@RedTagAlan From the website:
What will the money be invested in?
Funds will be invested in a diversified portfolio of low-cost index funds designed to maximize long-term growth while minimizing risk.
https://www.trumpaccounts.gov
In other words, they aren't freely 'giving' $1000. These are IRAs so there are limits on when they can be touched prior to age 59 without taxes or penalties.
They* are investing the money in the stock market in their chosen funds (focusing on 'American Companies) 'for' the child, with all the risk (and benefit) that entails. Parents are of course 'encouraged' to add money to the account but it's not mandatory. I think but am not sure that at some point the parents can transfer the money into an 'approved institution'. Whether they can transfer it into an IRA savings account or if they have to leave it in some kind of market-based investment account I have no idea.
*The 'trustees' for the fund will be selected by the Dept of Treasury. No idea who they are. This is all set to 'go live' in mid-2026.
ETA: The child must be a US citizen to qualify for the 'seed money'. "All U.S. children under 18 with a valid Social Security Number are eligible to establish a Trump Account. Parents or legal guardians can open and manage accounts on behalf of their children" <qualifying dates: born between January 1, 2025 and December 31, 2028>
There is no bar to a non-citizen parent opening this type of account for a US born child. That should be interesting.
Edited