A pair of academic researchers want the Trump administration to automate “Trump accounts,” so that every baby born between 2025 and 2028 automatically receives $1,000 in retirement savings.
The Treasury Department reported on May 8 that about 6.6 million American children are enrolled in the new federal retirement savings program, and 1.4 million infants are on track to receive $1,000 contributions from the government.
Those families opted into the program before the July 4 launch by visiting the trumpaccounts.gov website or filing the new IRS Form 4547 with their 2025 tax return.
But researchers say that if enrollment had been automatic, the Trump Accounts program could have reached up to 73 million American children.
“I think it feels like a missed opportunity,” said Stephen Roll, an assistant professor at the Brown School of Washington University in St. Louis. “These accounts have the potential to be transformative in how we help people build wealth in this country.”
Roll raised the issue of automating Trump accounts in an article published May 4 in The Washington Post, co-written with fellow WashU scholar Jin Huang.
The researchers said the Treasury Department is aware of their proposal.
“The U.S. Treasury Department is committed to maximizing the impact of Trump accounts, expanding sign-ups to all eligible children, and achieving our goal of every American child having a Trump account,” the agency said in a statement.
What are ‘Trump accounts’?
The program promises to deposit $1,000 into retirement savings accounts for each child born during the four years of Donald Trump’s second presidential term: essentially an IRA for kids.
American children born before 2025 and under the age of 18 are also eligible for Trump accounts, but will not receive any initial funding from the federal government.
The program is designed to teach children about saving and investing and to encourage children and their families to build wealth for adulthood and retirement.
Critics have warned that Trump accounts could take off as expensive gifts for the rich, adopted by parents who already have substantial investments as a means of filling out their portfolios.
Previous research has shown that lower-income Americans are less likely to participate in retirement savings. For example, only half of workers with annual income between $15,000 and $30,000 participate in Vanguard 401(k) programs, compared to 95% of workers earning more than $150,000.
Madeleine Brown, a senior policy associate at the nonpartisan Urban Institute, said, “Without automatic enrollment, without ensuring that our lowest-income families open their accounts and get their thousands of dollars, there is a risk that this program becomes another tax subsidy that mostly benefits wealthier families.”
Why does auto-enrolment matter?
Automatic enrollment is widely viewed as the ideal model for retirement savings programs, as potential savers are more likely to participate if they have to make the effort to opt out.
According to AARP, twenty states have adopted Auto-IRA programs as a safety net for workers who don’t have access to retirement savings. State programs offer retirement savings to those workers with automatic enrollment.
Under federal law, starting in 2025, most new 401(k) plans were to enroll employees automatically rather than leaving the decision up to them.
In their op-ed piece, the WashU researchers cite the Alfond Grant program in Maine, which offers parents a $500 grant for newborn babies. When the program changed from optional to automatic enrollment, participation increased from 40% to 100%.
“I think that’s the important message here: We know how to do this,” said Huang, a social policy professor at the Brown School.
Based on CDC data, there are approximately 3.6 million Americans born in 2025. Of that group, 1.4 million are now registered for Trump accounts.
“So, we need to understand who the two-thirds of kids are who didn’t claim their $1,000,” said the Urban Institute’s Brown.
Why aren’t more people claiming Trump accounts?
The Trump Accounts website describes the signup process as relatively simple. You file Form 4547, a one-page document that asks for date of birth, Social Security number and other basic information. After you submit the form, the site instructs, you will be contacted with instructions on how to set up an account.
But tax forms are rarely easy, and this is new.
“It’s a new and unfamiliar thing that people may not have the knowledge to engage with,” Rolle said. “The more paperwork you burden people with, the more you stand to lose in the process.”
Some new parents may not know Trump accounts exist. Anyone filing a 2025 tax return had the opportunity to file Form 4547, but millions of low-income Americans do not file a tax return.
“The decision to tie enrollment in this program primarily to tax filing leaves out the children who would need it most,” Brown said.
Newborns aren’t the only ones who could miss out on free retirement savings.
In addition to the $1,000 federal contribution, philanthropists Michael and Susan Dell pledged $250 to each of the first 25 million Trump account applicants who are age 10 or younger, were born before 2025, and live in a ZIP code with a median income below $150,000.
Several other pledges have come from philanthropists and corporate America, potentially expanding the reach of the program.
It may seem unbelievable that anyone would give up free retirement savings. But small-value retirement accounts routinely break down, get lost or are forgotten by people who change jobs.
“Our experience in the private sector with very small accounts is that a significant percentage of the population never connects to their accounts,” said J. Spencer Williams, founder and CEO of Retirement Clearinghouse, a financial technology firm. “You end up with these types of stranded, orphaned accounts.”
It is not necessary that Trump’s accounts remain small. The program’s website estimates that a $1,000 contribution will grow to $6,000 when the newborn turns 18, even without additional contributions. By age 55, it will reach $243,000.
“We’re all paying for these accounts through tax dollars,” said Monique Morrissey, a senior economist at the Progressive Economic Policy Institute. “So, even if you don’t like the idea of a Trump account, you should take advantage of it.”