Experts Cut Trump Account Projections to $1 Million by 45, Warning 10% Return Assumptions Mislead
Updated
Updated · Fortune · Jul 12
Experts Cut Trump Account Projections to $1 Million by 45, Warning 10% Return Assumptions Mislead
1 articles · Updated · Fortune · Jul 12
Summary
$13 million projections on TrumpAccounts.gov rely on uninterrupted 10% annual S&P 500 returns for 55 years, while advisers modeling the accounts used roughly 7% and projected about $1 million by age 45 for max contributors.
A child eligible for the program gets a $1,000 Treasury seed deposit, and families can add up to $5,000 a year until 18; advisers said more than 90% of eventual value would come from decades of compounding, not the roughly $91,000 contributed.
The biggest risks are not just lower market returns but account rules: withdrawals are taxed as ordinary income, early distributions can face a 10% penalty, and the child gains full control at 18.
Planners said Trump Accounts should complement—not replace—401(k)s and 529s, with employer match funded first; the accounts are strongest for children without earned income and may work best if later converted to a Roth IRA.