Money for the Rest of Us

This morning I woke up and was shocked at what I found on the front page of today’s Washington Post: the Clintons were $12 million in debt when they left the White House.

No matter what your political leanings, you have to admit that it’s a terrible sign of our times when a President can leave his position with this much debt. Granted, most of the debt was from legal fees from Whitewater, Lewinksy, and campaign fundraising, but still. I suppose one could argue that having debt is the most American trait of all traits…

So how did the Clintons escape this debt and now be worth between $10 and $50 million dollars? Book deals and speeches. The entire Post article is about the speeches former President Clinton has given. He has averaged 352 speeches a year according the to article. But, only 20% were for his own income. Other speeches he gave for free or for donations to The William J. Clinton Foundation (his AIDS charity). In total, he has received over $40 million from speeches since leaving the White House 6 years ago.

The Clinton’s spokesman, Jay Carson, said:

“The reason that he picked paid speeches is that it is an efficient way for him to make a living for his family and allow him a lot of time to do charitable work, which is his passion.”

There are three big personal finance issues I think we can take away from this article.

1. No matter how deep in debt you are, there is always a way out. (Granted, it’s much easier when you’re famous; but $12 million is a lot more debt than the average person has to escape from).
2. By finding something you’re good at and enjoy doing you can succeed.
3. Promoting yourself by working for free is an effective method.

I think that it’s amazing that Clinton only charges for 20% of his speeches and still earns this much money. (About $150,000 per paid speech, on average). But, it makes sense. He promotes himself by speaking for free. You might argue that he doesn’t need to promote himself, but I would disagree. By giving speeches for free he is also allowing others to see his speaking talent lies beyond politics. He also does motivational speeches. When people see that someone is good at something, it justifies paying that person a lot of money. This is a good lesson in entrepreneurship. Provide your service for free will help build up your reputation.

I’m still in shock that a President can leave the White House with so much debt. But I think what is most surprising is that a person with so much debt can still have so much power. President Clinton was, at one time, arguably the most powerful person in the world. And he had millions of dollars of debt. It goes to show that money and power don’t always go hand-in-hand. You can have money without power and you can have power without money. Though, I would imagine that the Clintons now enjoy having both.