Michael and Susan Dell commit $6.25 billion for investment accounts for kids

Michael and Susan Dell will donate $6.25 billion to fund investment accounts for 25 million U.S. children, under a plan unveiled Tuesday. The money from their charitable funds would help to seed "Trump Accounts" ushered into law in July.

The gift would put $250 into each eligible child's account, which is meant to grow over time through investments in low-cost stock funds that track market indexes.

"The idea is to give millions of children a head start on saving for the future," Michael Dell told NPR. "And we know that when children have accounts like this, even with modest sums, they have better outcomes in life."

Michael Dell is the CEO of Dell Technologies.

Here's a brief guide to the accounts, and the Dells' plan:

Who would receive the Dells' gift?

To receive the Dell gift, children need to have Social Security numbers and be age 10 or under and born before Jan. 1, 2025.

Dell told NPR they're trying to reach kids who need the money the most, which is why the gift targets recipients who live in ZIP codes where the median income is less than $150,000.

The Dells say the gift will reach nearly 80% of children in the eligible age group, across 75% of ZIP codes in the U.S.

Parents need to create "Trump Accounts" to receive the gift

As part of the One Big Beautiful Bill Act signed into law this past summer, every American baby born from this year through 2028 is in line to automatically receive a Trump Account funded with $1,000 from the U.S. Treasury.

All kids under 18 who have a Social Security number can have one of the accounts — but they don't get that initial $1,000.

The Dell gifts are meant to help kids who are too old to receive that Treasury payment.

"What we're doing with this gift is targeting kids that are 10 and under that aren't part of the federal program," Dell said.

Susan Dell encouraged parents to "mark their calendars for July 4, 2026, which is when they could claim the accounts for their children."

How Trump Accounts work

Money in Trump Accounts would grow over time, using contributions to invest in low-cost stock funds that track market indexes. When the children turn 18, they can either convert the money into a retirement account or use the money for education, buying a home, or starting a business.

Parents and others can contribute up to $5,000 annually until the year the child turns 18.

Personal finance experts say the Trump Accounts are sort of a hybrid of existing plans. And the potential benefits would vary widely depending on how much a family can contribute.

According to the White House, maximum contributions to a Trump Account could make it worth nearly $1.1 million by the time a beneficiary is 28 years old. If no additional contributions are made, it could be worth far less: $18,100.

Essential details about how the Trump Accounts will be administered remain unknown. A recent update from Charles Schwab stated, "At this time, it isn't clear who will open the account or where it will be held."

The investment bank recommends families consult a tax or financial adviser if they're interested in the plan.
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