Interested in opening a Trump Account? Here’s how they work.

President Donald Trump will visit metro Atlanta on Wednesday to promote his new savings accounts available to anyone under the age of 18. The program, which went into effect July 4, was included in the One Big Beautiful Bill Act that Congress passed last year.

But who qualifies for an account and how do they work?

Here are some details of the plan.

1. Anyone under the age of 18 can open an account

The account holder must be 18 years old through the end of the year. Babies born between Jan. 1, 2025 and Dec. 31, 2028 (during Trump’s second term as president) can qualify for a $1,000 down payment from the government. For account holders born before then, family members and employers can contribute up to $5,000 a year to their accounts.

2. There are strict annual contribution limits

Parents, family members and employers can chip in to help the account grow, but those contributions are capped at $5,000 a year for now, although Bethany Whetzel, treasury programs director for the Office of the State Treasurer in Georgia, said that number will increase over time.

“That $5,000 annual contribution limit will be indexed for inflation eventually,” Whetzel said.

The initial seed money of $1,000 doesn’t count toward the cap. Employers can contribute up to $2,500 annually to an account without it counting as taxable income for the worker.

3. The money is locked until adulthood

Other than rare exceptions, funds can’t be withdrawn before the account holder turns 18. Then, standard IRA rules apply, meaning early distributions before age 59½ can trigger income taxes and a 10% penalty unless the money is used for specific purposes like higher education or first-time home-buying.

“If you took out $10,000 for a first-time home purchase … you would only pay taxes on the earnings; you would not pay the 10% penalty,” Whetzel said. “But let’s say you took (money) out because you wanted to pay for your wedding, then … you would pay taxes (on the money) and you would pay a 10% penalty.”

4. Investment options are guard-railed

You can’t use a Trump Account to trade high-risk stocks or crypto. Federal rules require funds to be invested in low-cost stock index mutual funds or exchange traded funds, which are groupings of various stocks.

“You’re not just putting all your money in one stock,” Whetzel said. “You’re spreading the risk around multiple options.”

The Trump Accounts website claims an account holder who invests the initial $1,000 and nothing else would have $6,000 by age 18. The site claims that same person would have $15,000 by the age of 27 and $243,000 by the age of 55.

5. They are similar to and different from 529 plans

Both accounts can be used for higher education expenses, such as paying for college tuition. However, Trump Accounts can’t be accessed before the account holder turns 18. 529s can be used for K-12 education expenses, like private school tuition, education therapies and tutoring fees. There’s no yearly contribution cap for 529 plans, although Georgia has set the total account contribution limit to $550,000.

Whetzel said the two plans also have different income tax rules.