Michael Dell's $6.25B Wager on Compounding Earns Praise from Wall Street and Parents

Michael Dell urged parents to focus their children's education on investing, compounding, and capitalism, not on him, just weeks after his foundation's $250 deposits started arriving in millions of American kids' accounts.

He was responding to a father who mentioned that his children had received the money. This exchange took place in the same week that Dell Technologies (DELL) saw its stock surge 16% and approach the $600 mark.

Michael Dell's Advice to Parents on Compounding

Users shared that their children had gotten their $250, encouraging other parents to make sure their kids knew Dell's name and story. Dell replied on Thursday.

“Please teach your kids about investing, compounding, and capitalism, not about me,” Michael Dell responded.

The funds originate from a $6.25 billion pledge made by Michael and Susan Dell in December 2025. It provides $250 each to as many as 25 million children.

Deposits are placed into Trump Accounts, government-backed investment accounts established by a 2025 tax law. The balances are held in low-cost funds mirroring the US stock market, with withdrawals restricted until the children reach 18.

Dell's contribution targets children under 11 born before 2025, living in ZIP codes where median family income is below $150,000. The initial deposits hit accounts in late August.

The White House has separately considered tax breaks for billionaires donating stock to the accounts.

Dell Stock Reaches All-Time High as Economists Debate Who Benefits

Dell closed at $588.40 on Thursday, a record, up 4.5% for the day and 16% over five sessions. The rally has been fueled by demand for artificial intelligence servers.

Out of 22 analysts tracked by TipRanks, 15 rate the stock a Buy, with none rating it a Sell. Their average 12-month price target stands at $597.53.

Dell's comments come as economists question who truly benefits from the accounts. Darrick Hamilton, an economics professor at The New School, argues they advantage families with extra money.

“Equal access to an investment vehicle does not produce equal capacity to build assets,” Fortune reported, citing Darrick Hamilton.

Hamilton points to 529 plans, the long-standing US college savings accounts, where the wealthiest 10% of households hold over 75% of the assets.

He estimates that a $1,000 seeded account grows to roughly $4,000 by adulthood if no additional contributions are made. Families are allowed to contribute up to $5,000 annually.