The new Invest America “Trump Accounts” concept is really fascinating:

1. it’s great for all children; to get them skin in the game of American Capitalism
2. it provides a great opportunity for children to learn about Financial Literacy & the stock market
3. it’s particularly impactful for disadvantaged youths whose parents don’t have a stake in financial markets and who, without Invest America, are really excluded from the financial system at a broad level Brad Gerstner, Bill Gurley and Michael Dell talk about these concepts at length in a recent BG2 Pod, and what really hit me like a ton of bricks was the 3rd point above. Philanthropists now have the opportunity to contribute to Trump Accounts for all children in a given geographical area. I can imagine a future where 501(c)(3)’s are set-up to administer gifts to Trump Accounts and to administer Financial Literacy education within a school system.

Skin in the Game of Capitalism

The Trump Accounts give children skin in the game so that they are motivated to learn about Capitalism and how to succeed within our financial system. George Soros has an amazing quote that is relevant here:

👉 > “Invest first and investigate later.”

More from The Alchemy of Finance:

It worked very well because if an idea was appealing enough to attract me on first hearing, it was likely to have the same effect on others. If, on further investigation, I found it to be flawed I could always turn around and liquidate my position with a profit provided I was not the last one to hear it.

In that context, he’s really talking about professional trading; however, I think it can be extended to Financial Literacy in general. Once you are invested, you will have a natural motivation to learn more about Capitalism.

And here’s Paul Tudor Jones with a similar sentiment on Bloomberg

Here I’m the budget hawk, and I think [Invest America] is the greatest $4B we’ll ever spend. The idea of making kids stakeholders in capitalism at an early age is so important.

Massive Financial Upside

Another point Brad Gerstner makes in the BG2 Pod video is about the financial upside of being invested in the stock market at an earlier age:

If you start with $1,000 and you add $750 per year, at 18 that’s worth $50,000. At 30 that’s worth $170,000. And at 50 it’s worth $1,000,000.

Keeping George Soros’s theme of Invest First & Investigate Later, that’s a lot of motivation to learn about Capitalism.

Takeaway

We need to foster 501(c)(3)’s that facilitate the combination of financial contributions to “Trump Accounts” and Financial Literacy education within the school systems. Those two aspects together have the potential to have a massively positive impact on society as a whole.

I am going to start writing about Invest America at length. What does it mean from a Philanthropy perspective? What does it mean for Parents and Children? And how can we further the Financial Literacy side of the project? I’ll link those writings here as I develop them further.

Further Reading

1. soon