ILLUSTRATION BY FORBES. PHOTO: US FEDERAL GOVERNMENT
Joe Biden earned $17.3 million over the four years he was out of office, but his net worth is only an estimated $8 million. Why isn’t he richer?
On the day America’s first billionaire president took office, “middle class” Joe Biden boarded the Amtrak out of Washington D.C.’s Union Station, bound for Delaware with the kind of modest fortune you might expect from someone who had spent his adult life as an elected official: $2.5 million, mostly composed of pensions and real estate. But Biden was about to cash in. By the end of 2017, he and his wife Jill had earned $11.1 million. They raked in $4.6 million the next year, followed by $1 million in 2019 and $630,000 in 2020.
The story of how Biden became a wealthy man in the wake of his vice presidency, leveraging his fame to sell books and deliver speeches, has been told many times. But a closer look at the math prompts a question that hasn’t been asked: Why isn’t Biden even richer? If someone starts with a $2.5 million net worth and earns $17.3 million while the markets are raging, you’d expect him to be worth more than $8 million. So what happened to Biden’s money? Well, $7 million of it covered taxes, another $1.3 million went to charity, $180,000 paid for household staff and an estimated $80,000 went toward interest on mortgages. Take those items out, though, and you’re still a few million above Biden’s estimated net worth.
There’s a chance that Biden, who shares his fortune with his wife Jill, gave some to other family members. Or perhaps he just spent it all. In order to be worth $8 million—as an analysis of Biden’s financial disclosure reports, property records and career earnings suggest he is—the president would have had to blow an average of roughly some $2,000 per day over the four years he was out of office.
The White House did not respond to multiple requests for comment about Joe Biden’s money.
You can learn a lot about how a president might manage the country’s finances by how they have handled their own. Donald Trump may have come from a party that prides itself on fiscal conservatism, but anyone with a cursory understanding of his financial history—with huge debts financing lavish developments, many of which failed—could have told you at the outset that he wasn’t the sort of guy who would be likely to watch the national budget carefully. And he didn’t—deficits ballooned 68% even before the pandemic, largely thanks to a massive tax cut that benefitted rich people and corporations.
Biden’s priorities are different. He seems determined to give money to the middle class rather than the wealthy. He has already passed a $1.9 trillion Covid relief bill and just suggested a $6 trillion budget. A detailed look at his personal finances suggest that he and Trump have something in common, however. Both are people who don’t mind taking on debt and enjoy spending freely. So don’t be surprised if the national debt keeps soaring.
Biden Vs. Trump
Joe Biden may be wealthy compared to the average American, but his fortune still pales in comparison to his predecessor.
Biden’s grandfather was an executive with American Oil. His father tried out a number of businesses but they all failed, and the family fell on hard times. He later landed a job as a car salesman. Nonetheless, Joe Biden wasn’t interested in a safe career path. As a student at the University of Delaware in the early 1960s, asked his friends a question: “You guys could be guaranteed—upon graduation—a job at the DuPont company, with a nice starting salary and a job for life, but you would never make more than $40,000 a year (some $350,000 today). Or you could take a job at half the salary, no guarantees, but there would be no limit to the money you could make. Which would you take?” The answer was clear for Biden. He told his friends he would take the chance.
After graduating from law school, Biden bet on himself, borrowing money from the bank that financed the cars his father sold to start his own firm in downtown Wilmington, Delaware. But he wasn’t a big saver. After the firm won its first big case, Biden received a $5,000 check. He and his wife Neilia, a schoolteacher, promptly spent it on a four-poster bed, a dining set and a desk. “The bill was substantial—maybe more than the check—but so was the furniture,” Biden wrote in his 2007 memoir, Promises To Keep. “This was our adventure, and Neilia was so sure of our future.”
That future quickly included a small collection of real estate. In the span of about six months, Biden acquired three houses, including one on 80 acres of land in Maryland—where he had a grand dream to one day develop a family compound for his parents and siblings. To swing it, he borrowed some money from his father-in-law and more from banks, while he and Neilia found tenants and rented out the properties. Biden and his wife and young sons lived in a small house rent-free in exchange for managing a nearby country club pool. Even after collecting rent, money was still tight. Biden himself acknowledged in his memoir, “I was in constant danger of falling behind.”
That didn’t stop him from dreaming even bigger. After a tragic car accident in 1972 that killed his wife Neilia and baby daughter, Biden bought a new home for him and his boys—paying $185,000 (equivalent to $930,000 today) for a 10,000-square foot DuPont mansion in Wilmington. At the time he bought it, Biden’s salary as a senator was around $43,000 a year. Over the years, he refinanced the home frequently, taking on mortgages in amounts far exceeding what he originally paid for the house. Biden sold it in 1996 for $1.2 million and bought land nearby for $350,000. He built a new house on the plot, then proceeded to regularly refinance it as well.
Biden put his three kids through private schools and college with the help of borrowed money. “Home ownership is how most middle-class families save, how most middle-class families build assets and for many, it’s the way you send your kid to college, borrowing against it,” Biden explained at a 2015 event for the Department of Housing and Urban Development. “That’s how I got my children to college.” In 2001, when his daughter Ashley was a student at Tulane University, he was on the hook for at least a half dozen loans totaling more than $700,000.
Inside Joe Biden’s Wallet
Biden has amassed an $8 million fortune, thanks to a few lucrative years on the book and speaking circuit. He now owns two houses, worth more than $4 million together (net debt), and keeps at least $950,000 in cash accounts.
If you look at these moves from a business perspective, they don’t make much sense. Biden was stretching himself thin, without saving or investing much money. But if you look at them from a quality-of-life perspective, they have a little more logic to them—“middle-class Joe” wanted to live an upper-class lifestyle, enjoying big homes and sending his kids to pricey schools, so he borrowed big. “What is very common in the United States today, is most people, even with large incomes, are strapped for liquidity,” says Megan Gorman, an attorney and managing partner at a financial planning firm for high net worth individuals, who also serves as a Forbes contributor. “When you look at the Bidens’ tax returns, what you see is, a couple who over the course of their lives have accumulated things like pensions, life insurance, some savings. And it's not some big, calculated plan to be this ultra-high net worth individual.”
After Biden became vice president, he received some extra income to pay for his house. In a Trumpian move, he rented out a cottage on his Wilmington property for $26,400 a year, reportedly leasing it to the U.S. Secret Service in charge of protecting him.
Just because you’re tight on cash doesn’t mean you’re broke. When Biden left office in 2017, he was worth an estimated $2.5 million. He had a life insurance policy and a handful of retirement accounts, but the majority of his net worth came from his Delaware home and his federal pension, which guaranteed him annual income of some $160,000 for life.
More liquidity came fast, as Joe and Jill Biden started writing books and delivering speeches. The former vice president received a plum professor gig at University of Pennsylvania. With greater earnings came greater spending. In 2017, the Bidens paid $8,600 for household labor, according to their tax returns. By 2020, that number had ballooned to $95,250. A White House spokesperson did not respond to a request for comment about what sort of staff the Bidens employed. They handed out $1.3 million to more than two dozen charities, including organizations like the United Jewish Federation of Chicago and the Beau Biden Foundation for the Protection of Children. They also paid off one mortgage and two lines of credit.
Following through on a longtime promise to his wife, Biden shelled out $2.7 million in June 2017 for a 4,800 square-foot summer home in Rehoboth Beach, Delaware. It turned out to be a decent investment: The house is now worth an estimated $3.4 million, up about 25% from what they paid four years ago, thanks to surging home values during the pandemic.
But the Bidens don’t appear to have done much else to grow their fortune through investments. While Biden has made pledges to not invest in individual stocks as a way to avoid ethical conflicts in his job, he has also shied away from investing even in diversified mutual funds—holdings that ethics experts often recommend to avoid conflicts of interest. A 2019 financial disclosure shows that the Bidens had less than $200,000 in mutual funds held inside a variable annuity, with the remainder of their fortune sitting in cash accounts, state retirement accounts, life insurance policies and holding companies for their writing and speaking endeavors. By not participating much in the market, they missed out on stock gains that could have added millions more to their fortune.
On Biden’s most recent financial disclosure report, filed in May, the president listed cash and retirement accounts worth somewhere between $1.2 million and $2.9 million. If you just take his $17.3 million of earnings and subtract all $11.8 million of known expenses—taxes, charitable deductions, housing costs and so on—that would leave you with $5.5 million. Since Biden’s disclosure shows cash and retirement accounts worth $1.2 million to $2.9 million—far less than the $5.5 million figure—that suggests Biden parted with at least $2.6 million elsewhere. One possibility is gifts to his family. Federal tax laws allow couples to hand off $30,000 per year to anyone without having to report it. If Joe and Jill Biden gave the maximum to their two children, Hunter and Ashley, along with their grandchildren, that could account for over $200,000 a year. Biden also could have made additional gifts to charities outside the U.S., which would not show up on his tax returns. In 2018, for example, the Bidens donated $25,000 to a British charity tied to Prince Harry.
Or maybe they just spent it all, enjoying their money without thinking too strategically about it. The Bidens installed a new pool at their Rehoboth house in 2017. Local pool professionals suggested that could cost more than $75,000. In 2019, the Washington Post re
Even if the Bidens keep spending freely, they’re not likely to run out of cash at any point. They could spend $2,000 a day for the next eight years and still walk away from a potential second term with more than $2 million, just like they did in 2017. Once again, they’d be in position to deliver speeches and write books, poised for yet another windfall.
