NEW YORK (AP) — Billionaires Michael and Susan Dell on Tuesday pledged $6.25 billion to provide an incentive for 25 million American children under 10 to claim new investment accounts created for children as part of President Donald Trump’s plan. tax and spending legislation.
Historical gift has few precedents several single charitable commitments over $1 billion in the last 25 years, much less billions of dollars. Date announced GivingTuesdayThe Dells believe this is the largest private commitment ever made to American children.
It is also unusual for it to operate through investment accounts established by the U.S. Treasury Department and to be managed by private companies. dubbed Trump Accounts, The program hasn’t started yet, but it became law on July 4th. president’s signature legislation.
“We believe that if every child sees a future worth saving, this program will build something much bigger than a calculation. It will build hope, opportunity and prosperity for generations to come,” he said. Michael DellHe is the founder and CEO of Dell Technologies, with an estimated net worth of $148 billion, according to Forbes.
Through their gift, the Dells will deposit $250 into each qualifying child’s investment account, which the Treasury plans to launch on July 4, 2026, they said. Dell said they wanted to mark this year. 250th anniversary Independence of the USA.
“We want these children to know that not only their families care about them, but also their communities, their government and their country,” said Susan Dell. “And we’re all supporting them to have a great future, a bright future, and that’s possible for them.”
Under the new law, the Treasury will deposit $1,000 into the accounts of children born between January 1, 2025 and December 31, 2028, and these funds will have to be invested in an index fund that tracks the overall stock market. However, it will be up to the families of the other children to fund the accounts. When children turn 18, they can withdraw money to spend on their education, buying a house or starting a business.
The Dells hope their gift will encourage families to buy accounts and put more money into them, even small amounts, so that over time it grows with the stock market. They also hope companies and other philanthropists will donate to these accounts.
“It’s hard to give effective dollars, especially to the nation’s neediest children, in a way that you have confidence that those dollars will combine with the positive trajectory of the U.S. economy,” said venture capitalist Brad Gerstner, who advocated for this legislation. he said. “And this is a unique platform created by the government that I think can unlock major donations.”
Gerstner is also the founder of the Invest America Charitable Foundation, which supports the Treasury in opening accounts. The purpose of the accounts, he said, is to provide young people with funds to jump-start their lives while also helping them benefit from the growth of the U.S. economy by investing in stocks.
Gerstner said of the calculations: “Fundamentally, we need to get everyone involved in the good side of the American experiment. Otherwise it’s not going to last. And so, in essence, we think this can restore people’s faith in the free market, in capitalist democracy.”
About 58% of US households Holding stocks or bonds in 2022, according to the U.S. Securities and Exchange Commission richest 1% That same year it owned nearly half the value of the shares, and the bottom 50% held shares of about 1% of stocks.
About 13% of children and teens in the United States were living in poverty by 2024, according to the Annie E. Casey Foundation, and experts attribute high child poverty rates to a lack of social supports such as paid parental leave for new parents.
Dells will deposit funds into the accounts of children living in zip codes with median family incomes of $150,000 or less.
While funds in Trump Accounts may help young adults whose families or employers can contribute to them over time, they won’t immediately help reduce childhood poverty. Cuts up to: Medical aid, food stamps and child care These expenses included in the spending package will likely reduce the support children from low-income families receive.
Aspen Institute and St. Ray Boshara, a senior policy adviser at Washington University in St. Louis, said he was excited by the idea that Trump Accounts could draw contributions from the business, philanthropic and public sectors.
“We want to see this idea, like any great policy, continue and get better over time,” said Boshara, co-editor of “The Future of Building Wealth.” “The ACA, Social Security — they start out pretty flawed, but over time they get much better, more progressive, and more inclusive. That’s how we feel about the Trump Accounts, too. It’s a down payment on a big idea that deserves to be improved, and there’s bipartisan interest in improving them.”
The Dells reported donating $2.9 billion through the Michael & Susan Dell Foundation since 1999, with a strong emphasis on education.
Michael Dell said they didn’t initially intend to make that much of a commitment to increase their child investment accounts, but Susan Dell said they decided to increase the size of their commitment over time.
“We’re excited to pioneer this in the philanthropic sector, and we’re so excited because we know more people will get involved because we really can’t think of a better idea and a better way to help America’s children,” he said.
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