U.S. Treasury Secretary Scott Bessent on Wednesday touted the benefits of the Trump administration’s new savings program for U.S. children, telling “CBS Saturday Morning” co-host Kelly O’Grady that the “Trump Accounts” could serve as “a rainy day fund” when those kids reach adulthood.
The program, created under the Republicans’ “big, beautiful bill” tax and spending law, calls for the federal government to start tax-preferred investment accounts for about 25 million children born between Jan. 1, 2025, and Dec. 31, 2028. The U.S. will seed each account with $1,000, which will be invested in the stock market.
“You got $1,000 coming from the government that’s going to be invested into an index fund,” Bessent said, adding that “even if your child doesn’t get $1,000 from the government, you can contribute …in tax free. And we’re going to have employers who are contributing.”
Philanthropists Michael and Susan Dell have pledged to contribute $250 per child to many of the new accounts, while companies including Bank of America and JPMorgan Chase announced Wednesday that they’ll also chip in $1,000 to accounts opened by the financial giants’ employees.
“So many Americans couldn’t even [handle a] $500 emergency,” Bessent told O’Grady. “So maybe people just put it away and it’s a rainy day fund. You know, it can be a component” of a bigger purchase or investment.
The accounts will remain invested for children until they turn 18, when they can tap the money to pay for qualified expenses, such as education, buying a home or starting a business.
Bessent said the accounts, which are limited to contributions of $5,000 per year per child, have drawn 600,000 signups this week alone. Families with children under 18 may also open accounts, although they won’t get the seed money from the federal government.
Closing the wealth gap?
Trump Accounts have raised some concerns that they could widen the U.S. wealth gap — which recently hit an all-time high — because higher-income families could stash the maximum of $5,000 per year in a child’s account, while lower-income households might struggle to contribute funds.
Bessent rejects such criticism, noting that the Dells’ $6.2 billion contribution won’t include the wealthiest 20% of U.S. zip codes.
“It shows how out of touch anyone who says that is, because if they say only $5,000, these are families — a huge number of families in America — wouldn’t have $500 [for] a medical emergency. So how can they say only $5,000? What the hell are they talking about? It doesn’t make any sense. It’s just because President Trump has sponsored it, they don’t agree with it.”
Bessent added that philanthropists who want to donate funds for a Trump Account can direct the money to lower-income parts of the U.S. “They can choose by zip codes. They can choose by school district. They can do it by economic quintiles,” he said.
The accounts are likely to also help educate Americans about investing, especially the 38% of households that don’t own stocks, Bessent added, noting the importance of financial literacy.
“For many Americans … Wall Street is this abstract notion,” Bessent told O’Grady. “All of a sudden they have participated for 18 years in the financial markets. So it’s a constant financial education.”
Addressing affordability
Asked about affordability issues that many Americans say they are facing, Bessent blamed the Biden administration for driving up inflation. He also credits President Trump for boosting wage growth, pushing down prescription drug costs and introducing tax cuts through the “big beautiful” bill.
“What we’re trying to do, we’re trying to control costs,” Bessent said. “I think inflation is going to be back toward the Fed target of 2%.”
Many Americans have negative views about the cost of living in the U.S., according to a December CBS News poll.
The Trump administration has introduced a flurry of proposals in recent weeks, in addition to the Trump Accounts, aimed at easing affordability pressures. They include promises to cap credit card interest rates at 10% and ban institutional investors from buying single-family homes.
Experts, however, have questioned whether these proposals will achieve their intended objectives.
Demanding Fed “accountability”
Bessent also touched on the independence of the Federal Reserve and defended the Department of Justice’s ongoing investigation into Federal Reserve Chair Jerome Powell, dismissing concerns that the probe could weaken the central bank’s traditional independence.
“I think that the message is that independence does not mean no accountability,” Bessent said. “I’ve been calling for the Fed to do an internal investigation on numerous things since last spring, and they’ve chosen not to do it.”
Earlier this month, the Justice Department served the central bank with grand jury subpoenas tied to a criminal investigation into Powell’s June 2025 testimony before a Senate committee regarding a project to renovate several Fed buildings in Washington, D.C.
Powell responded in a video message, calling the investigation a pretext for weakening the Fed’s independence in setting interest rates. Mr. Trump has already identified several candidates to replace the central bank chief when his term expires in May.
Bessent said Wednesday that the Fed must be “beyond reproach” in its dealings, characterizing it as the “most powerful, unappointed group in the U.S.”
Addressing the DOJ investigation, Bessent said the central bank should be held accountable for its actions.
“[The] president has great reverence for the Fed’s independence,” he said. “But independence does not mean no accountability.”
Alain Sherter and
Aimee Picchi
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