Treasury Proposes Low-Cost Investment Rules for Trump Accounts

WASHINGTON, August 20, 2026 — The U.S. Department of the Treasury has proposed rules for investments held in Trump Accounts, with provisions intended to keep fees low, encourage diversification, and support long-term savings for children. The proposal would establish standards for investments that future Trump Account trustees, including rollover trustees, may designate for account holders.

The proposal follows Treasury’s earlier announcement that the State Street SPDR Portfolio S&P 500 ETF (SPYM) would be the default investment for Trump Accounts. Treasury also identified four additional low-cost index ETFs that parents or other responsible parties may choose for investment. Treasury Secretary Scott Bessent said the rules are intended to help families retain more of their investment returns by limiting unnecessary fees.

Fees Matter More Over Decades

Treasury’s proposed rules would limit eligible investments to options with low expense ratios and exclude products with excessive fees or unnecessarily complicated strategies.

The proposal also favors straightforward index investments that provide exposure to a wide group of securities. By keeping investment costs lower, more of the returns generated by the account can remain invested and potentially grow over time.

What Qualifies for a Trump Account

The proposed rules would establish requirements for investments that can qualify for Trump Accounts. An eligible index would need to be designed primarily to measure the performance of a broad segment of the U.S. or global equity market and use objective financial criteria to determine the securities or assets it tracks.

The framework would give trustees specific standards for evaluating investment options before they are designated for Trump Accounts. For families, those requirements are intended to support investment choices based on cost, diversification and long-term financial performance rather than highly specialized or costly strategies.

Image credit: Trump Accounts

Index ETFs Give Families More Choice

SPYM would serve as the default investment for Trump Accounts, while four additional low-cost index ETFs would be available for selection by a parent or other responsible party. The range of choices gives families some flexibility while keeping the available investments within the standards outlined by Treasury.

Index ETFs can provide exposure to many securities through a single fund, which can help spread investment risk across companies and sectors. The proposed framework would therefore steer account holders toward diversified funds rather than individual securities or specialized investment strategies that may carry higher fees or greater risks.

How Low Costs Can Affect Long-Term Savings

The long investment period associated with children's accounts gives fees particular importance. Money that remains invested for decades can benefit from compounding, while recurring investment expenses can reduce the amount that remains in the account to generate future returns.

Frank Bisignano, CEO of the IRS, said even small differences in annual costs can affect the amount available when a child reaches adulthood. The proposed rules would give trustees standards for selecting eligible investments while giving families access to low-cost index options designed for long-term savings.