Newsom urges California families to sign up for Trump Accounts in rare bipartisan moment
SAN FRANCISCO (KGO) -- Gov. Gavin Newsom is encouraging families to take advantage of a program bearing the name of one of his biggest political rivals: President Donald Trump.
Newsom, who has made his opposition to Trump a defining part of his national political profile, offered rare praise for the president on Friday as California celebrated a milestone for its own children's savings program.
"I'm enthusiastic about encouraging people to get a Trump Account," Newsom said. "I think it's incredibly important."
RELATED: Trump Accounts for kids launch: Here's who qualifies for free money, how to sign up
The governor was in San Francisco to announce that 1 million California children have now claimed CalKIDS accounts, the state's program designed to help families save for college and career training.
CalKIDS launched statewide in 2022 and provides eligible children with state-funded savings accounts. Eligible school-age children can receive up to $1,500, while eligible newborns can receive up to $175.
First Partner Jennifer Siebel Newsom said providing children with financial assets early can help put them "on a path towards a healthier financial future."
Now, California leaders are encouraging families to pair those benefits with the new federal Trump Accounts.
How are CalKIDS and Trump Accounts different?
While both programs aim to give children a financial head start, the accounts work differently.
CalKIDS funds are intended specifically for qualified education expenses, including college and career training.
Trump Accounts are federally created investment accounts available to children under 18 with Social Security numbers. Children born between 2025 and 2028 are eligible for a one-time $1,000 federal contribution.
The money is invested and can grow along with the stock market, similar to an IRA account. Families, employers and philanthropists can also make contributions.
RELATED: Trump Accounts offer free funds for some children, but advisors say they may not fit every family
Brad Gerstner, founder of Invest America and a key California advocate behind the federal program, said the two programs are designed to complement one another.
"When it comes to our kids, there's no daylight between CalKIDS and the Trump Accounts," Gerstner said.
He described the federal program as a way to give children who feel "left out and left behind by capitalism" an ownership stake in the economy.
Since Trump Accounts opened in early July, Gerstner said roughly 600,000 California families have signed up.
Newsom said he believes the president's name could nevertheless present a barrier for some Californians.
RELATED: Millions have signed up for Trump Accounts, but some families are still waiting for baby's $1,000
"I think it's a legit barrier," Newsom said when asked by ABC7 whether politics could discourage families from enrolling.
"I'm pretty aggressive pushing back against Trump, but not on this," he added. "This was one of the really outstanding things that this administration has done. And they deserve a lot of credit."
Newsom said families should focus on the benefit available to their children rather than the politics surrounding the president.
"I hope people get the benefit of this program and don't look at the politics of it," he said.
California wants families to 'stack' benefits
Millions of California children could potentially qualify for more than one savings or investment program.
Newsom said California plans to launch a new tool this fall that will allow families to see which local, state and federal programs their children qualify for, including CalKIDS, California HOPE accounts, ScholarShare 529 accounts and Trump Accounts.
The goal is to make it easier for families to "stack" the different benefits rather than navigating each program separately.
The push comes as California still struggles to connect millions of eligible families with money already set aside for them.
MORE: How the $1,000-per-baby 'Trump accounts' would work and who would benefit most
While 1 million CalKIDS accounts have now been claimed, California has established and funded more than 6 million accounts. Newsom acknowledged Friday that increasing awareness of the program has been a challenge.
The state says CalKIDS has already distributed more than $82 million to roughly 151,000 students pursuing higher education.
San Francisco's earlier Kindergarten to College savings program also provides some evidence that children's savings accounts can affect more than a family's eventual college bill.
City Treasurer José Cisneros said an evaluation found students with accounts were 6% more likely to enroll in college. Among historically underrepresented students, enrollment was 12% higher. Families also reported talking more about college and their children's futures because higher education felt more attainable.
Wealth inequality, without 'demonizing success'
Friday's unusual political alliance also touched on a broader debate over wealth inequality.
Gerstner called wealth inequality "the issue of our time," arguing that giving children an investment account from birth allows them to benefit from the growth of American companies and financial markets.
But Gerstner, a billionaire investor himself, also argued that efforts to narrow the wealth gap should not come at the expense of successful businesses and entrepreneurs.
"We can't demonize success," Gerstner said. "We can't demonize Micron, we can't demonize our founders. We can't demonize the people who provide the economic engine, the abundance that then we can use to lift up those most in need around us."
The comment comes as Newsom has publicly opposed a proposed California billionaire tax, warning that it could drive wealthy residents and investment out of the state.
RELATED: Despite Newsom's opposition, CA Democrats endorse billionaire tax measure
Newsom's message Friday was that expanding ownership can offer another way to tackle the wealth divide.
"We're all better off when we're all better off," Newsom said.
