bad card. It's a trainer card. It's a supporter card, as they say. Oh, boy, oh, boy. Guys, we are getting into some holographics. Read it and weep. This one I'm reselling for sure. The old Pancham Reckless Charge card. Not a bad one. I'm going to put this one aside. Then we got the Beautifly. Also not a bad card. Again, I like the holographics. Very, very tasteful. The old stun spore and energy straw. And the old Spy dops. That's Team Rocket Spy Dops to you. Charging up in Rocket Rush. That's not a bad one. All right, it was a rough pack, guys. This last card is some gold Mega Dragonite Ex. That sucks. No. God, please, no. No. Why do I even do this? It's such a waste of time. Like, I spent good money on this package, all to get nothing. Nothing. Might as well auction these off for charity. Yay. Uh, not you, charity. I meant the less fortunate. But hey, at least I got Acerola's mischief. That's something to write home about. Gosh. All right, that was fun. Hope you guys enjoyed that. Uh, if you want me to sign any of those cards to make them worth even less, let me know in the comments. I'll ship them out. You pay shipping. That's on you, bro. That was a good time. Hope you guys learned a lot about trump accounts. And my knowledge of Pokemon. Both very, very impressive. And if you want to know the best way to invest for your own self, I broke it down in this video, which you can watch next by clicking here or using the link in the description. That's it for today. Thank you for watching. We'll see you in the next one.
