My LO (almost 3 months) was diagnosed at 4 days old with it. We were told to watch him closely if/when he got a cold, as he's more susceptible to bronchitis and pneumonia. We were also told that it would probably get worse before it got better, although that hasn't been the case so far. He usually only makes noise now when he's drinking too fast, for a few minutes when he first falls asleep, and an occasional minute or two of it during the night.
We go for monthly checkups at the children's ENT at Vanderbilt. So far LO is hitting all of his milestones, is at a good height and weight, and isn't having any labored breathing. ENT says he should grow out of it by 2 years old and as long as his breathing stays unlabored, he keeps growing, and keeps hitting all his age milestones, we have no reason to worry.
For me, his tracheomalacia sound, while scary as sh!t in the beginning as a new mom, has become almost comforting; if I wake in the middle of the night and hear his little whistle or wheeze, I know he's still breathing.