Transcript
Speaker: Everyone dreams of living an uncommon life and the best asset you have to achieve your dreams is you. Welcome to the Uncommon Wealth Podcast.
Speaker: We're going to introduce you to people who are living uncommonly. We're also going to give you some tools and strategies for building wealth and for pursuing an uncommon path that is uniquely right for you.
Speaker: Hello and welcome everybody to another episode of the Uncommon Wealth Podcast. I'm your host, Philip Ramsey. And with me, I have the one and only... Cody Kowalski. He makes me introduce him that way. Every time. The one and only. Not true He says many other things that get caught out of the video. Okay, today we're going to talk about something that was in your newsletter.
Speaker: People were just just... They were just pinging us. Clamoring. My phone, like I tried to hang with my wife on the weekend. I was like, oh my gosh. Couldn't it. You couldn't do it. Because people were just wanting to know more and more about Trump accounts. So here we are. We're talking about him getting free money.
Speaker: I feel like Trump is just doing this. Yes, but he won't do that for everybody. Just little. Yes, and rising interest rates. That's right. So he's trying to do something. i want to talk about why. Yeah, you think he's doing this, but has nothing to do with your notes. So we'll talk about that later. Okay, let's first talk about what is a Trump account? Why should you pay attention to this? Yeah, and who you should send this podcast to if you don't have little kids?
Speaker: Boom. Okay, so it's for children and it's specifically for saving for retirement. It's not used for education. It's not for just like do it your all, pull from it whenever you want in life. It is for retirement.
Speaker: yeah That's right. And one of the things i'll tell I'll throw in this little Warren Buffett quote, the biggest thing and the reason why he said he's successful is time. That's all it is. And so that's the huge deal with this. That's why Trump wants it. That's why they did it because they threw out, you know, if a child gets this benefit, which we're going talk about, going to be thousand dollars. And if they get a benefit when they're a newborn, what does that become at age 60? Kind of a big deal. Kind of a big deal. so Kind of a lot of money. Alright, definition.
Speaker: Do you have like a specific definition of a Trump account? I mean, it's it's an account. It's for children who are saving for retirement. It is an account. It's a good start. There's tax-free growth. You're able to contribute up to $5,000 a year into the account. And specifically, the only investments inside of the account are low-cost index funds, which we like. Which we like, yeah. We love that. Yep. Now, do you get a deduction for putting the $5,000 in? You do not.
Speaker: you No deduction. It's not like your traditional IRA. So there's that. There's no deduction. Okay. So what are the benefits other than just saving for that kid's retirement? Okay. So the biggest benefits is the free money that you can potentially get access to. And so there's two different ways or two different people who are willing to potentially give you money. The first is the government. They are willing to give you a thousand dollar benefit if your child is born between January 1st of 2025 and December 31st of 2028.
Speaker: So if you're thinking about planning a family. This is for you. This is for you. If you know someone who just had a child. or Or thinking about having a child.
Speaker: They could benefit it. That's right. Or second, the second benefit is a $250 charitable benefit. And this is a broader range. This is people who are born anywhere between January 1st of 2016 and December 31st of 2024. And we have to thank our good friends, Michael and Susan Dell for this great philanthropic phil philanthropic Okay, okay. um But- So this is like a specific family that has done this. Yes, they've they've done this, but the key with this one is that they gave $6.25 billion, dollars but you can only gain this benefit as long as that that amount of money is still there. Oh, so once that's gone, it's gone. It's gone.
Speaker: Okay, but they can get $250 for their specific retirement account. Yeah, the child's retirement account. Out of that account, that's correct. yeahp And some other things to note, that account still needs to be in place. It it couldn't have got sucked dry yet. And second, the the the qualifying dependent has to live in a zip code where the median income is $150,000 or less. Okay. So that's a key note because they want to support lower income areas. Okay. Yeah. So one other quick note is that the account opener, they have to be able to claim the child as a qualified dependent. And so if you're a grandparent, you're listening to this, you, if you can't claim the child as a dependent, you would need the,
Speaker: parent to do that open the account, but then you can help fund the account in excess if you wanted to give up to the $5,000 a year total. Yeah. That's good. How do you open it? How do open that one? Trump account. Yeah. The Trump account app. They went as simple as you could. They want you to open and download the Trump account app. It's through Fidelity as the custodian. And then you can do it some other ways, but by far this is the easiest. You open and download the app and then you fill out form 4547 and then boom, there it is.
Speaker: Okay, what if the kid wants to cash this baby out? Okay, so like we kind of discussed earlier, it turns into an IRA at 18. Okay, so then you get penalty. you get penalized. And then tax is ordinary income. Exactly. Okay.
Speaker: There you go. So now you know. And so right now it's only custodian at Robinhood. They're branching it out to more as we speak. I think Charles Schwab and Fidelity have just started getting on this. And you can't have an advisor...
Speaker: Advising that it's just now. It's yeah just so fresh. It's so fresh and so fresh and so but to conclude the benefits the biggest one is a free benefit if you have or know a child who is born either January 1st of 2025 to December 31st of 2028 or January 1st of 2016 to 20, whatever those numbers, you get it, Google it. But if you have a child who's that young. You see what I have to deal with? Yeah. He just kind of gets to some point. He just, like he just gets to a point. Just Google it. he Just figure it out from here. yeah Oh well. Yeah. Oh bummer. We're good. We're good. You either get a thousand or $250. Or, and it's a good account for saving for retirement. Yeah. But here's what I'm going to ask you. Why?
Speaker: And what do you think it could grow to? oh Come on, Cody. Here we go. Google it. so why why use this? Okay, we'll do why. Why why do you think Trump had this in place?
Speaker: What do you think he was trying to like circumvent? Well... I think Social Security. I think it's like... I don't know. That's my conspiracy theory. That he thought maybe there was something going on there. So for these younger kids, like throwing this and then... yeah What do you think it's going to grow to?
Speaker: Well, I mean, I think... What it's going to grow to? Oh, man. When there's 65, let's say. How can we not have done the math? Oh. there's this is That's your deal, man. It's probably like one point. No. One one million? inc You think? You think $1,000? $800,000. Should we do it? Yeah, let's do it. Let's do it right now. In the meantime, this is kind of how Cody and I's relationship is. I think of something and then he has to do the hard work to get it done. He's like, go do this. If he doesn't want to do it, he throws out, just Google it.
Speaker: And then I have to do that. Or AI that and see what happens. 1,000, 10%. The child is, let's give it to 65. Yeah. No additions. No additions. And monthly compounding. I don't think it's 800,000. don't think it's 800,000. I'll tell that right now. What do you think it is?
Speaker: I think it's 423,000. 423, okay, we're gonna see who's gonna be close here because I said 800, said... The answer feel like we both win. We both are it's Right rules, i win thank you. You've gone over. won want wa walk ah Trump accounts, everyone.
Speaker: Hope you enjoyed this one. I did. and That was a good one. Had to take a couple deleted scenes out because Cody wasn't ready, but we got it. That's good. all right. Thank you for listening. Again, Trump accounts. you have any questions on them, you can Google it or you can send us ah a message and be happy to answer those. Sounds good. Thanks, guys. Appreciate you That's all for this episode brought to you by Uncommon Wealth Partners.
Speaker: Be sure to visit UncommonWealth.com to learn more about our services. Don't miss an episode as we introduce you to inspiring people who are actively pursuing an uncommon life.
