Rule of 72
Estimate how many years it takes for capital to double, from a rate.
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Doubling your money: how long?
The rule of 72 answers with one division: 72 ÷ annual rate. Set the rate and compare the estimate to the exact compound-interest calculation, plus the time to quadruple.
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Set the rate
The expected annual return, in %.
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Read the estimate
72 ÷ rate gives the years to double.
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Check the exact
ln(2) ÷ ln(1 + rate) for precision.
Rule of 72 vs exact calculation
| Rate | Rule of 72 | Exact calculation |
|---|---|---|
| 2% | 36 yrs | 35.0 yrs |
| 6% | 12 yrs | 11.9 yrs |
| 8% | 9 yrs | 9.0 yrs |
| 10% | 7.2 yrs | 7.3 yrs |
| 12% | 6 yrs | 6.1 yrs |
Indicative estimate, not financial advice. The rule assumes a constant rate and compound interest.
Frequently asked questions
What is the rule of 72?
A mental-math shortcut: the time to double capital ≈ 72 ÷ annual rate (in %). At 8%, you get 72 ÷ 8 = 9 years. It assumes compound interest at a constant rate.
Is it accurate?
It is an approximation, but a very good one between 4% and 12%. The exact calculation is ln(2) ÷ ln(1 + rate). At 8%, the exact gives 9.0 years, identical to the estimate; at 2%, 36 (rule) vs 35.0 (exact).
How do I find the time to quadruple?
Quadrupling is doubling twice: just double the doubling time. At 8%, ×4 takes about 18 years. ×8 takes three doublings, i.e. ~27 years.
What is it useful for day to day?
To quickly gauge compound interest: savings, investments, but also inflation erosion (at 3%, purchasing power halves in ~24 years). For precise figures, use the exact calculation shown.