U.S. Senator Ted Cruz has introduced a new proposal this week that could reshape how Americans build wealth from birth.
The Invest America Act, unveiled by Cruz in a recent press release, and now gaining traction in the U.S. House, would set up private investment accounts for every newborn American, seeded with a $1,000 deposit from the federal government.
The accounts established for each newborn in the country could be game-changing for the future of the country’s financial stability. According to Cruz’s office, the act would leverage the power of America’s economy to offer long-term financial opportunities to all Americans, regardless of their background.
“The Invest America Act will trigger fundamental and transformative changes for the financial security and personal freedoms of American citizens for generations,” Cruz said. “Every child in America will have private investment accounts that will compound over their lives, enhancing the prosperity and economic participation of the vast majority of Americans.”
The accounts would allegedly function similarly to Roth IRAs or 529 plans but on a larger, national scale.
Every child would receive the $1,000 investment from birth, which could grow tax-deferred in a low-cost fund. Parents, family, friends, or even their employers could make additional contributions, up to $5,000 annually.
Withdrawals would be taxed at the capital gains rate after age 18, offering young adults a potential launchpad into financial independence: either for college, starting a business, home ownership, or other endeavors. A launchpad that could greatly change the outlook of young Americans amid a currently troubling housing market and skyrocketing student loan debts.
The Invest America Act reflects a conservative, yet forward-looking vision of financial empowerment: creating more owners, not more dependence.
Tech and investment heavyweights have already voiced enthusiastic support for the act.
Brad Gerstner, CEO of Altimeter Capital, called the measure a “Main Street Agenda” win.
“Invest America accounts are central to the Main Street Agenda – pulling every kid off the sidelines and putting them squarely in the game. When everyone realizes they can be an owner, it unites our country around free-market principles and unleashes the next generation of American success,” Gerstner said.
Michael Dell, founder and CEO of Dell Technologies, has also endorsed the bill, saying, “When the power of compounding meets the energy of young minds, we’re not just growing portfolios—we’re fostering the next generation of builders, dreamers, and doers who will keep America leading the world.“
With early signs of support and the bill’s inclusion in the House Ways and Means Committee’s budget package, the Invest America Act is clear to be more than a political talking point: it’s a serious financial plan for America’s future.
“When people years from now talk about the changes created by Republican efforts this Congress, this is one of the landmark achievements they will talk about,” Cruz added.