Being a president, prior to the Former Presidents Act signed under President Eisenhower, there were no retirement income or benefits for our early presidents. Thomas Jefferson was so poor in 1815 that in order to pay his creditors he sold his library to the government, forming the core of the Library of Congress. James Madison, though struggling, managed to retain his estates and died June 28, 1836 at his home in Orange, Montpelier. It wasn't until 1844 that Dolley Madison was forced to sell their estate to pay debts.
So what did a retired president to when he could not pay his debts? They could sell land, borrow from a money-lender, friend/acquaintance or banking institution. Or, they could pawn items or barter them against the debt. There are two histories given concerning these lovely Madison decanters. One is that Madison had used them to pay off a debt to a family ancestor and the other is that they were purchased at an estate sale at Montpelier. Which is true? That has not yet been determined.
These decanters were gifted by Mrs. James Somerville on October 15, 1979. She had received them from Ms.
Rita Graham sometime in the early 1940's. Ms. Graham had inherited them from her grandfather. Her grandfather would have been of an age to have lived at the same time as Madison in his retirement years.
Other early presidents who experienced financial distress post-presidency:
James Monroe's finances were in such a mess that he had to sell Highland and retire to Oak Hill. After his wife Elizabeth died and he was in dire financial straights, he moved in with his daughter in New York City. After his death his body was eventually returned to Virginia (a story by itself!) and interred at Hollywood Cemetery in Richmond.
Due to a enormous stock fraud that cost his life savings, Ulysses S. Grant was forced into poverty in his last years. He managed to provide for his family through a $450,000 advance he received for his Memoirs.; something he was writing while he was suffering from throat cancer and nearing death.
Harry Truman (1948 newspaper printed his loss before the election was finished "Dewey Defeats Truman!") was so impoverished upon his return to Missouri that he had to live with his mother-inlaw. Unfortunately for him, Speaker of the House Sam Rayburn, sat on the pension bill for several years.
He hoped for some relief through the passage of a pension bill, but, for inexplicable reasons Speaker of the House Sam Rayburn sat on the proposal for several years. When it finally became law during the Eisenhower administration, the pension amounted to $25,000. This was not enough to life him out of his troubles, but helped a great deal. At the time of the Bill passing Truman and Hoover (a multi-millionaire) were the only living former presidents. It is said that Hoover only accepted his pension to avoid embarrassing his friend Truman.
Read more: http://www.presidentprofiles.com/General-Information/A-History-of-the-Presidency-Salary-and-pension.html#ixzz4YmfOi7ab