Camille Van Vyve
27 May 2025
The American Act: a revolutionary vision for the financial future of youth
The United States has taken a decisive step in long-term savings policy with the proposal of the American Birthright Act. This ambitious initiative could drastically change the way Americans build their wealth, while offering valuable insights for Europe and Belgium.
The fundamentals of the American Birthright Act
The concept is as simple as it is powerful:
- Every newborn on American soil automatically receives an investment account
- The state deposits $1.000 upon account opening
- Family members can contribute up to $5.000 annually, with full tax exemption
- The capital can be invested in an ETF mimicking the S&P 500
- The funds become accessible when the child turns 18
This approach is based on two fundamental principles: harnessing the power of compound interest from birth and making every American child an economically engaged participant in national prosperity.
The concrete financial impact: the magic of compound interest
To understand the true scope of this initiative, let’s examine some projected figures based on an average annual return of 7%:
- At 18 years: An initial investment of $1.000 supplemented by $5.000 annually would reach around $168.000
- At 35 years: Continuing this strategy, the capital would rise to nearly $651.000
- At 67 years (retirement age in Belgium): The amount would peak at over $6,6 million
These figures perfectly illustrate why starting early makes all the difference in long-term investment.
Why this initiative deserves our attention
This approach presents several major structural advantages:
- It addresses the challenges of the pressured pension system by encouraging early capitalization
- It leverages the entire family ecosystem (parents, grandparents, godparents…)
- It represents a moderate cost for the State compared to potential socio-economic benefits
- It creates a tangible link between citizens and national economic growth
- It raises awareness across the population, particularly among young people, about the necessity of long-term savings and investment mechanisms
The “Youth Savings Account,” a dull option
The initiative of the American Birthright Act stands in stark contrast to the traditional European, notably Belgian, approach where families have the freedom to save for their children or not, which usually results in opening a "youth savings account" with extremely low returns. With base rates rarely exceeding 1%, these accounts do not allow for sustainable capital growth over a potentially 18-year horizon. Only returns above inflation, accumulated year after year, can provide young people with a real financial foundation upon reaching adulthood.
Belgian alternative: building wealth for the youngest
In the absence of a similar scheme to the American Act in Belgium, families currently cannot benefit from tax incentives or State contributions for this type of savings. However, Easyvest allows for applying this early investment philosophy. We indeed offer opening of brokerage accounts in the names of minors from birth, accessible with an initial investment of €2.500, with complete flexibility for subsequent contributions. This solution allows parents, grandparents, and relatives to set up a long-term investment strategy similar to that advocated in the American Act, relying on the same principles of compound interest and diversification via ETFs.
A long-term vision for our children
If the American initiative were to set a precedent, it could fundamentally transform our approach to wealth building and financial preparation for new generations. While similar measures have yet to be considered in Belgium, a solution like Easyvest paves the way for families concerned about their future welfare and that of their children. By offering investment portfolios in global equity and European bond ETFs, simple and ultra-diversified, Easyvest is the efficient solution for making long-term savings work at a low cost. Perform a simulation now or directly schedule a meeting with one of our managers to get started!