New Plan Would Give Babies $1,000 a Birth, Up to $2,000 a Year: Here’s How it Would Work


Democratic lawmakers in Washington are continuing to push for a plan that would give every American child $1,000 at birth with up to $2,000 a year following until they reach 18.

The bill, the American Opportunity Accounts Act, was introduced recently by Sen. Cory Booker, D-NJ, and Rep. Ayana Pressley, D-Mass. The two recently urged Treasury Department officials to throw their support behind the payments, dubbed “Baby Bonds.”

“The impact (of baby bonds) would be transformative: at a cost of approximately $60 billion annually, less than 10 percent of what we currently spend to subsidize wealth-building through the tax code, we can give every American a stake in our economy and agency over their future,” wrote Senator Booker and Representative Pressley in a letter to Treasury Department Advisory Committee on Racial Equity Chair Michael Nutter and Vice-Chair Felicia Wong.

Here’s how the plan would work:

At birth, every American child would be given an “American Opportunity Account” with $1,000 in federal funds. Each year, children would receive up to an additional $2,000 deposited into their account based on family income.

The funds would sit in a federally insured account managed by the Treasury Department, achieving roughly 3% interest. The money would become accessible at age 18 for allowable expenses like home ownership or higher education.

The value of the account would vary based on family income. For a family of four with income of less than $25,100, the account could grow to $46,215 per child; for a family of four with an income of $125,751, the account would be worth $1,681, or the total growth of the initial $1,000 payments without $2,000 yearly allotments.

Funding for the payments would come from increases to inheritance and estate taxes.

The bill has picked up a host of Democratic backers, including Sens. Dick Durbin, D-Ill., Elizabeth Warren, D-Mass., and Bernie Sanders, I-Vermont.

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  1. If the “bonds” are put into a government account to be held 18 years you will probably never see any of the funds. If they are really interested in promoting families the payments need to be given to the parents to use for their real life needs today, tomorrow and next week…..

  2. New Plan Would Give Babies $1,000 a Birth, Up to $2,000 a Year

    Now all you have to do is figure out how to get a baby to be born twice a year. So you can claim the two thousand.

    HEY! I’m not the illiterate fool who wrote that headline!

  3. LOL yes Plato that one did have me scratching my head too. But looking through the typo, I think the plan has considerable merit. Children of low income families may indeed get the step up they need to participate fully in society.

  4. OMG-
    How triggered do some get over headlines????

    Again RWR curates articles already written online, When we do this we do not alter those articles headlines or content. We link directly to the site the article was curated.

    Do some have trauma related issues from Emglish class? Perhaps humilatied by failing the spelling Bee year end and year out?

    Enough with the grammar snark.

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