Treasury says Trump Accounts auto-enrolled more than 60 million children

The Big Picture

More than 60 million children have been automatically enrolled in Trump Accounts, the Treasury Department said in an announcement reported by CNBC.

The enrollment figure signals the broad initial reach of the program's account-creation system. But the Treasury's process makes an important distinction between an account being automatically created and a family taking ownership of it. Parents and guardians must claim an account before an eligible child can receive the Treasury Department's one-time $1,000 seed contribution or accept contributions from family members, friends and employers.

That means many families will need to take additional steps before money can be deposited into an account or before they can access the program's available funding opportunities.

What Happened

Treasury regulations published Tuesday said automatic enrollment alone will not trigger the $1,000 government pilot contribution, CNBC reported. The federal contribution is available only after a family claims an account for an eligible child.

According to Treasury instructions reported by CNBC, a parent or guardian should download the Trump Accounts app, verify their identity and their relationship to the child, review the account information and accept the account terms. Those steps are required to claim the account.

The rules also require accounts to be claimed before they can receive contributions from family members, friends or employers, according to CNBC. The automatic creation of an account therefore does not eliminate the role families play in activating its funding options.

Why It Matters

The distinction could be consequential for households expecting a federal deposit after hearing that children have been automatically enrolled. The Treasury's announcement concerns the establishment of accounts, not the automatic distribution of the $1,000 contribution.

Madeline Brown, a senior policy associate at the Urban Institute, told CNBC that the rulemaking creates automatic accounts for every child under 18 with a Social Security number. Brown said the system could help ensure children do not miss philanthropic gifts or investment growth on those gifts even when an account has not yet been activated by a family.

But Brown also said families will still need to claim their children's accounts, and that details about how the process will work remain limited.

Background

Besides the potential Treasury seed contribution, additional private funding has been pledged for some children. Tech executive Michael Dell and his wife, Susan Dell, committed $6.25 billion to provide an additional $250 for children born from 2016 through 2024 who live in ZIP codes with median incomes of $150,000 or less, CNBC reported.

Those funds are aimed at lower-income children, according to CNBC. Brown cited the Dell commitment as an example of a philanthropic gift that could reach children through the automatic-account structure, even if an account has not been activated.

The available funding sources have different eligibility conditions. Treasury's $1,000 contribution is described as a one-time government pilot contribution for eligible children, while the Dell commitment is tied to birth years and ZIP code income levels. Families will need to determine whether their children meet the relevant requirements.

What Happens Next

For parents and guardians, the immediate next step is to claim an account through the Trump Accounts app, following the Treasury's identity, relationship-verification and terms-acceptance process. Claiming is necessary for eligible children to receive the federal seed money and for accounts to accept contributions from relatives, friends and employers.

The Treasury Department's announcement establishes the scale of automatic enrollment, but it does not mean every enrolled child has received a government deposit. Families seeking available funding must still complete the claims process.