Source: Fortune
Summary
The Trump Accounts app promises significant returns on investment for children’s savings, but financial experts caution that the projections are based on a 10% annual return assumption, which may not be sustainable. Using a more conservative 7% return assumption, experts estimate that a maxed-out account could grow to around $185,000 by age 18 and over $1 million by age 45. However, they emphasize that the actual value of the account depends on various factors, including market performance and tax treatment.
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The numbers tell one story.
The Trump Accounts app’s projections are based on a 10% annual return assumption, which may not be realistic. Financial experts estimate that a maxed-out account could grow to around $185,000 by age 18 and over $1 million by age 45, but caution that the actual value depends on various factors. The account’s value is heavily influenced by time, with over 90% of the account’s eventual value coming from decades of compounding. Education on the money and its value is crucial to ensure that the account is used wisely.
The real engine isn’t the deposits—it’s time.
Author: Evan Null
