Children’s Savings and Investment Account Comparison

Trump Account, UTMA, 529, ABLE, & Roth IRA

Account Purpose and Ownership

Feature

Trump Account

UTMA

(Custodial Account)

529 Plan

ABLE Account

Custodial Roth IRA

Purpose

Retirement savings for minors General savings / investments for minors Education savings
(some retirement flexibility)
Savings for individuals with disabilities Retirement savings
(can be used for qualified purposes before retirement).

Who Can Contribute

Anyone
(parents, employers, governments, charities).
Anyone Anyone Anyone Anyone
(but must be from minor’s earned income).

Control of Funds

Parent / custodian controls pre-18. Custodian until age of majority (18 or 21). Account owner retains control. Beneficiary
controls(or authorized individual).
Custodian controls until age of majority;
then minor gains control.

 

Contribution and Income Rules

Feature

Trump Account

UTMA

(Custodial Account)

529 Plan

ABLE Account

Custodial Roth IRA

Contribution Limit

$5,000/year (indexed); $2,500 from employer; unlimited from gov/charity. No formal limit (subject to gift
tax rules).
Varies by state (often $350K–$500K+ lifetime). $20,000/year (2026); additional

if working

(ABLE to

Work Act).

$7,500/year (2026); limited to minor’s earned income.

Earned Income Required?

No No No No Yes – contributions limited to earned income.

 

Tax Treatment and Investments

Feature

Trump Account

UTMA

(Custodial Account)

529 Plan

ABLE Account

Custodial Roth IRA

Tax Treatment of Contributions

Contributions made by families are not tax‑deductible, and government pilot deposits are tax‑free but not deductible. Employer contributions may be excluded from the employee’s income under IRC §128. After-tax After-tax

(some states offer deductions)

After-tax

(some states offer deductions)

After-tax

(not deductible)

Tax Treatment of Growth

Tax-deferred (pre-18); potentially IRA rules after 18 and varying based on contribution type. Taxable annually (subject to

 kiddie tax).

Tax-free if used for qualified education expenses. Tax-free if used for qualified disability expenses. Tax-free, subject to 5-year rule and penalties for early withdrawal before age 59.5.

Investment Restrictions

Limited to low-cost U.S. equity index funds pre-18. No restrictions Limited to plan-selected investment options. Limited to plan-selected investment options. Broad range of investments (stocks, bonds, mutual funds, etc.)

 

Access and Usage

Feature

Trump Account

UTMA

(Custodial Account)

529 Plan

ABLE Account

Custodial Roth IRA

When Can Funds Be Accessed?

At age 18, but penalties/taxes apply for non-qualified withdrawals. Before age 18, funds can be rolled into another Trump account. If the individual is disabled, a full rollover into an ABLE account is permitted at age 17, subject to eligibility rules. Can be used anytime and for any purpose. Can be used anytime, but penalties/taxes apply for non-qualified withdrawals. Can be used anytime, but penalties/taxes apply for non-qualified withdrawals. Direct contributions can be withdrawn at any time without taxes or penalties. Earnings are subject to the Roth 5‑year rule and may be taxed and penalized if withdrawn before age 59½ unless an exception applies.

Usage Restrictions

Must stay in account until 18; intended for retirement but can be used without penalty for qualifying withdrawals before 59.5. Can be used for anything once child reaches majority. Must be used for qualified education expenses to retain tax advantages. Must be used for qualified disability expenses to retain tax advantages. None

Rollover Flexibility

Limited – can’t roll into standard IRA before 18; Roth conversion possible post-18. No rollover options Can rollover up to $35,000 to Roth IRA (subject to conditions). Can rollover from 529 to ABLE (up to annual limit); Trump account maybe rolled over to ABLE in its entirety the year the minor turns 17 (does not count toward annual limit). N/A

 

Impact on Benefits and Government Support

Feature

Trump Account

UTMA

(Custodial Account)

529 Plan

ABLE Account

Custodial Roth IRA

Impact on Financial Aid (FAFSA)

Expected to follow standard IRA FAFSA rules: not counted as an asset, but withdrawals count as income. Formal guidance specific to Trump Accounts is still pending. Student asset (heavily impacts aid) Parent asset

(less impact on aid)

FAFSA does not consider this an asset of the child or parent. Student asset (but retirement assets are often excluded from FAFSA calculations).

Impact on disability benefits

Pending guidance from SSA if balance is not rolled to ABLE at age 17. Counted as resource after age of majority. Excluded as resource – owned by third party. Up to $100,000 is excluded as a resource. Counted as resource after age of majority.

Government Contribution Pilot

$1,000 for kids born 2025–2028 None None None None

 

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