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Where Senators Put Their Money: Reid, McConnell & More

By Carla Fried

Updated on: June 20, 2011 / 2:48 PM EDT / MoneyWatch

Millionaires may not be a dime a dozen in the U.S. Senate, but it's getting close. According to the Center for Responsive Politics, about 60 percent of U.S. Senators are millionaires, compared to just 1 percent or so of the general U.S. population. And in just-released 2010 disclosures, both Senate Majority Leader Harry Reid and Minority Leader Mitch McConnell confirmed that they are indeed part of the Senate's millionaire's club.

All members of Congress are required to file an annual personal financial disclosure form that lists assets and liabilities, excluding any real estate that is used exclusively as a residence and does not generate income. In addition to Reid and McConnell disclosing assets well into the seven figures, House leaders John Boehner and Nancy Pelosi are also millionaires, making it a clean sweep for the leadership. (Earlier 2010 financial disclosure by President Obama and First Lady Michelle Obama show that they too are worth well more than $1 million.) Pelosi is by far the wealthiest among the Congressional leadership, but representative Daniel Issa of California is the single wealthiest member of Congress, with a reported net worth of at least $224 million.

MoneyWatch already took a spin through the finances of the House leadership. Here's a peek into the Senate leadership.

Next: Harry Reid: Big Gain on Arizona Land

Harry Reid: Arizona property jumps at least 300 percent.

Senate Majority leader Harry Reid represents Nevada, but it's a 160-acre parcel of land just over the Nevada border in Bullhead, Ariz., that made for a very lucrative 2010, at least on paper. While Arizona home values are getting gob-smacked by foreclosures, Reid says the value of this land is between $1 million and $5 million. Just one year ago, the senator's financial disclosure valued the land at between $250,000-$500,000. So on the low-end the investment gained 300 percent, on the high end it's a 900 percent rise in stated value. Bullhead is just across the Colorado River from Laughlin, Nev., a secondary, but bustling casino destination. In the past, the Senator has pushed for a second bridge to be built to connect the two cities; a move that would likely enhance Laughlin's economy, and the value of Reid's property. The bridge to Laughlin has been a long ongoing political wrangle for both states, and a final decision is due soon on whether the bridge to Laughlin will get greenlighted.

Senator Reid's land and mining holdings account for between $1.865 million and $6.985 million of his stated assets. The rest is invested in nearly four dozen publicly traded exchange-traded funds and municipal bonds.

On the fund front, Reid 's portfolio is heavy on index funds. The Senator has handed over management of his funds and bonds to Wells Fargo Private Bank advisor Andrew Noll, who manages the money without consulting Reid or his wife Landra. Instead of a few broad-based market indexes, Noll takes a more tactical approach and invests the Reid's money in nine different Dow Jones sector-specific exchange-traded funds. At the end of 2010 the single largest fund allocation was in the Dow Jones U.S. Technology Sector index fund. On the bond front, the Reid's favor education bonds, but none are from Nevada.

While Reid's House counterpart John Boehner, reported 121 trades last year, Reid's portfolio follows a more pronounced buy-and-hold strategy. There were just 7 trades listed for 2010, and five were the result of bonds reaching maturity.

Reid disclosed one big gift; a lift home at the Christmas recess on California Senator Dianne Feinstein's private jet, valued at $14,500. Senator Feinstein made a pit stop in Reno to let off the Reids. Senator Reid also reported that his 2008 book The Good Fight didn't generate any royalty income in 2010. By comparison, President Obama's book royalties totaled $1.57 million for 2010.

Next: Mitch McConnell: Conservative with Money, Too

Senator Mitch McConnell: Conservative with Money too.
Senate Minority Leader Mitch McConnell reported 2010 net worth of between $9.2 million and $43.1 million. He and wife Elaine Chao, who served as Labor Secretary for President George W. Bush and now works at the conservative Heritage Foundation, are clearly fans of playing it safe with their money.

According to McConnell's 2010 financial disclosure, the couple has between $5 million and $25 million sitting in the Vanguard Tax Exempt Money Market fund. One interesting 2010 move was to sell $1 million from that Vanguard fund and deposit in the SunTrust Advantage Money Market account. Not only does that buy them some FDIC insurance on that money -- bank money markets are covered by FDIC insurance, mutual fund money market funds are not -- but McConnell and Chao may have smartly taken advantage of a better yield as well. The SunTrust account is currently offering a 1.2 percent yield for new accounts; the Vanguard Money Market, like all money market mutual funds -- especially lower yielding tax exempt offerings -- is yielding 0.02 percent.

McConnell and Chao also own a mix of stock and bond mutual funds. The couple seems to fully appreciate the value of low-cost indexing; between $1.65 million and $6.350 million is invested in the Vanguard Index 500, and there's a separate $50,000-$100,000 invested in the T. Rowe Price Index 500 fund. Their actively managed funds include Matthews Asian, Pimco Total Return and Royce Special Equity.

On the real estate front, McConnell and Chao list a Washington D.C. home valued at between $1 million and $5 million. Personal homes are exempt from disclosure, but McConnell and Chao rent out a carriage house on the property, and any income source must be reported. In 2010 they collected between $5,001-$15,000 in rental income on that property.

Next: Senators Kerry and Rubio: Financial Extremes

Democrat Senator John Kerry and Republican (and Tea Party favorite) Senator Marco Rubio aren't just on opposite ends of the political spectrum, their financial lives could not be more different.

Senator Kerry is the wealthiest member of the Senate, with a stated net worth of at least $193 million. Much of that is a function of the great family wealth of Kerry's wife Teresa Heinz Kerry of the Heinz-ketchup fortune. Kerry's 85 page financial disclosure is a mix of hundreds of stocks, bonds, private equity investments, and hedge fund positions.

Marco Rubio's net worth basically isn't even a rounding error for the Kerry balance sheet. For 2010 the Florida Senator's 10-page disclosure shows a maximum of $30,000 set aside in Citibank savings and checking accounts, another $50,000-$100,000 in a retirement account and between $6,000 and $90,000 invested in Florida 529 College Savings funds for his four children.

Rubio also owns a rental property in Tallahassee, Florida valued at between $100,000-$250,000. There's also an outstanding mortgage on the property valued at between $100,000-$250,000, so it's not clear if Rubio has any equity in the property he bought in 2005. The mortgage is listed as a 30-year fixed rate at 4 percent interest rate; that's more than 1.5 percentage points below the lowest average 30-year fixed rate reported by Freddie Mac in 2005.
Like so many rank and file Americans -- but few on Capitol Hill -- Rubio is still paying down student loan debt. His financial disclosure lists a Sallie Mae college loan of $100,000-$250,000 from 1996. Rubio is paying it back over 30 years, at a reported rate of 4 percent.

See where Congressmen put their money
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