Two Ways to Save Money for your Kids

Based on member feedback, we’re here to help break down the new 530A accounts (also called “Trump Accounts”) that are rolling out July 4th, 2026. While you may have read about these accounts in the news, many parents are asking the same questions: Does my child need one? And how are they different from a 529 college savings account?

Bottom line: Both accounts can help you save for a child, and both let your money grow over time. But they are built for different goals and work in different ways. Here is a simple look at each one so you can see how they compare.

What Is a 529 Plan?

A 529 plan is a dedicated education savings account designed to help families set aside money for education expenses. It is commonly used for college savings, but it can also support other eligible education pathways. In many cases, investment earnings in a 529 can grow without annual taxation while the money remains in the account. You can read more about 529s in SSA’s blog post “College Savings, Explained.”

What Is a 503A (“Trump Account”)?

A 530A (commonly called a Trump Account) is a newer kind of savings account. It works more like a retirement account for your child. The big perk right now is the free start: if your child is born between January 1, 2025 and December 31, 2028 and is a U.S. citizen with a Social Security number, the government will contribute $1,000 to start the account.

After that, family members can add up to $5,000 each year per child and some employers may add money too. Your child cannot take the money out until they turn 18. When they do, they may owe taxes on what they take out. The money can be used for big life steps like college, a first home, or starting a business.

Trump accounts are set to roll out on July 4, 2026.

A Side-by-Side Look

*529 state by state contribution rules: https://www.savingforcollege.com/article/maximum-529-plan-contribution-limits-by-state

Which one is right for you and your child?

Here is the good news: you do not have to choose just one. In fact, these accounts can work well side by side, and many families may decide to use both.

Think of them as two tools that do different jobs. A 529 plan is a strong way to save for school, since you do not pay taxes on the money when it is used for education. A 530A gives your child a head start that can keep growing for many years, plus the free $1,000 to get going if your child is born between 2025 and 2028. These can be paired with other savings or checking accounts that your child may use or contribute to over time.

So the question is not really "which one?" It is "how can I support my child's future in more than one way?" The most important step is just to begin. Even a small amount saved today can grow into something big by the time your child is all grown up.

Note: The rules for Trump Accounts are still being finalized, so some details may change before they open. It is a good idea to check with your financial institution or a financial advisor before you open any account. Current IRS rules around Trump Accounts are here.