Obama's money

Where he got it

After Harvard Law, Obama didn't exactly rake in the big bucks. He led a voter-registration drive and then worked for a Chicago law firm that specializes in civil rights and employment discrimination.

He earned $60,000 as an Illinois state senator, plus another $32,000 as a lecturer in constitutional law at the University of Chicago.

Michelle Obama, however, worked for a while as a big-firm lawyer, leaving to take jobs in the nonprofit sector. She wound up as vice president for community affairs at the University of Chicago Hospitals, a position that paid nearly $317,000 a year.

She resigned in May and also left her post as lead independent director of Tree House Foods, a private-label food business.

According to the Obamas' tax return (Obama and Sen. Christopher Dodd of Connecticut are the only candidates to release one), their income hit $1.7 million in 2005 and $991,000 in 2006.

The big boost came from his writing, following the stirring speech at the 2004 Democratic Convention that made him famous.

First came a memoir, "Dreams of My Father," and later "The Audacity of Hope," which was on the New York Times bestseller list for 30 weeks.

Where it goes

Excluding Michelle Obama's retirement plan, whose value needn't be reported, the couple has about $715,000 in investments. All the money except for two very large checking accounts is in mutual funds.

About $350,000 is divided between Vanguard FTSE Social Index Fund, a socially responsible fund, and Vanguard Wellesley Income, which has a mix of 60 percent bonds and 40 percent stocks.

How he could do better

The Obamas have about 40 percent of their money in cash - about right for now, says Jason Mirsky of RiskMetrics: "They may need that much cash to tide the family over without Michelle's income."

Later, however, the Obamas should ramp up their stock allocation to about 70 percent. With their earning power, they can take more risk, adding small-cap and international funds.

They could also venture into real estate investment trusts or commodities. They should start 529 college savings plans for their two girls.

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