Lessons In Personal Finance From Harry S. Truman

Harry S. Truman was our 33rd President. Just like so many other Presidents before him he had many meaningful accomplishments and contributions to our country. However, a Presidentís history with personal finance is one aspect of every Presidentís life that can be particularly interesting.

In Harry Trumanís case, the small slice of his personal history regarding financial matters, presents two primary lessons to be learned. Truman never seemed to accumulate large assets that guaranteed economic security. He did, however, have an incredible work ethic and ambitious drive, which translated into regular moves into higher paying elected positions, even without a college degree. It would be easy to get torn on the question of learning what to do or what not to do financially from Truman. Perhaps, after you read his personal history, you will find a life lesson you can apply to your own situation.

Harry Truman's Salary History

As a child Harry Truman worked on his parents successful farm. They were not poor or rich, but probably somewhere in between until 1901 when his father lost the family savings and assets in a financial investment.

In 1903 Truman was working as a banking clerk, but was good enough at his job to move from $35.00 a month to $100.00 a month.

In 1917 Truman was stationed in France as an artillery officer during World War I. He was most likely paid about $100.00 a month. (The average salary during this decade was $62.50 a month). It was during the war that Truman had moderate success in retail! He ran his own canteen selling non-Army issued items to soldiers. (Truman: His Life And Times, Burnes, p74) (Truman, David McCullough, p107)

Once Truman returned from the war he moved in with his wife and mother-in-law and noted that the only possessions he owned at that time were a few articles of clothes, things he brought back from his Army days, and some books. At that time he sold his part of the family farm for $15,000.00 and invested it into a clothing store that he co-owned with a partner.

In 1921 Trumanís salary was probably close to nothing. He was living in debt and trying to keep his failing business open.

One point many historians made about this time was that Truman and his partner agreed to continue paying on the debt they incurred even though they were forced out of business.

He and his partner committed to pay back all the money, but his partner gave up in 3 years and declared bankruptcy. Truman continued to pay down the debt on his own, however. He continued paying down the debt, even while the Great Depression was occurring, until 1934 when a political supporter bought his debt allowed him to pay it off for $1,000.00.

In 1922 he was elected Missouriís Jackson County judge and was paid $3,465.00 per year. (Truman, David McCullough, p160) The average salary at that time was $1,236.00. Prior to the election he had listed his total worth at $230.00 (Harry S. Truman: A Life, Ferrell, p102)

In 1925 Truman lost reelection and took a job selling AAA automobile club memberships for $15.00 each for one year until he was elected back into a judgeís position. (Harry S. Truman: A Life, Ferrell, p104)

In 1926 he was elected as the presiding judge and was paid $6,000.00 per year. During that time the average household income was about $1,300.00 according to the Bureau of Labor Statistics. (Truman, David McCullough, p173)

In 1934 Truman was elected senator and made $10,000.00 a year. The average salary at that time was about $1,600.00. (Truman, David McCullough, p221) Also keep in mind that this was during the Great Depression and unemployment was as high as 25% in 1933.

It is interesting to learn that Truman kept very detailed records of his expenses, including what he was paying for bus fare and groceries while in Washington serving as a senator. He would record his mileage, gas, and lunch expenses and keep those records in his car. Even when he had a driver after being elected President he had a hard time giving up that habit. This trait demonstrates that he was concerned enough about budgeting and managing his money. (Truman, David McCullough, p221 & 405)

In 1944 he was chosen to be the Rooseveltís third vice-president. His salary jumped to $20,000.00 per year. The average salary at that time was $2,400.00.

In 1945 Franklin Roosevelt died and Truman became the President of the United States. His salary was $75,000.00 and then increased $100,000.00 a year along with a $50,000.00 a year tax free expense account in 1949. The average salary at that time was still $2,400.00.
(Truman, David McCullough, p928) In 42 years, Trumanís annual income had increased from $100.00 a month to over $8,300.00 a month at the time of his presidency; an 8,233% increase.

In 1953 Truman had to take out a loan for living expenses as he transitioned from the Presidency and into private citizenship. During this time there was no pension for the President; he qualified for a military pension of $95.66 per month. (Truman, David McCullough, p928)

In 1954 Truman left the Presidency with little personal wealth to show. Truman and his wife moved back into a modest Missouri home. Truman and his wife were the first to receive Medicare subsidy.

In 1954 he sold the rights to his biography for $600,000.00 which would be paid over 5 years, and in 1958 Congress passed a law to retroactively provide former presidents a pension of $25,000.00 a year

Lessons Learned
Trumanís history documents an intense focus on career. He worked in elected, public positions for decades and excelled at what he did. Truman advanced because he added value to each position he held. Because of his regular ďpromotionsĒ into more visible and higher paying positions he and his family were able to live a more comfortable life as time went on. It is a valuable lesson for anyone who is paid by someone else. Adding value to the organization you work for is the best way to be recognized and rewarded with advancement.

There is another side to the story of Trumanís career, though. With all of his energy and focus placed on achieving higher stations he invested very little into his personal economic security. For many years his higher salaries were counter acted with supporting various family members in need and paying off accumulated debt. At the end of his career he had only one truly valuable asset Ė his story. In fact before he was able to capitalize on that asset he was borrowing money in order to make ends meet as he left the Oval Office. Truman may be the exception to the rule, however, since the majority of us will not have a $600,000.00 story to tell. If you havenít financially planned for the future and devoted all your effort to only one interest you may be faced with the potential of a lower standard of living during the time you thought would be your most enjoyable years.


Resources
Talking with Harry: candid conversations with President Harry S. Truman
Ralph Edward Weber

Harry S Truman: Fair Dealer and Cold Warrior
William Pemberton

Truman
David McCullough

Harry S. Truman: A Life
Robert Ferrell

http://www.thepeoplehistory.com/

http://www.trumanblog.com/what%E2%80%99s-a-president-worth#respond

For more financial profiles of famous figures visit the Celebrity Financial Lessons Archive! Also, readers are always welcome to join me at LinkedIn!

More stories: Duncan Hines   George Washington   Thomas Jefferson   Benjamin Franklin   James Garfield   Henry Ford   Alexander Hamilton

 
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