American money: What Ben Franklin teaches about personal finance


Paul Conley

Paul Conley

Blog author Paul Conley

Paul Conley is a writer, a Dad and a communications consultant living in New York City. You can learn more about him at

Published January 8, 2018 | 5 min read

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Featured Image American money: What Ben Franklin teaches about personal finance

“Having been poor is no shame, being ashamed of it is.” — Ben Franklin

If you were to look for the root of the particularly American approach to personal finance — one marked by a belief in self-employment, self-denial and self-sufficiency — you need look no further than the face on the $100 bill.

Ben Franklin, the printer turned inventor turned statesman, was also America’s first personal-finance writer. The prolific Franklin produced an extraordinary number of essays, stories and letters aimed at spreading his beliefs about money and work.

Much of that work was published under the nom de plume “Poor Richard” and appeared in Poor Richard’s Almanack — a collection of poems, weather predictions, astronomical guides, puzzles and suggestions for managing a household. The Almanack was published yearly from 1732 to 1758. And its enormous popularity in the colonies and Europe turned Franklin into a sort of philosopher king.

Advice from Poor Richard

But there’s no need to read through all of Franklin’s work to get the gist of his financial advice. Franklin himself distilled it into a tiny, easily digested form.

In 1758, Franklin pulled together a series of his best known quotes about money and business and weaved them into a short story. In that tale, Poor Richard is considering buying a new coat when he wanders into a crowd where a wise old man called Father Abraham is preaching about how to achieve wealth. Much to Richard’s surprise, Father Abraham’s speech involves endlessly quoting the work of Poor Richard. When the story ends, Poor Richard, having been reminded of his own wisdom, forgoes the purchase of a new coat and resolves “to wear my old one a little longer.”

The short story first appeared as a preface to the annual Almanack. Later it was published as a standalone book, just 30 pages long in most printings, called “The Way to Wealth.”

Quakerish, but not a Quaker

Franklin’s views on money were shaped by his difficult history. Born in Boston in 1706, he was the 10th son of a soap-and-candlestick maker. He worked briefly for his half-brother as a printer in Boston until a family dispute led Franklin to leave Boston and seek his fortune in Philadelphia.

Arriving in the City of Brotherly Love with little other than ambition, Franklin struggled in poverty. Eventually, however, Franklin was befriended by a number of Quaker businessmen who shared their beliefs about how to run a business and achieve wealth. Franklin proved an able pupil. And although he never converted to Quakerism, he was known to dress in Quaker fashion and live a Quakerish life of thrift and self-employment.

“The Way to Wealth” is broken into four sections, each of which echo the Quaker approach to personal finance that dominated Philadelphia during Franklin’s time. And today — more than two and a half centuries after it was published — “The Way to Wealth” shows a simple, four-pronged approach to amassing and sustaining wealth. The trick, according to Franklin/Father Abraham/Poor Richard, is to develop Industry, Care, Frugality and Knowledge.

1. Industry

The story starts as the crowd asks Father Abraham for his thoughts on taxes. The wise old man, although clearly not enamored of taxes, tells the crowd there are far more odious drains on their income.

“We are taxed twice as much by our idleness ...and four times as much by our folly,” Abraham says, quoting Poor Richard.

Father Abraham goes on to use a number of Poor Richard’s more famous lines about the usefulness of hard work. Among the more notable of these are:

  • “If you love life, then do not squander time, for that is the stuff life is made of.”

  • “Early to bed and early to rise, makes a man healthy, wealthy and wise.”

  • “Never leave till tomorrow what you can do today.”

2. Care

Next Father Abraham turns his attention to business, urging the crowd to focus always on supporting the enterprise that supports them and to exercise caution and self-sufficiency in business.

We must be “steady, settled and careful, and oversee our own affairs with our own eyes, and not trust too much to others,” he says

Once again, he quotes often from Poor Richard:

  • “Keep your shop and your shop will keep you.”

  • “If you want a faithful servant, and one that you like — serve yourself.”

3. Frugality

Franklin is often mistakenly said to be the originator of the phrase “a penny saved is a penny earned.” But versions of that line precede his birth, and first use of the exact wording doesn’t appear until years after his death. Nonetheless, Franklin did give us much of the conventional wisdom about the value of saving cash. And in the third section of “The Way to Wealth” Father Abraham serves up some of Poor Richard’s best lines about building a reserve fund and avoiding debt.

  • “Beware of little expenses: A small leak will sink a great ship.”

  • “Buy what you do not need, and soon you will sell your necessities.”

  • “Rather go to bed supperless, than rise in debt.”

4. Knowledge

With all his talk of skipping meals, saving cash and working hard, it’s easy to imagine Franklin as a bitter, cheap, Scrooge-like character. But that would be to misunderstand his work. Franklin was quite clear in his belief accumulating wealth was the means, not the end. Franklin wished for wealth, and was willing to work hard and accumulate it slowly, so that he could eventually turn his focus to more important things.

In a letter to his mother, written at the peak of his fame and wealth, he said he hoped to be remembered as someone useful, rather than rich. And in keeping with that notion, Franklin placed many of his inventions into the public domain, forgoing the protections of patents.

But in the end, the knowledge that Franklin seems most eager to convey is one all of us recognize: It’s much easier to learn personal finance wisdom than to practice it. “The Way to Wealth” ends with the crowd forgetting Father Abraham’s advice and returning to their spendthrift ways.

Because as Father Abraham, quoting Poor Richard, says, “They that will not be counselled, cannot be helped.”

This article is the first in a series on what America's founding fathers can teach us about managing money. For a decidedly eastern approach to wealth, check out these money lessons for Confucious.

Image: Terraxplorer