Through the American Dream Accounts Act (ADAA), which is in partnership with the Social Security Administration, children in the United States will soon be eligible to receive approximately $5,000 as part of a program that will enable them to accumulate savings at an early age.
The plan, which was announced by Minnesota Democrat Representative Dean Phillips, would enable the youth to establish an index fund that would be supported by compound interest and available upon high school graduation, upon earning a GED, or through a disability waiver.
Furthermore, the ADAA will continue to provide a 10% return on the $5,000, which means that beneficiaries may eventually have $25,000 to start their life by paying for college, purchasing a home, or establishing a business and family.
This would be a huge boost for young American families at a time when the economy and societal pressures are causing a fall in birth rates, home ownership, and successful marriages.
For example, two children on the program, in a relationship when they are adults, might total $50,000.
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Will the plan be launched?
The US Department of Education will also make sure that students are taught important financial topics like money management, investment, and entrepreneurship. Additionally, students will be able to monitor the progress of their portfolio through a mobile app.
Any kid born in the United States or who has become a naturalized citizen (i.e., children of immigrants or immigrants themselves) is eligible to receive $5,000 to start their lives.
