But free money doesn’t necessarily mean parents should be dipping into their own savings. Personal finance expert Suze Orman says families should accept the government’s $1,000 contribution and any money their employer offers, but hold off on contributing their own cash until their finances are in good shape.
“You should never turn down free money,” Orman wrote in an August blog post titled Who Should and Shouldn’t Open a Trump Account*.*
But she had a warning for parents considering adding their own money: “Until your financial life is in great shape, I don’t want you to contribute to a Trump Account for a child. Period.”
Can you pass Orman’s test?
Before parents or grandparents put any of their own money into a Trump Account, Orman says there are five financial boxes they should be able to check off.
According to Orman, parents should hold off on contributing if they:
- Don’t have enough emergency savings to cover at least eight months of living expenses.
- Have outstanding credit card debt.
- Are still paying off student loans.
- Have an outstanding car loan.
- Are falling behind on their own retirement savings.
“You owe your child the security of knowing they will not need to step in and support you 20, 30, 40 years from now,” she wrote.
For many Americans, checking off all five boxes might be easier said than done. Household debt reached nearly $18.8 trillion in the second quarter of 2026, according to the Federal Reserve Bank of New York, including $1.26 trillion in credit card balances and another $1.71 trillion in auto loans.
Even if a family can afford to set aside a little extra money each month, Orman believes getting their own finances in order should come first.
Orman says a Roth IRA might be the better option
For parents who are financially secure and still want to invest in their children’s future, Orman suggests considering a Roth IRA instead.
Trump Accounts allow up to $5,000 in annual contributions, including up to $2,500 from an employer. But unlike a Roth IRA, where qualified investment earnings can be withdrawn tax-free, earnings from personal contributions to a Trump Account are generally taxed as ordinary income when withdrawn, according to the IRS.
