Every kid a grand

President Trump recently announced one of the most exciting policy initiatives I have ever witnessed. This is something I have long hoped would emerge from politics. This decision has the potential to enhance the financial literacy of our country and shape the future of the children in this nation.

Trump announced that for every child born after December 2024, the federal government will create a custodial account with an initial deposit of $1,000.

In my own life, I have experienced the power of investing. This was not something I was taught growing up, but I began learning about the markets after discovering my wife was pregnant with our first child. She felt the desire to become a stay-at-home mom, and I was not in a position to provide that for her. I did not have much spare time to take on a second job, but investing in the stock market seemed like a way to use my intellect to achieve an outsized return.

It took time, but after a couple of years of the market working for me, we now have an investment base that allows her to be a full-time stay-at-home mother, and I can still pursue my non-lucrative dream of being a pastor.

We started investing on behalf of our kids, and it is amazing to watch their savings grow in ways we would not otherwise be able to provide.

I say this not to brag, but to explain that I have real experience with the power of investing.

Disclaimer: I am not licensed and probably have no idea what I am talking about. Invest at your own risk and realize you can lose everything.

Let’s do some simple calculations on the power of investing, using this new policy as the foundation for the future of a fictional child.

When this child is born, the federal government will gift them $1,000. If the custodial adult adds no additional funds to the account, and we assume the money remains invested in something like the S&P 500 with a modest 7% yearly return, the child will have $3,379.93 by the time they turn 18 years old.

Not very exciting, but still a nice little gift.

Now, let’s say this gift at birth inspires parents to continue investing their own capital into their child’s account. Suppose the parents commit to adding $100 every month until the child is 18 years old. Now, after the initial investment of $1,000 and $100 a month from the child’s parents, at 18 years old, this child will have $45,471.74, assuming a 7% yearly return.

That is much more exciting.

I think this policy is great because it encourages people to think about the power of investing. It prompts people to consider their financial future. In doing so, I believe it could also increase the number of people starting their own entrepreneurial journeys and benefiting local economies.

This policy also reinforces investing in the broader economy. I have a romantic idea about investing. When you buy stock in a company, you should not do it based solely on name or brand. You should invest in companies that you believe are doing things right or companies you think deserve to succeed.

Investing, when framed in this manner, is not just another form of gambling. Instead, you are placing your stake in the global economy and essentially voting for the future of business to be a certain way.

Investing is not placing a bet. It is placing your influence, however small, on the world of capitalism and seeking to move the world in a certain direction.

The modern financial world is offering you and your children a voice in the world of global commerce. Make it count.

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