New York — Billionaires Michael and Susan Dell pledged $6.25 billion on Tuesday to provide an incentive for 25 million American children under the age of 10 to claim new children’s investment accounts created as part of President Donald Trump’s plan. Tax and spending legislation.
The historical gift has little precedent, however A few single charitable commitments In the past 25 years it has exceeded a billion dollars, not to mention several billion dollars. Advertise on Giving TuesdayThe Dells believe this is the largest private commitment ever made to the children of the United States.
It is also unusual that it will operate through investment accounts set up by the US Treasury that will be managed by private companies. Dubbed ” trump accounts, The program has not yet been launched but was passed into law on July 4 as part of Legislation signed by the President.
“We believe that if every child can see a future worth saving for, this program will build something far greater than just an account. It will build hope, opportunity and prosperity for generations to come,” he said. Michael Dellfounder and CEO of Dell Technologies, has an estimated net worth of $148 billion, according to Forbes.
With their gift, the Dells will deposit $250 into an investment account for each qualifying child, which they said the Treasury Department plans to launch on July 4, 2026. Dell said it wants to celebrate the gift 250th anniversary for the independence of the United States.
“We want these children to know that not only do their families care about them, but their communities, their government and their country care about them,” said Susan Dell. “And we all encourage them to have a great future, a bright future, and this is available to them.”
Under the new law, the Treasury Department will deposit $1,000 in the accounts of children born between January 1, 2025 and December 31, 2028, and the money must be invested in an index fund, which generally tracks the stock market. But it is up to the families of the other children to put money into the accounts. When children turn 18, they can withdraw money for their education, buy a house, or start a business.
The Dells hope their gift will encourage families to claim the accounts and deposit more money into them, even small amounts, so that they grow over time along with the stock market. They also hope that companies and other charitable organizations will donate to these accounts.
“It’s difficult to give effective dollars at scale, especially to the nation’s neediest children in a way that you can be confident that those dollars will compound with the upside of the American economy,” said Brad Gerstner, a venture capitalist, who advocated for the passage of this legislation. “So, this is a unique platform being created by the government that I believe can unleash significant bidding.”
Gerstner is also the founder of the Invest America charity, which supports the Treasury Department in launching the accounts. He said the goal of the accounts is to give young people money to start their lives but also help them benefit from the growth of the U.S. economy by investing in stocks.
“Fundamentally, we need to engage everyone in the positive side of the American experiment,” Gerstner said of these accounts. “Otherwise, it won’t last. And so, at its core, we believe it can revitalize people’s faith in the free market and capitalist democracy.”
on 58% of American households Hold stocks or bonds in 2022, according to the U.S. Securities and Exchange Commission, even though… richest 1% They owned nearly half the value of stocks that same year, and the bottom 50% owned approx 1% of shares.
In 2024, about 13% of children and youth in the United States were living in poverty, according to the Annie E. Casey Foundation, and experts link high rates of child poverty to a lack of social support for new parents, such as paid parental leave.
The Dells will put the money into the accounts of children living in zip codes with an average family income of $150,000 or less.
While the money in Trump’s accounts may help young people whose families or employers can contribute over time, it will not immediately help reduce child poverty. discounts for Medicaid, food stamps and child care Which is also included in the spending package is likely to reduce support received by children from low-income families.
Ray Bishara, a senior policy advisor at both the Aspen Institute and Washington University in St. Louis, said he was excited about the idea that Trump’s accounts would be able to receive contributions from the business, philanthropic and government sectors.
“We would like to see this idea continue and improve over time, just like any big policy,” said Bishara, who co-edited the book “The Future of Wealth Building.” “The Affordable Care Act and Social Security — they start out pretty flawed, but they get much better and more advanced and comprehensive over time. And that’s the way we think about Trump’s calculations. It’s a down payment on a big idea that’s worth improving, and there’s bipartisan interest in improving it.”
Through Michael & Susan Dell Foundation The Dell Foundation has announced $2.9 billion since 1999, with a major focus on education.
Michael Dell said they didn’t initially envision committing so much to boosting the children’s investment accounts, but Susan Dell said that over time, they decided to increase the size of their commitment.
“We are thrilled to be leading this philanthropic sector and are so excited because we know that more people will join us because we really can’t think of a better idea and a better way to help America’s children,” she said.
___
Associated Press coverage of philanthropy and nonprofits receives support through an AP collaboration with The Conversation US, with funding from the Lilly Endowment Inc. The AP is solely responsible for this content. For all of AP’s philanthropy coverage, visit https://apnews.com/hub/philanthropy.