Lessons From President Obama’s $5.5 Million Income

Filed under: Professional Profiles, Celebrity News, Lynnette Khalfani-Cox

President Barack Obama and First Lady Michelle Obama released their joint income tax returns on April 15th, and the documents showed that the duo earned a pretty nice fortune in 2009: $5.5 million to be exact.

The President’s tax records also provide some interesting lessons for less wealthy Americans. Here are three such lessons:

* Passive Income is Great

The overwhelming majority of Obama’s income was from book sales. Obama has written two enormously popular books, ‘Dreams From My Father’ and ‘The Audacity of Hope.’ Yet, both titles were penned years ago. The fact that the president still continues to collect a substantial income from work long since completed — i.e. his writing — is a testament to the value and impact of generating passive streams of income.

Many wealthy people in America have built their fortunes through this very basic technique. That includes authors who get paid long after they’ve written a book (be it a best-seller or not), singers who reap music royalties well beyond the time their songs are Top 20 hits, and real estate property owners who collect rental income for years from tenants. All are passive streams of income.

* Multiple Streams of Income Help

With the Obamas, as mentioned, the great bulk of their income came from the President’s writings. In fact, Michelle Obama earned no professional income in 2009, the White House said. Obviously, she focused in 2009 on making the family’s transition from Chicago to Washington D.C. and ensuring the well-being of the couple’s daughters, Sasha and Malia.

But let’s not forget that Michelle Obama was once a high-powered career executive in her own right. She previously pulled down a six-figure annual salary. So even though her 2009 income was zero, in the real world dynamic couples like Barack and Michelle Obama almost always fare better when there are multiple sources of income.

For more information on having multiple streams of income, pick up a copy of Robert Allen’s book, ‘Multiple Streams of Income.’ It’s a fantastic look at how to get rich by diversifying your income streams.

* Giving Back to Charity Matters

The first couple’s tax returns also showed that they’ve given generously to charity. The Obamas collectively donated $329,100 to 40 charities to show their support of causes ranging from anti-poverty initiatives to the enhancement of historically black colleges and universities.

The Obamas apparently realize that “to whom much is given, much is required.” And their generous philanthrophic contributions surely come back to them many times over. Indeed, the Bible teaches: you reap what you sow. I believe their generosity explains, in part at least, why the Obamas have been financially blessed.

What lessons do you see in the fact that President Obama netted $5.5 million in income last year?

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Lynnette Khalfani-Cox, an award-winning financial news journalist and former Wall Street Journal reporter for CNBC, has also been featured in top newspapers including the Washington Post, USA Today, and the New York Times, as well as magazines ranging from Essence and Redbook to Black Enterprise and Smart Money. Check out her New York Times bestseller, ‘Zero Debt: The Ultimate Guide to Financial Freedom.’

 

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