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Unlike many of the other Founding Fathers of America, Alexander Hamilton was not born into a family of wealth and title. Hamilton's mother, Rachel Fawcett, married sugar planter John Lavien on the island of St. Croix in the 1740s. Their relationship was tumultuous, and Lavien frequently beat her. After Lavien had Rachel imprisoned for a short term after one fight, she left her husband and son and fled to the islands of Nevis and St. Kitts in the Caribbean. While there, Rachel met James Hamilton in 1751 and lived with him for nearly fifteen years, even though she had not formally divorced Lavien. James Hamilton and Rachel Lavien had two sons together: James, who was born in 1753, and Alexander. Interestingly, the exact year of Alexander Hamilton's birth is unknown because historians have found two sets of birth records. One set claims Hamilton was born on January 11, 1755, while the other says he was born in 1757. Hamilton himself maintained that he was born in 1757.

Alexander Hamilton's family was too poor to afford any regular schooling for the boys, although Alexander later recalled studying for a short time at a Jewish school. When Alexander was ten years old, he and his family moved back to the island of St. Croix. After discovering that Rachel was still technically married to John Lavien, James Hamilton, Sr. returned to Nevis and St. Kitts, leaving Rachel and his two sons behind. Although Alexander wrote to his father for the rest of his life, he never saw James Hamilton, Sr. again. Alexander and his faced further tragedy when Rachel died of a fever in 1768. Worse still, John Lavien took the small inheritance Rachel Fawcett had left her sons and gave the money to his and Rachel's son, Peter. James Hamilton, Jr. and Alexander Hamilton went to live for a year with an older cousin, but left when the cousin committed suicide. With no money or family, the two boys were destitute orphans.

To help make ends meet, the teenaged Alexander became a clerk for Nicholas Cruger, a merchant who traded throughout the Caribbean and with the British colonies that would later become the United States. Cruger quickly recognized the intensity of Alexander's genius. Even though he was only fifteen years old, Alexander had a gift for mathematics and business; he could keep excellent expense and profit ledgers, could communicate with local authorities and sea captains, and could write extremely well for his age. In fact, the young Hamilton published several letters and small collections of poetry in his local newspaper that made him famous in St. Croix. When Cruger left the island for business purposes, he usually left Alexander in charge of the company. Alexander enjoyed the work, which challenged him and forced him to use his powers of reason.

At the same time, however, Hamilton longed to leave the island and see the rest of the world, particularly the British colonies on the mainland. Hamilton also wanted to attend school, but felt that this dream was unlikely because he was of improper birth and had no money. Fortunately for Hamilton, Reverend Hugh Knox, a minister at the local Presbyterian Church, recognized Alexander's intelligence and encouraged him to leave St. Croix to attend college in the colonies. Knox specifically wanted Hamilton to attend the Presbyterian-run College of New Jersey, which later became known as Princeton University. Cruger's influence as a prominent businessman helped Knox secure an interview for Alexander at the College of New Jersey. In October of 1772, Hamilton left St. Croix for New York. He later recalled that after boarding the ship, he never had the desire to return to St. Croix or any other part of the Caribbean, and once he landed in New York, quickly made the United States his new home.

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