President Trump brags about Republican tax cuts
President Donald Trump touted the gains from Republican tax cuts in his 2026 State of the Union address.
President Donald Trump announced plans to roll out a new type of retirement system in his February 24 State of the Union address, highlighting the Trump Account, two initiatives aimed at helping Americans save.
“Trump Account” refers to a federal savings program for American children under 18 that is scheduled to begin on July 5 of this year. He also proposed creating a new retirement account for Americans who don’t have access to an employer match. White House officials said the account would be similar to the Thrift Savings Plan offered to federal employees.
President Trump said, “My administration will give America’s often forgotten workers, our great people, the people who built this country, access to the same kind of retirement benefits that are available to all federal employees.” “We will donate up to $1,000 each year to ensure all Americans benefit from the rise of the stock market.”
He also promised to “always protect” Social Security, Medicare and Medicaid.
What are President Trump’s plans for new retirement accounts?
Trump’s proposal for a new type of retirement benefit can be traced back to a 2021 white paper written by New School labor economist Teresa Ghilarducci and current National Economic Council Director Kevin Hassett.
The paper said evidence suggests that if retirement plans like the Thrift Savings Plan, combined with government matching, were made available to all Americans, low- and moderate-income households would generate “significantly more economic wealth” over time.
“We have a huge wealth inequality problem, and that actually means we have huge disparities in financial security,” Ghilarducci said. “This is a good step towards actually raising the bottom and getting everyone involved in building wealth, which is basically building security.”
According to AARP, nearly half of the U.S. civilian workforce, or about 56 million Americans, work for employers that do not offer traditional pension or retirement savings plans. Matched donations for all of them can add up quickly.
Fortunately, White House officials said, the existing “Saver’s Match” enacted under the Secure 2.0 Act of 2022, scheduled to go into effect in 2027 and replacing the Saver’s Credit that taxpayers can currently claim on their annual returns, could provide a path to an annual match of up to $1,000. Future legislation, specifically the Americans Retirement Savings Act, could help strengthen this plan, but the White House believes it can leverage existing executive authority to largely implement this plan.
Ghilarducci said Congress has already enacted the Sabers Match as a mandatory expenditure, meaning it is not subject to discretionary spending decisions. Replacing the Saver’s Credit with the Saver’s Match is expected to expand benefits, especially for low-income workers who pay little or no federal income taxes, but it also means the U.S. budget deficit will likely widen, he added.
Although his administration is still working out the details, he expects joining the new retirement plan will be as simple as checking a box on a tax return.
“All low-income workers, even young people, know they should save for retirement,” she added. “It’s just not encouraged. It’s not easy. It’s not automatic. … The Trump executive order just removed a lot of those administrative barriers.”
Are Americans saving for retirement?
Not enough.
The typical working-age American has $955 in retirement savings, and nearly half of households have no retirement savings at all, according to the National Institute for Retirement Security’s State of America’s Retirement 2026 report.
“Many of our retirement systems were created in the 1970s, so any changes or modernization would be very welcome,” said Miklos Ringbauer, a certified public accountant in Los Angeles. “The big questions are whether people want to participate, whether they can participate, and how easy or difficult it is to register.”
Dan Doonan, executive director of the institute, said Trump’s comments shined a welcome spotlight on the “serious challenges” facing many American families and noted that they were one of the few moments in the president’s speech that drew applause from both Republicans and Democrats.
“This bipartisan response reflects the gravity of the challenge and the growing recognition that strengthening Americans’ retirement security is an area where there is meaningful common ground,” Doonan said in a statement to USA TODAY.
What is a Trump account?
The president first announced the Trump Account program in June 2025, pledging to make a one-time $1,000 contribution to the savings account of every child born in the United States between 2025 and 2028 who has a Social Security number.
Any parent or legal guardian with a child under 18 can sign up for an account, but only children born during his administration are eligible to receive the $1,000 deposit. Like other retirement accounts, the money is placed in mutual funds or index funds that are tied to stock market performance.
In his speech, Trump encouraged billionaire businessman Michael Dell and his wife, philanthropist Susan Dell, who he said donated $6.25 billion to fund Trump’s account.
Several banks, financial institutions, businesses and celebrities have pledged to match the government’s $1,000 contribution, meaning participants could receive significantly more than their one-time federal deposit.
How to set up a Trump account
Parents or legal guardians interested in opening a “Trump Account” for their child can file IRS Form 4547 online at trumpaccounts.gov or along with their 2025 tax return.
The account does not require family members to contribute, but they can deposit up to $5,000 per year per account.
Contributor: Daniel De Vise, USA TODAY
Contact Rachel Barber rbarber@usatoday.com X Follow her at @rachelbarber_
