Benjamin Franklin's The Way to Wealth, Read Line by Line for Modern Savers

The best personal finance book ever written by an American runs about as long as a long magazine article, was published as the preface to an almanac, and was written by a man who had no financial planning credential and no podcast. It cost a few pennies in 1758. You can read it free tonight.

I am talking about Benjamin Franklin's The Way to Wealth, and I want to read it with you slowly, the way a good teacher reads a founding text: a few lines at a time, asking what they meant when he wrote them and what they mean for a family trying to make rent and save a little. The text is in the public domain, so the quotations below are Franklin's own words as printed in a common modern edition, with spelling and capitalization modernized, and I have kept them short. Where I am summarizing, I say so.

The setting: an almanac, a printer and a pen name

Some background, because it explains the text. Franklin, born in Boston in 1706, was a printer who came to Philadelphia as a young man and built a successful press. From 1732 he published an annual almanac, Poor Richard's Almanack, under the pen name Richard Saunders, a fictional astrologer and the husband of a nagging wife named Bridget. An almanac in the eighteenth century was a household staple: a calendar, weather guesses, tide tables, verses, jokes and advice. Franklin filled the blank spaces with short sayings on thrift, work and prudence, some original and many borrowed and polished. They became famous.

For the 1758 edition, Franklin gathered many of those sayings into a continuous speech and wrote it into the preface. The conceit is a scene at a public auction, called a vendue. Richard Saunders arrives early and finds a crowd of people complaining about the hard times and the heavy taxes. They ask an old man, Father Abraham, what he thinks. He answers with a long speech, stitched from Poor Richard's sayings, and at the end Richard reports, with a straight face, that the crowd approved the doctrine and promptly practiced the opposite. The preface was later reprinted separately under titles such as The Way to Wealth, and it went around the English-speaking world.

A word on the man himself, since the advice carries weight because of its source. Franklin made his fortune from the press and from public printing contracts, retired from active management of his printing business in the late 1740s, and then spent decades on science and public service. He did not inherit his position. His is the story of a tradesman who saved, invested in his own business and built enough independence to serve the public. You can see the same path in the apprentice's road in How a Registered Apprenticeship Works, From the First Day to Journeyman. Franklin practiced what Father Abraham preached, at least until he had earned the right to relax.

The opening: complaints about taxes, and the first turn

The speech begins with the crowd's complaints about the burden of taxes. Father Abraham agrees that taxes are heavy, and then he does something unexpected. He says that if the taxes were the only burden, they might be easier to bear, but that we are taxed in other ways, and far more heavily, by our own habits. In Franklin's words:

We are taxed twice as much by our idleness, three times as much by our pride, and four times as much by our folly.

That is one of the sharpest sentences in American prose, and it deserves a pause. Franklin is not saying government taxes are light. He is saying that the largest tax most of us pay is the one we levy on ourselves, through wasted time, show and foolish spending, and that this is a tax we can repeal without a vote.

What it means for a family today: before we argue about the tax code, which is worth arguing about, we should audit our own habits. A household that spends a dollar a day on things it does not value pays more, over a decade, than most changes in the tax rate would cost it. Do the arithmetic. A dollar a day for ten years is $3,650 before any return it might have earned. A conservative need not be against reducing taxes and also be for reducing waste at home. They are the same moral position, applied to different treasuries.

On idleness and time

Father Abraham's first long section is on diligence. He quotes Poor Richard:

Sloth, like rust, consumes faster than labour wears, while the used key is always bright.

A key that is used stays bright, and one left in a drawer corrodes. The saying makes a point that is true of skills, careers and savings habits alike: a capacity unused decays. Then, on time itself:

But, dost thou love life? then do not squander time, for that is the stuff life is made of.

Franklin understood that time is the one asset no one can buy more of. The modern translation is a time budget alongside the money budget. Add up the hours in a week that go to nothing in particular. If those hours were put to work learning a trade, building a side income or simply keeping up the house, they would be worth something. A family working through a budget might like Give Every Dollar a Job Before the Month Starts, the Zero-Based Budget, which applies the same discipline to money. Franklin would add that every hour needs a job too.

He also has a line on the moral value of work that applies to the first-time worker and the old hand alike:

He that hath a trade, hath an estate; and he that hath a calling, hath an office of profit and honour.

A skill is wealth that no one can take away and that a recession cannot repossess. Compare Work as a Calling, What Scripture and the Reformers Said About an Ordinary Job, which traces the idea of a calling back to the Reformers.

And there is the famous couplet about the sleeping fox. Father Abraham says the sleeping fox catches no poultry. Hustle gets fed. The bed, he warns, is an expensive place to be at the wrong hour.

On saving as well as getting

The center of the speech is on the difference between earning and keeping. Here is Franklin at his most practical:

If you would be wealthy, think of saving, as well as of getting.

A great many people think of wealth as a problem of income. Franklin says it is just as much a problem of outflow. He then gives the great list of small leaks. One of his best sayings is on the subject:

Beware of little expences; a small leak will sink a great ship.

A modern translation: the subscription you forgot, the daily coffee, the fee on the account you do not read. None is a catastrophe. Together they are a hole in the hull. Run the numbers on a small recurring charge, say $15 a month. Over ten years it comes to $1,800, and if that money had been saved and earned a return, it would be more. This is the idea behind Compound Interest Year by Year, the Arithmetic That Rewards the Patient Saver, which shows year by year what steady saving does.

He also sets a limit on extravagance with a line that every household should say aloud once a year:

Buy what thou hast no need of, and ere long thou shalt sell thy necessaries.

The mechanism is the one that sinks a household: spend on wants today, and tomorrow you sell off what you need to cover the bills. This is not an argument against all pleasure. It is an argument for sorting wants from needs before you swipe a card.

On pride, show and fine clothes

Franklin turns to display, and his target is not luxury as such but spending to impress. He quotes Poor Richard's verse:

Fond pride of dress is sure a very curse, ere fancy you consult, consult your purse.

He complains that people will buy fineries on credit, and he adds a memorable thought about how the cost of keeping up a show can feed a family. One saying, which I will give as a paraphrase since I cannot quote its wording with certainty, holds that what maintains one vice would bring up two children. The point is that vanity is expensive in a way that the buyer rarely counts.

For a family today, the modern form is the car payment sized for the neighbors, the house sized for the photographs, the wardrobe sized for a feed. The rule is simple: spend for your own needs and your own values, and let other people's opinions go unfunded. Franklin did not scold people for enjoying good things. He scolded them for borrowing against their future to buy the look of success. A practical piece in the same spirit is The Paid-Off Car Is a Raise, the Arithmetic of Driving Your Car Longer.

On debt, and the creditor's memory

Here Franklin is at his most severe, and at his most useful. He turns to buying on credit and to debt in general. He quotes:

In Father Abraham's speech, in a line I will paraphrase because editions word it a little differently, the borrower is a slave to the lender.

That is strong language, and Franklin intends it. A person who owes money has handed some control of his time, his choices and his peace of mind to someone else. The debtor works for the creditor until the debt is paid. That does not mean all debt is wrong. A prudent mortgage on a home you can afford, or a loan that builds an asset, is not what he is warning against. The target is the borrowing that pays for consumption and has no end in sight. Franklin himself was no enemy of credit in commerce, since he ran a business. He was an enemy of the habit of using it to fund show.

Another of his sayings on the topic is this: "Creditors have better memories than debtors." In his day, a creditor could have a man jailed for debt, so the point was grimmer than it sounds. In ours, it means that a late payment follows you in a credit report for years while the bar tab is long forgotten. For the modern machinery of borrowing, see How a Credit Score Is Built and Why Paying on Time Beats Every Trick and Carrying a Balance Builds Credit and Six Other Borrowing Myths, Tested, and for a plan to get out, Debt Snowball or Debt Avalanche? Two Payoff Plans Run on the Same Four Debts.

There is also an old line about the weight of an unsupported household: "It is hard for an empty bag to stand upright." A person without savings cannot stand firm when pushed. That is the whole case for a cash cushion, made in nine words, and Why the Emergency Fund Comes Before Every Other Money Goal You Have makes it in two thousand.

On learning the hard way

The speech has a note of humility about experience:

Experience keeps a dear school, but fools will learn in no other.

Experience is an expensive teacher, and Father Abraham's whole point is that you can borrow other people's lessons for the price of a pamphlet. That is why we read books, and why a family should talk openly about money mistakes with the next generation. The dearest tuition is the one paid twice.

The ending, and the joke Franklin plays on us

The finish is the best part. After all the advice, Richard Saunders reports that the people heard Father Abraham, approved his doctrine, and then went straight to the auction and bought extravagantly. Richard, for his part, admits that his vanity was delighted to hear his own sayings quoted so often, but he says he resolved to be the better for them, and that he went home determined to wear his old coat a little longer rather than buy cloth for a new one. Franklin is poking fun at his readers, and at himself, because he knows that advice is easy to praise and hard to follow.

The joke is a gift. It reminds us that the way to wealth is not hidden. Everyone in that crowd knew the rules. The difficulty was never knowledge. It was doing. A good budget is the tool that bridges them, which is why the recommended starting place is a one-page plan, written down, and reviewed monthly. A habit is a decision made once and kept.

The strongest objection

An honest reader will ask whether this advice survives modern conditions. The best objection runs: Franklin lived in a world of small shops and cash, where a household could control its costs. Today, housing, health care, education and child care swallow a family's income through no fault of its own, and no amount of skipped coffee will cover a medical bill or a rent increase. Preaching thrift to people squeezed by large costs, the critic says, is blaming the victim.

Let me answer it in order. One, the objection is right about something. Some costs are driven by policy, regulation and market structure, and conservatives should argue vigorously for lowering them, which is the point of much of this blog. Franklin would agree that burdens placed on the people deserve attention.

Two, the objection overstates the case. Franklin's own list was not mainly about coffee. It was about the large categories of discretionary choice: how much house, how much car, how much debt and how much show. Those are exactly the decisions that decide most family budgets.

Three, thrift does not compete with reform. A family with savings can survive a shock that would ruin one without them, which is the entire lesson of the empty bag. Policy and habit are partners. The family that has both is the family that can stand up straight in a recession.

Four, the people who most need Franklin's advice are the ones with the least margin. A dollar saved by a family on the edge matters more than a dollar saved by a family in comfort. Nothing about the sayings is a lecture to the poor; they were written to ordinary working families, and the working families of 1758 were far poorer than ours.

Why Franklin belongs in a conservative's library

The founding generation understood that self-government rests on self-governing citizens. A people that cannot manage its own household is easy prey for anyone who offers to manage it for them, and a people deep in debt is dependent on those who hold the notes. Jefferson worried about public debt, and in a 1789 letter to James Madison he argued that one generation should not burden the next with its debts. The household and the republic obey the same arithmetic. You can see the national version at the national debt clock.

A nation of savers, who can say no to themselves and yes to the future, is a nation that can say no to a tyrant. That is the quiet link between the small leaks in a family budget and the large safeguards of a free country. Franklin, who helped write the Declaration and signed the Constitution, knew both.

The case in brief

1. Franklin's 1758 preface, The Way to Wealth, gathers Poor Richard's sayings into a speech by Father Abraham at an auction.
2. The largest tax most households pay is the one they levy on themselves through idleness, pride and folly, and the habits behind it can be changed without a vote.
3. Wealth is saving as well as getting: watch the small recurring leaks, sort wants from needs and keep a cushion so the bag can stand upright.
4. Borrowing for show makes the borrower the lender's servant, though a prudent loan for a lasting asset is a different matter.
5. The advice fits modern families alongside policy reform, because a family with savings survives shocks that sink one without.

What you can do: read the full text of The Way to Wealth, a public-domain document available free online, then list your five biggest recurring expenses and cross out any you cannot justify.