Presidential Pay and Compensation

Effective Jan. 1, 2001, the annual salary of the President of the United States was increased to $400,000 per year, including a $50,000 expense allowance, a $100,000 nontaxable travel account, and a $19,000 entertainment account. The president's salary is set by Congress, and under Article II, Section 1 of the United States Constitution, may not be increased or reduced during his or her current term of office.

Why the Framers Wanted the President to be Paid

As a wealthy landowner and Revolutionary War commander, George Washington had no desire to be paid to serve as president. While he never accepted a salary for his military service, he was finally compelled by Congress to accept $25,000 for his presidential duties. Washington had no choice in doing so because the Constitution mandates that presidents receive a salary.

In crafting the Constitution, the Framers had considered but rejected a proposal that presidents serve without pay. Alexander Hamilton explained the reasoning in Federalist No. 73, writing “a power over a man’s support is a power over his will.” A president—no matter how wealthy—who received no regular salary might be tempted to accept bribes from special interested or to be coerced by individual members of Congress. For the same reasons, the Framers felt it was essential that the president’s salary is insulated from day-to-day politics. As a result, the Constitution requires that the president’s pay be of a fixed amount for his entire period in office, so that Congress “can neither weaken his fortitude by operating on his necessities, nor corrupt his integrity by appealing to his avarice.”

The Framers were also intent on differentiating presidents from kings by making it clear that any American—not just the wealthy or aristocratic—could become president and that the president worked for the people. In Federalist No. 73, Alexander Hamilton wrote that “there are men who could neither be distressed nor won into a sacrifice of their duty; but this stern virtue is the growth of few soils.”

When Congress set the salary of the president at $25,000 a year in 1789, it also set the salary of Vice President John Adams at $5,000 a year, Chief Justice John Jay at $4,000 a year, and members of the cabinet at $3,500 a year. According to computations made by the Congressional Research Service, by one measure President Washington's 25,000 salary equates to more than $4.5 million today.

On a humorous note, when baseball great Babe Ruth—who was paid $80,000 in 1929—was asked how in the world he dared to ask for a higher salary than President Herbert Hoover's, then $75,000, The Babe replied, “I had a better year than he did.'' And of course, that was true because Ruth had hit 46 home runs in 1929, while Hoover presided over the stock market crash that sent America into the Great Depression.

Chief Executive Salary

The increase was approved as part of the Treasury and General Government Appropriations Act (Public Law 106-58), passed in the closing days of the 106th Congress.

"Sec. 644. (a) Increase in Annual Compensation.--Section 102 of title 3, United States Code, is amended by striking '$200,000' and inserting '$400,000'. (b) Effective Date.--The amendment made by this section shall take effect at noon on January 20, 2001."

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Presidential Salaries Through the Years

By Tom Murse

Since initially being set at $25,000 in 1789, the president’s base salary has been increased on five occasions as follows:

• $50,000 on March 3, 1873
• $75,000 on March 4, 1909
• $100,000 on January 19, 1949
• $200,000 on January 20, 1969
• $400,000 on January 20, 2001

In his First Inaugural Address on April 30, 1789, President George Washington stated that he would not to accept any salary or other remuneration for serving as president. To accepting his $25,000 salary, Washington stated,

“I must decline as inapplicable to myself any share in the personal emoluments which may be indispensably included in a permanent provision for the executive department, and must accordingly pray that the pecuniary estimates for the station in which I am placed may during my continuance in it be limited to such actual expenditures as the public good may be thought to require.”

In addition to a basic salary and expense accounts, the president also gets some other benefits.

A Full-Time Dedicated Medical Team

Since the American Revolution, the official physician to the president, as director of the White House Medical Unit created in 1945, has provided what the White House calls "worldwide emergency action response and comprehensive medical care to the president, the vice president, and their families."

Operating from an on-site clinic, the White House Medical Unit also attends to the medical needs of the White House staff and visitors. The official physician to the president oversees a staff of three to five military physicians, nurses, medical assistants, and medics. The official physician and some members of his or her staff remain available to the president at all times, in the White House or during presidential trips.

Presidential Retirement and Maintenance

Under the Former Presidents Act, each former president is paid a lifetime, taxable pension that is equal to the annual rate of basic pay for the head of an executive federal department—$201,700 in 2015—the same annual salary paid to secretaries of the Cabinet agencies.

In May 2015, Rep. Jason Chaffetz (R-Utah), introduced the Presidential Allowance Modernization Act, a bill that would have limited the lifetime pension paid to former presidents at $200,000 and removed the current link between presidential pensions and the salary paid to Cabinet secretaries.

In addition, Sen. Chaffetz’s bill would have reduced the presidential pension by $1 for every dollar over $400,000 per year earned by former presidents from all sources. For example, under Chaffetz’s bill, former President Bill Clinton, who made almost $10 million from speaking fees and book royalties in 2014, would get no government pension or allowance at all.

The bill was passed by the House on Jan. 11, 2016, and passed in the Senate on June 21, 2016. However, On July 22, 2016, President Obama vetoed the Presidential Allowance Modernization Act, telling Congress the bill “would impose onerous and unreasonable burdens on the offices of former presidents.”

Help With Transition to Private Life

Each former president and vice president may also take advantage of funds allocated by Congress to help facilitate their transition to private life. These funds are used to provide suitable office space, staff compensation, communications services, and printing and postage associated with the transition. As an example, Congress authorized a total of $1.5 million for the transition expenses of outgoing President George H.W. Bush and Vice President Dan Quayle.

The Secret Service provides lifetime protection for former presidents who entered office before Jan. 1, 1997, and for their spouses. Surviving spouses of former presidents receive protection until remarriage. Legislation enacted in 1984 allows former Presidents or their dependents to decline Secret Service protection.

Former Presidents and their spouses, widows, and minor children are entitled to treatment in military hospitals. Health care costs are billed to the individual at a rate established by the Office of Management and Budget (OMB). Former Presidents and their dependents may also enroll in private health plans at their own expense.

Presidents Who Donated Their Salaries

Though the Constitution mandates that presidents be paid for service, three have refused to do so, choosing to donate their salaries instead.

President Donald Trump, with an estimated personal net worth of $3.1 billion, made good on his campaign promise by donating his $400,000 annual White House salary to various U.S. government agencies. To comply with the Constitution, Trump agreed to accept just $1 of his salary per year.

Thirty-first President Herbert Hoover was the first Commander in Chief to refuse a salary. Having become a multimillionaire as an engineer and businessman before assuming office, Hoover donated his $5,000 annual salary to charitable causes.

President John F. Kennedy had been born into wealth and prestige. When he took office in 1961, the Kennedy family fortune was valued at $1 billion, making JFK the richest president in history at the time. Having already refused his congressional salary while serving in the House and Senate, he refused his $100,000 presidential salary, though he kept his $50,000 expense account for “public entertaining he must do as President.” Like Hoover, Kennedy donated his salary to charity. The largest recipients were the Boy Scouts and Girls Scouts of America, the United Negro College Fund, and the Cuban Families Committee.