The History of Presidential Salaries: How Much Have U.S. Presidents Earned Through the Years?
Ever dreamt of being a president of the United States? If yes, how much do you think you would earn being the leader of the world’s most powerful country?
What if you had been a president a hundred years back, would you have made the same? Would you have made more or less?
There are very few positions in the world, if any, that compare to being the president of the United States.
The job comes with very tough decision making, extremely long hours, constant travel, and a lot of public and media scrutiny.
With all this, it is not surprising that being the president comes with a hefty paycheck. However, those who run for presidency don’t do it for the salary.
If anything, many of those who run for presidency have already made lots of money elsewhere, and therefore, the presidential salary is not very significant to them.
Still, the presidential salary is quite a huge sum for the ordinary person.
If you are wondering how much a president makes, stick with me. In this article, we’ll look at how much the current president, Mr. Donald Trump, makes for being president, as well as what all the other presidents before him earned during their days in office.
But before we learn how much the president earns, let’s first understand a few things about the presidential salary.
WHO DETERMINES THE PRESIDENTIAL SALARY?
The salary of the United States president is set by the Congress.
The Congress also holds the responsibility of reviewing and increasing the president’s salary.
This means that the president himself cannot increase his or her salary. But being the most powerful person in the country, can’t the president just influence the Congress to increase his salary?
Well, the authors of the constitution probably envisioned such a scenario, and to prevent this, the United States Constitution, under Article II Section 1, states that a president’s salary cannot be increased or reduced during the president’s current term of office.
This means that, even if a president somehow influenced the Congress to raise his salary, he would have to wait till after the next election to start enjoying the higher salary (there is no guarantee he would still be president).
Not only does this prevent the president from influencing the raising of his own salary, it also makes it impossible for Congress to influence or coerce a sitting president by altering – either increasing or decreasing – his salary.
WHAT DOES THE CURRENT PRESIDENT EARN?
Donald Trump, the current president of the United States earns a salary of $400,000 per year.
In addition, the president also receives a $50,000 annual expense account, a $100,000 non-taxable travel account, and a $19,000 entertainment account.
The president’s salary has not always been $400,000. The $400,000 salary only became effective in January 2001.
The increase came as part of the Treasury and General Government Appropriations Act, which the 106th Congress passed during its closing days.
Among the incentives for raising the presidential salary was the fact that with the steadily rising common cost of living, the salaries of several other federal officials were constantly being increased, and some federal officials were set to earn more than the president if nothing was done.
Therefore, the 106th Congress decided to double the president’s salary. Since the changes took effect on January 2001, President George W. Bush, who took office the same year, was the first president to earn a $400,000 salary.
Since the change became effective, the presidents who have earned the $400,000 salary are George W. Bush, Barack Obama, and the current president Donald Trump.
HOW MUCH DID PRESIDENTS EARN BEFORE?
The previous section makes it clear that United States presidents have not always earned a $400,000 salary. So, how much did they earn before?
Well, before the 2001 change, the president’s salary has been increased on four more occasions. Below are some of the other times the presidential salary was increased.
The concept of the United States of America ruled by a president was introduced with the adoption of the US constitution in 1789. Under the newly adopted constitution, the salary of the president was set at $25,000.
It would be another 8 decades before the Congress would raise the president’s salary. George Washington, one of the founding fathers, and the first president elected under the US constitution, also became the first president to earn the $25,000 salary.
In 1873, 84 years after the first US president took office, the Congress decided to raise the president’s salary.
Starting with Ulysses S Grant’s second term in office, the salary of the president was doubled from $25,000 to $50,000. After this, the presidential salary would remain unchanged for over three more decades.
After 36 years, Congress once again made amendments to Article II Section 1 of the US constitution and increased the salary of the president to $75,000.
These changes took effect in 1909, just as William Howard Taft came into office. It would be another four decades before this salary was reviewed again.
In 1949, the presidential salary was once again increased, this time by 33 percent, taking the new presidential salary to $100,000. The new changes took effect just as Harry Truman was beginning his second term. This made Truman the first ever American president to earn a six figure salary.
The $100,000 salary would remain effective for the next 20 years. Aside from Harry S. Truman, the other presidents who took home the $100,000 salary are Dwight Eisenhower, John F. Kennedy and Lyndon Johnson.
In 1969, just as President Richard Nixon was taking office, the Congress once again decided to double the presidential salary from $100,000 to $200,000, making Richard Nixon the first president to pocket a $200,000 annual salary.
This salary would remain in effect for slightly over 30 years. Aside from Richard Nixon, the other presidents who received the $200,000 salary include Gerald Ford, Jimmy Carter, Ronald Reagan, George W. Bush, and Bill Clinton.
In 2001, the president’s salary was eventually increased from $200,000 to $400,000, which is what US presidents earn to this day.
IS THAT ALL THAT PRESIDENTS MAKE?
While the $400,000 figure enough to put American presidents in the top 1 percent of the highest income earners, it is just the basic salary US presidents earn for holding the position of president.
Aside from this basic salary, there are other financial benefits that come with being the president. These include:
A Dedicated Medical Team
The president of the United States has an official physician, who is also the director of the White House Medical Unit.
The role of the White House Medical Unit is to provide the president with comprehensive medical care as well as worldwide emergency action response. This is not only limited to the president, but to his family as well.
The White House Medical Unit maintains an on-site clinic at the White House and is manned by 3 to 5 military physicians, as well as a team of nurses, medics, and medical assistants.
The Director of the White House Medical Unit and some members of his staff are available to the president around the clock, whether he is at the White House or traveling on official business.
Annual Expense Account
Starting in 1949, the US Congress decided that the president should also be entitled to a $50,000 annual expense account that they could use for miscellaneous expenses. The tax status of this account has changed severally.
At the moment, the account is non-taxable. In most cases, the funds in the annual expense account have been used to cover the costs of meetings that do not fall within the budgets of governmental departments.
Sometimes, the funds in the annual expense account do not get used or are only partially used, in which case they are given back to the treasury.
Who said that you cannot have some little fun just because you are president of the most powerful country in the world? The president of the United States is entitled to a $19,000 entertainment. This entertainment account started during president Richard Nixon’s term in office. Initially, the entertainment account started at $12,000, but was later increased to the current $19,000. It’s good to note that these funds are not used to cater for official functions, since the State Department covers the cost of these. In addition, any performers at the White House usually do it for free.
The US government wants to make sure that the president and the first family feel at home at the White House, and therefore when a new president is elected, the president and his family are given $100,000 to redecorate the White House to their liking.
However, the president is free to reject this money if they so wish. For instance, when former president Obama took office, he did not take the redecoration allowance. Instead, the Obamas opted to use their own funds to redecorate the White House.
When Donald Trump took office in 2016, he reportedly spent $1.75 million to redecorate the White House and buy new furniture and wall coverings, though it is not clear whether the cost was footed by the tax payers or from his own personal accounts.
DO PRESIDENTS EARN ANYTHING AFTER THEY LEAVE OFFICE?
The financial perks of being president of the United States do not come to an end once one leaves office.
Even after retirement, former presidents continue receiving several benefits. Some of these include:
Under the Former Presidents Act, former presidents are entitled to a lifetime taxable pension. According to the Act, this pension should be equal to the annual basic pay for the heads of executive federal departments, such as Cabinet Secretaries.
This amount is usually determined by Congress. At the moment, the presidential pension stands at $210,700 per year. The former president starts earning the pension the minute they officially leave office.
In addition, the widows of former presidents are also entitled to an annual lifetime pension of $20,000, though they are free to waive that right if they so choose.
Initially, there was some confusion as to whether presidents who resigned were also entitled to the pension.
To clear the air, the Justice Department in 1974 ruled that the right to lifetime pension as well as all other benefits that former presidents are entitled to also applies to presidents who resign from office before the official expiry of their terms in office.
However, a president is not entitled to these benefits if they are removed from office through impeachment.
In May 2015, a bill known as the Presidential Allowance Modernization Act was introduced to Congress by Jason Chaffetz, the representative for Utah.
This bill sought to delink the presidential pension from the salaries of Cabinet Secretaries and limit it (the presidential pension) to $200,000 per year.
In addition, this bill also sought to reduce the presidential pension by $1 for every dollar over $400,000 that a former president earned every year from all sources.
For instance, under this bill, former president Bill Clinton would not be entitled to any government pension in 2014, since he made close to $10 million from book royalties and speaking fees within that year.
In January 2016, Senator Chaffetz bill was passed by the house, and later in June 2016, it was also passed by the Senate.
However, in July 2016, President Obama vetoed the bill, claiming that it would impose oppressive and unreasonable burdens on former presidents.
After leaving office, former presidents are also given funds to help facilitate and cushion their transition to private life.
These funds, which are allocated by Congress, are used to cater for expenses such as office space, communication services, staff compensation, printing and postage, and so on.
The transition expenses will vary from president to president. For example, when leaving office, former president George W. Bush and his vice president Dan Quayle were given a transition expenses account totaling to $1.5 million.
Aside from the transition expenses, which are applicable for the first six months after leaving office, the former president also continues to receive funds for an office staff. For the first 30 months after leaving office, the funds for this purpose are capped at $150,000 per year.
After the first 30 months are over, the funds allocated to former presidents for staff compensation should not exceed $96,000 per year, according to the Former President’s Act. Any staff costs exceeding $96,000 per year must be paid from the former president’s personal accounts.
Lifetime Protection and Medical Attention
Even after leaving office, former presidents and their spouses are entitled to receive lifetime protection from the Secret Service.
If a former president passes on, their surviving spouses will continue receiving protection from the Secret Service until they remarry.
If the former first family had children, the children are also entitled to protection until they reach the age of 16.
While former presidents and their dependents are entitled to protection, they are also free to decline the protection if they so wish, according to legislation enacted in 1984.
In addition to protection by the Secret Service, former presidents as well as their spouses, minor children and widows will continue receiving lifetime treatment in military hospitals.
However, the former presidents and their dependents are still free to enroll in private health plans if they so wish, though the costs of these will not be covered by the state.
In 1968, a law was enacted that requires the General Services Administration (GSA) to provide former presidents with funds to cover travel, business and related expenses for the former president and no more than two of his or her staff members.
It’s is good to note that this money does not cover travel for leisure. In order for the former president to be compensated for travel expenses, he or she must show that the travel was on official business in their capacity as a former president of the United States.
Other Sources of Income
Aside from the money availed to them by the government, former presidents also have other sources of income which are related to their status as a former president of the United States.
By far, the greatest source of income for former presidents comes from books deals, tours, and speaking gigs.
For instance, after leaving office, former president Bill Clinton made close to $15 million in advance for the book “My Life.” Aside from what he got from the book, he also earned over $75 million from speaking gigs.
Right after leaving the White House in 2001, Bill Clinton is said to have been paid $125,000 for a speech gig by the Greater Washington Association of Executives, which is a standard price for a speech from a former president.
After leaving office, former president George W. Bush wrote the book “Decision Points” and made $7 million for the first 1.5 million copies.
According to estimates by the Center for Public Integrity, George Bush has also brought in about $15 million from giving speeches since he stepped from office. Former president Jimmy Carter also wrote 14 books after leaving office.
Before becoming president, Barack Obama wrote a book “Dreams of My Father”. Initially, the book did not bring in a significant income, but the sales kept rising as he rose higher in politics, and when he ran for president, the book started flying off the shelves.
According to the New York Times, the former president and his wife Michelle Obama stand to make anywhere between $20 million and $40 million in post-presidency book contracts.
PRESIDENTS WHO DID NOT TAKE A SALARY
Despite the presidential salary putting presidents among the top 1 percent highest income earners in the country, and despite it being a constitutional requirement to take the presidential salary, some presidents were not so keen about taking their salaries, opting instead to donate their salaries to charity.
So far, there are four presidents who did not take their salaries. They are:
Donald J. Trump: Before taking office, current president Donald Trump was already wildly wealthy. By the time he took office, he was worth $3.1 billion, according to Forbes, which was actually a decline from his $4.5 billion net worth in 2015.
During his presidential campaign, Trump announced that he would only take a $1 salary since the constitution required him to take a salary. After taking office, he followed his words and has donated his $400,000 annual salary to various governmental departments.
John F. Kennedy: Just like Trump, J. F. Kennedy was a very wealthy man when he took office in 1961. He came from a wealthy family worth over $1 billion at the time. Therefore, he did not really need the presidential salary to get by.
During his term in office, he donated his $100,000 salary to various charities, though he kept the $50,000 annual expense account. Kennedy had also donated all his salary for all the 14 years he served in Congress.
Herbert Hoover: When he took office in 1913, Hoover was worth about $4 million, which was quite a huge amount at the time (about $103 million today). Therefore, when he took office, he donated part of his $75,000 salary to various charities, while the rest he gave to his staff.
George Washington: The first US president was also quite wealthy before becoming president. During his days as a military commander, he had declined taking a salary, claiming that service to the nation was enough for him.
When he took office, he did not want to take a salary, but since the constitution required him to take it, he took the $25,000 salary and donated it.
Being president of the United States is a demanding position, but fortunately, it comes with an equally impressive salary of $400,000 per year.
As we have seen, however, the presidential salary has not always been this high.
It started at $25,000 in 1789 and has been raised five times before reaching the current $400,000.
With the rising cost of living and the constantly increasing salaries of other federal officials, will Congress once again increase the president’s salary?
We can only wait and see.
If you’ve received a job offer that doesn’t quite hit the mark, it’s time to counter it. And if you …
Among the many concerns of jobseekers when preparing their application letter and resume has to do …