Are your clients planning on having children? Tell them to hurry it up.

Inside the Trump administration’s key $4 trillion tax bill is a proposed idea to open accounts for each new baby born in the US until 2028. The so-called ‘Trump Accounts’ are seeded with $1,000 that gets invested in equities and locked up until the child’s 18th birthday. Parents can also contribute up to $5,000 annually. Previously called MAGA accounts, the funds are designed to help parents prepare for their children’s financial futures. But, what do advisors think about the proposed accounts?

“They are stupid,” said Catherine Valega, an advisor with Green Bee Advisory, adding that the wealthy have plenty of options to save, while the less affluent won’t be able to afford additional contributions.

Hit Me, Baby, One More Time

The idea of funding accounts for newly born children is nothing new. In fact, before the current administration, the accounts were called “Baby Bonds” and have been floated by politicians on both sides of the aisle. Well-known financial advisor Ric Edelman has been a prominent supporter of the idea, and even started a trust product with annuities for babies in 1999. But today, most advisors said the proposed Trump accounts will largely benefit upper-class families who can afford to contribute annually.

“The real advantage will go to families with enough disposable income to consistently fund the account,” said Edzai Chimedza, a CFP and advisor at Tobias Financial, adding that it’s an attractive tool for upper-middle-class and affluent families, who are more likely to be able to contribute after covering essentials, like retirement savings and emergency funds.

The accounts aren’t the only savings options out there, either. Who can forget those 529 plans that have grown significantly more flexible over the years and are a great option to save for college, Valega asked. A guardian Roth IRA can also help children jump-start their retirement savings, while helping them get up to speed with the stock market.

Baby Got Tax. For families that can pitch funds into the accounts, it makes sense to stop and think about a client’s intentions, said Sarah Avila, an advisor with VLP Financial Advisors. “If you are eligible to open the account for your baby, it is worth it to get the free $1,000 from the government,” she said. But clients should be aware that earnings on qualified withdrawals will be taxed at long-term capital gains rates. “If the idea is to save for college, contributing to a 529 plan is more advantageous, from a tax perspective, because the money is tax free,” she said.

Investors want more than just a bit of bitcoin.

Spot Bitcoin ETFs amassed inflows of nearly $9.6 billion from April 21 through May 27, according to data compiled by Morningstar Direct. With the price of the world’s most popular cryptocurrency reaching all-time highs of more than $100,000 lately and the Trump administration championing digital assets, advisors might now want to expand their focus beyond just bitcoin.

“The capitalization of the crypto space right now is more than $3 trillion. How can you ignore that?” said Campbell Harvey, Duke University professor and partner at Research Affiliates. “It’d be like ignoring a couple of companies in the Magnificent Seven.”

Bitcoin Blinders

While spot Bitcoin ETFs have been seeing plenty of momentum lately, iShares Bitcoin Trust ETF (IBIT) is the real winner. Over roughly the past five weeks, IBIT has taken in $8.7 billion, per Morningstar. That’s about 80% of its total inflows year-to-date. Bitcoin and ETFs that track it may be a new corner of portfolios, but advisors are quickly growing more comfortable with it. “Most of my clients have a 5-10% allocation to Bitcoin,” said Mike Casey, founder of AE Advisors. “Some are allocated significantly higher.”

Bitcoin and IBIT are clearly the biggest players in the space, but advisors should have a wider view when considering crypto allocations, Harvey said, recommending wealth managers consider stablecoins — digital currencies pegged to traditional assets like the US dollar or gold. “In my vision of the future, almost all assets will be tokenized — stocks, debts, mortgages, all this stuff,” he told Advisor Upside. “We’re going in that direction, and stablecoins are the first step.”

But of course, stay away from meme coins. “They have no fundamental value whatsoever,” Harvey said. “They’re like trading cards.”

Golden Hour. Amidst the current economic uncertainty, some have begun viewing Bitcoin as a safe haven similar to gold, but that’s still debated territory, given that their volatility profiles are drastically different, said Joy Yang, head of product management at MarketVector Indexes. “Gold is more of a slow and steady type of asset and has been quietly outperforming US equities over the past 20 years,” she told Advisor Upside. “Bitcoin has done it, too, but in a much more rollercoaster type of movement.”

In the same five-week span, Gold ETFs have experienced almost $2.8 billion in outflows, with State Street’s SPDR Gold Shares (GLD) accounting for nearly all of that, according to Morningstar. The precious metal’s price per ounce is down from an all-time high of $3,500 in late April. However, gold is still outperforming Bitcoin, up 28% YTD compared with Bitcoin’s 12% as of Monday.

“Bitcoin is still a teenager,” Yang said. “It’ll eventually be an adult, but it’s going to take a winding path to get there.”

Look how you’ve grown.

The RIA industry has expanded tremendously over the past 25 years, with headcounts, client numbers, and assets hitting record highs in 2024, according to the latest snapshot report from trade group Investment Adviser Association. Last year, nearly 16,000 firms managed $145 trillion in assets. Since the report was first published in 2000, the number of firms has more than doubled, and total assets under management in the US have grown seven times as much, per the report. The number of non-clerical workers — half of whom provide investment advice — have increased to a record of more than 1 million, up from 766,000 in 2009.

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