The following is an article from the October 2019 issue of "Get Your Ducks in a Row" Carolina Family Estate Planning's free newsletter. You can read the rest of the issue, as well as back issues of our newsletter online at www.carolinafep.com/library/newsletters/ or subscribe for free at www.carolinafep.com/newsletter.cfm
This article is part 1 of a series of 2 articles. The second article of the series is posted here.
“I, Benjamin Franklin, of Philadelphia, printer, late Minister Plenipotentiary from the United States of America to the Court of France, now President of the State of Pennsylvania, do make and declare my last will and testament...” And so begins the will of that famous founding Father, authored by Franklin on July 17, 1788.
Old Ben's will is full of all the ingenuity and thoroughness one would expect from Philadelphia’s favorite son. Upon his death two years later, his executor and heirs found detailed instructions for dispersing his property, his books and papers, and his financial holdings.
The will mentions his two children and their families. As it turns out, Franklin’s son William, because of his loyalty to the British crown, was a source of heartbreak to his father. After bequeathing William several plots of land in Nova Scotia, Franklin writes “The part he acted against me in the late war, which is of public notoriety, will account for my leaving him no more of an estate than he endeavoured to deprive me of.” Yikes.
Instead, Franklin concentrated much of his estate on his daughter and son-in-law, Sarah and Richard Bache, and their heirs.
But not all of his estate.
Franklin, after all, was an inventor and an entrepreneur. He was also deeply rooted in Philadelphia and, to a lesser extent, Boston. Franklin basically invented a way to perpetuate his values in his favorite cities.
He wanted to leave a legacy for those he saw as contributing to the establishment of the young nation by starting
businesses: “I have considered that among artisans, good apprentices are most likely to make good citizens, and, having myself been bred to a manual art, printing...I wish to be useful even after my Death, if possible, informing and advancing other young men that they may be serviceable to their country.”
In an astonishing show of creative benevolence, Franklin helped these young men by establishing a sophisticated model of micro-lending. He was certainly ahead of his time.
Ben Franklin's estate planning documents carefully structure two philanthropic trusts designed to last exactly 200 years. He made two separate trusts-one to the city of Boston and one to his hometown of Philadelphia. Each trust contained 1,000 pounds, roughly equivalent to $110,000 today. The trust was designed to be doled out in small loans at 5% per year to married men under 25 who had completed an apprenticeship and wanted to start a business.
Over time, the scope of the trust beneficiaries increased and diversified to include a broad range of loans for academic studies or vocational training. As recently as 1962 to 1976, “loans totaling $3,476,000, went to 1,749 young people who, at the time of receiving help, were mostly living at 'bare subsistence level.' Applicants could get up to $7,000.”
Beginning in 1890, the bulk of the growing trusts migrated to two institutions, the Benjamin Franklin Institute of Technology in Boston and the Franklin Institute in Philadelphia. By the time Ben’s two centuries of posthumous experimentation drew to a close, the compounded value of the funds was $4.5 million in Boston and $2 million in Philadelphia. They were turned over to the institutions fully when the experiment expired in 1990.
Ben Franklin was a principled man, and his will was an extension of his lived values: thrift, industry, liberty, and self- reliance. His strategic estate planning carried his principles into perpetuity, benefiting his biological heirs as well as those with the potential to make something of themselves through hard work and an entrepreneurial spirit.
I believe that estate planning is, in its best form, values based. Here at Carolina Family Estate Planning, we spend a lot of time asking you about what you value. Those questions come with a goal: to make sure those values translate into every aspect of your estate plan.
We would love to help you actualize your values in a personal estate plan. If you are ready for help, please give us a call at 919-443-3035.
